Ark. Code Ann. » Title 4 Chapter 04
Arkansas Code Annotated

Ark. Code Ann. § 4-4-303 (2026)

When items subject to notice, stop-payment order, legal process, or setoff — Order in which items may be charged or certified

✓ current as of May 2026
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  1. Any knowledge, notice, or stop-payment order received by, legal process served upon, or setoff exercised by a payor bank comes too late to terminate, suspend, or modify the bank's right or duty to pay an item or to charge its customer's account for the item if the knowledge, notice, stop-payment order, or legal process is received or served and a reasonable time for the bank to act thereon expires or the setoff is exercised after the earliest of the following:
    1. the bank accepts or certifies the item;
    2. the bank pays the item in cash;
    3. the bank settles for the item without having a right to revoke the settlement under statute, clearinghouse rule, or agreement;
    4. the bank becomes accountable for the amount of the item under § 4-4-302 dealing with the payor bank's responsibility for late return of items; or
    5. with respect to checks, a cutoff hour no earlier than one (1) hour after the opening of the next banking day after the banking day on which the bank received the check and no later than the close of that next banking day or, if no cutoff hour is fixed, the close of the next banking day after the banking day on which the bank received the check.
  2. Subject to subsection (a), items may be accepted, paid, certified, or charged to the indicated account of its customer in any order.

History. Acts 1961, No. 185, § 4-303; A.S.A. 1947, § 85-4-303; Acts 1991, No. 572, § 6.

Case Notes

Applicability.

In an action arising out of a state-chartered bank's practices regarding the order in which debit card transactions were posted to maximize overdraft fees, the bank's argument that the principles in this section should be extended to debit card transactions failed; nor did UCC Article 4A apply as debit card transactions are within the scope of the Electronic Fund Transfer Act, 15 U.S.C. § 1693a(7), and therefore expressly outside the scope of Article 4A. Hanjy v. Arvest Bank, 94 F. Supp. 3d 1012 (E.D. Ark. 2015).

Remedies.

Bank was entitled to pursue its rights of setoff and repossession and sale simultaneously. Neel v. Citizens First State Bank, 28 Ark. App. 116, 771 S.W.2d 303 (1989).

Part 4 — Relationship Between Payor Bank and Its Customer

Publisher's Notes. For Comments regarding the Uniform Commercial Code, see Commentaries Volume A.

Research References

ALR.

What constitutes wrongful dishonor of check rendering payor bank liable to drawer under UCC § 4-402. 88 A.L.R.4th 568.

Who may recover for wrongful dishonor of check under UCC § 4-402. 88 A.L.R.4th 613.

Damages recoverable for wrongful dishonor of check under UCC § 4-402. 88 A.L.R.4th 644.

Notes of Decisions
Cited in 2 cases, 1989–2019 · leading case: Neel v. Citizens First State Bank of Arkadelphia, 771 S.W.2d 303 (Ark. Ct. App. 1989).
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Neel v. Citizens First State Bank of Arkadelphia, 771 S.W.2d 303 (Ark. Ct. App. 1989). · cites it 2× “Moreover, our review of the Uniform Commercial Code and the relevant case law reveals no reason why a bank cannot set off a depositor’s account for an overdue debt and exercise its right to repossess collateral securing that debt simultaneously.”
Eagle Bank & Trust Co. v. Raynor Mfg. Co., 574 S.W.3d 196 (2019). · cites it 2× “Ark. Code Ann. § 4-4-303 (Repl. 2001) (emphasis added).”
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