Tex. Bus. & Com. Code Section 3.602
Payment


(a)

Subject to Subsection (e), an instrument is paid to the extent payment is made by or on behalf of a party obliged to pay the instrument, and to a person entitled to enforce the instrument.

(b)

Subject to Subsection (e), a note is paid to the extent payment is made by or on behalf of a party obliged to pay the note to a person that formerly was entitled to enforce the note only if at the time of the payment the party obliged to pay has not received adequate notification that the note has been transferred and that payment is to be made to the transferee. A notification is adequate only if it is signed by the transferor or the transferee, reasonably identifies the transferred note, and provides an address at which payments subsequently are to be made. Upon request, a transferee shall seasonably furnish reasonable proof that the note has been transferred. Unless the transferee complies with the request, a payment to the person that formerly was entitled to enforce the note is effective for purposes of Subsection (c) even if the party obliged to pay the note has received a notification under this subsection.

(c)

Subject to Subsection (e), to the extent of a payment under Subsections (a) and (b), the obligation of the party obliged to pay the instrument is discharged even though payment is made with knowledge of a claim to the instrument under Section 3.306 (Claims to an Instrument) by another person.

(d)

Subject to Subsection (e), a transferee, or any party that has acquired rights in the instrument directly or indirectly from a transferee, including any such party that has rights as a holder in due course, is deemed to have notice of any payment that is made under Subsection (b) after the date that the note is transferred to the transferee but before the party obliged to pay the note receives adequate notification of the transfer.

(e)

The obligation of a party to pay the instrument is not discharged under Subsections (a) through (d) if:

(1)

a claim to the instrument under Section 3.306 (Claims to an Instrument) is enforceable against the party receiving payment and:

(A)

payment is made with knowledge by the payor that payment is prohibited by injunction or similar process of a court of competent jurisdiction; or

(B)

in the case of an instrument other than a cashier’s check, teller’s check, or certified check, the party making payment accepted, from the person having a claim to the instrument, indemnity against loss resulting from refusal to pay the person entitled to enforce the instrument; or

(2)

the person making payment knows that the instrument is a stolen instrument and pays a person it knows is in wrongful possession of the instrument.

(f)

As used in this section, “signed,” with respect to a record that is not a writing, includes the attachment to or logical association with the record of an electronic symbol, sound, or process with the present intent to adopt or accept the record.
Amended by Acts 1995, 74th Leg., ch. 921, Sec. 1, eff. Jan. 1, 1996.
Amended by:
Acts 2005, 79th Leg., Ch. 95 (S.B. 1563), Sec. 12, eff. September 1, 2005.

Source: Section 3.602 — Payment, https://statutes.­capitol.­texas.­gov/Docs/BC/htm/BC.­3.­htm#3.­602 (accessed Mar. 23, 2024).

3.101
Short Title
3.102
Subject Matter
3.103
Definitions
3.104
Negotiable Instrument
3.105
Issue of Instrument
3.106
Unconditional Promise or Order
3.107
Instrument Payable in Foreign Money
3.108
Payable on Demand or at Definite Time
3.109
Payable to Bearer or to Order
3.110
Identification of Person to Whom Instrument Is Payable
3.111
Place of Payment
3.112
Interest
3.113
Date of Instrument
3.114
Contradictory Terms of Instrument
3.115
Incomplete Instrument
3.116
Joint and Several Liability
3.117
Other Agreements Affecting Instrument
3.118
Statute of Limitations
3.119
Notice of Right to Defend Action
3.201
Negotiation
3.202
Negotiation Subject to Rescission
3.203
Transfer of Instrument
3.204
Indorsement
3.205
Special Indorsement
3.206
Restrictive Indorsement
3.207
Reacquisition
3.301
Person Entitled to Enforce Instrument
3.302
Holder in Due Course
3.303
Value and Consideration
3.304
Overdue Instrument
3.305
Defenses and Claims in Recoupment
3.306
Claims to an Instrument
3.307
Notice of Breach of Fiduciary Duty
3.308
Proof of Signatures and Status as Holder in Due Course
3.309
Enforcement of Lost, Destroyed, or Stolen Instrument
3.310
Effect of Instrument on Obligation for Which Taken
3.311
Accord and Satisfaction by Use of Instrument
3.312
Lost, Destroyed, or Stolen Cashier’s Check, Teller’s Check, or Certified Check
3.401
Signature
3.402
Signature by Representative
3.403
Unauthorized Signature
3.404
Impostors
3.405
Employer’s Responsibility for Fraudulent Indorsement by Employee
3.406
Negligence Contributing to Forged Signature or Alteration of Instrument
3.407
Alteration
3.408
Drawee Not Liable on Unaccepted Draft
3.409
Acceptance of Draft
3.410
Acceptance Varying Draft
3.411
Refusal to Pay Cashier’s Checks, Teller’s Checks, and Certified Checks
3.412
Obligation of Issuer of Note or Cashier’s Check
3.413
Obligation of Acceptor
3.414
Obligation of Drawer
3.415
Obligation of Indorser
3.416
Transfer Warranties
3.417
Presentment Warranties
3.418
Payment or Acceptance by Mistake
3.419
Instruments Signed for Accommodation
3.420
Conversion of Instrument
3.501
Presentment
3.502
Dishonor
3.503
Notice of Dishonor
3.504
Excused Presentment and Notice of Dishonor
3.505
Evidence of Dishonor
3.506
Processing Fee by Holder of Payment Device
3.507
Delivery Notification Fee by Holder of Check or Similar Sight Order
3.601
Discharge and Effect of Discharge
3.602
Payment
3.603
Tender of Payment
3.604
Discharge by Cancellation or Renunciation
3.605
Discharge of Secondary Obligors

Accessed:
Mar. 23, 2024

§ 3.602’s source at texas​.gov