Tex. Bus. & Com. Code Section 4.301
Deferred Posting; Recovery of Payment by Return of Items; Time of Dishonor; Return of Items by Payor Bank

(a)

If a payor bank settles for a demand item other than a documentary draft presented otherwise than for immediate payment over the counter before midnight of the banking day of receipt, the payor bank may revoke the settlement and recover the settlement if, before it has made final payment and before its midnight deadline, it:

(1)

returns the item;

(2)

returns an image of the item, if the party to which the return is made has entered into an agreement to accept an image as a return of the item, and the image is returned in accordance with that agreement; or

(3)

sends a record providing notice of dishonor or nonpayment if the item is unavailable for return.

(b)

If a demand item is received by a payor bank for credit on its books, it may return the item or send notice of dishonor and may revoke any credit given or recover the amount thereof withdrawn by its customer, if it acts within the time limit and in the manner specified in Subsection (a).

(c)

Unless previous notice of dishonor has been sent, an item is dishonored at the time when for purposes of dishonor it is returned or notice sent in accordance with this section.

(d)

An item is returned:

(1)

as to an item presented through a clearing house, when it is delivered to the presenting or last collecting bank or to the clearing house or is sent or delivered in accordance with clearing-house rules; or

(2)

in all other cases, when it is sent or delivered to the bank’s customer or transferor or pursuant to instructions.
Acts 1967, 60th Leg., p. 2343, ch. 785, Sec. 1, eff. Sept. 1, 1967. Amended by Acts 1995, 74th Leg., ch. 921, Sec. 4, eff. Jan. 1, 1996.
Amended by:
Acts 2005, 79th Leg., Ch. 95 (S.B. 1563), Sec. 19, eff. September 1, 2005.

Source: Section 4.301 — Deferred Posting; Recovery of Payment by Return of Items; Time of Dishonor; Return of Items by Payor Bank, https://statutes.­capitol.­texas.­gov/Docs/BC/htm/BC.­4.­htm#4.­301 (accessed Apr. 13, 2024).

4.101
Short Title 4.102
Applicability 4.103
Variation by Agreement 4.104
Definitions and Index of Definitions 4.106
Payable Through or Payable at Bank 4.107
Separate Office of a Bank 4.108
Time of Receipt of Items 4.109
Delays 4.110
Electronic Presentment 4.111
Statute of Limitations 4.112
Payment of Check at Par 4.202
Responsibility for Collection or Return 4.203
Effect of Instructions 4.204
Methods of Sending and Presenting 4.205
Depository Bank Holder of Unindorsed Item 4.206
Transfer Between Banks 4.207
Transfer Warranties 4.208
Presentment Warranties 4.209
Encoding and Retention Warranties 4.210
Security Interest of Collecting Bank in Items, Accompanying Documents and Proceeds 4.211
When Bank Gives Value for Purposes of Holder in Due Course 4.212
Presentment by Notice of Item Not Payable By, Through or at a Bank 4.213
Medium and Time of Settlement by Bank 4.214
Right of Charge-back or Refund 4.215
Final Payment of Item by Payor Bank 4.216
Insolvency and Preference 4.301
Deferred Posting 4.302
Payor Bank’s Responsibility for Late Return of Item 4.303
When Items Subject to Notice, Stop-payment Order, Legal Process, or Setoff 4.401
When Bank May Charge Customer’s Account 4.402
Bank’s Liability to Customer for Wrongful Dishonor 4.403
Customer’s Right to Stop Payment 4.404
Bank Not Obligated to Pay Check More than Six Months Old 4.405
Death or Incompetence of Customer 4.406
Customer’s Duty to Discover and Report Unauthorized Signature or Alteration 4.407
Payor Bank’s Right to Subrogation on Improper Payment 4.501
Handling of Documentary Drafts 4.503
Responsibility of Presenting Bank for Documents and Goods 4.504
Privilege of Presenting Bank to Deal with Goods
Green check means up to date. Up to date

Accessed:
Apr. 13, 2024

§ 4.301’s source at texas​.gov