(a) A bank may charge against the account of a customer an item that is properly payable from that account even though the charge creates an overdraft. An item is properly payable if it is authorized by the customer and is in accordance with any agreement between the customer and bank.
(b) A customer is not liable for the amount of an overdraft if the customer neither signed the item nor benefited from the proceeds of the item.
(c) A bank may charge against the account of a customer a check that is otherwise properly payable from the account, even though payment was made before the date of the check, unless the customer has given notice to the bank of the postdating describing the check with reasonable certainty. The notice is effective for the period stated in Section 4-403(b) for stop-payment orders, and must be received at such time and in such manner as to afford the bank a reasonable opportunity to act on it before the bank takes any action with respect to the check described in Section 4-303. If a bank charges against the account of a customer a check before the date stated in the notice of postdating, the bank is liable for damages for the loss resulting from its act. The loss may include damages for dishonor of subsequent items under Section 4-402.
(d) A bank that in good faith makes payment to a holder may charge the indicated account of its customer according to:
(1) The original terms of the altered item; or
(2) The terms of the completed item, even though the bank knows the item has been completed unless the bank has notice that the completion was improper.
5A Del. C. 1953,
§§
4-401;
55 Del. Laws, c. 349;
70 Del. Laws, c. 86,
§
4;
Notes of Decisions
Travelers Cas. & Sur. Co. of Am. v. Bancorp Bank, 691 F. Supp. 2d 531 (D. Del. 2009).
· cites it 2× “Like the title company in the Farmers decision, plaintiff at bar cannot sue Benefit’s bank (First Trust) under 6 Del. C. § 4-401(a). Since the disputed checks were made payable to defendant or BCG Banking Services, Sautner was never a holder of the disputed checks.”
Blaskovitz, Jr. v. Dover Fed. Credit Union (Del. Super. Ct. 2017).
· cites it 2× “§ 4-406; 6 Del. C. § 4-401(a) (imposing strict liability as the basic rule when a bank charges an unauthorized item against a customer’s account); 6 Del.”
Kathleen Keener v. Wells Fargo Bank N.A. (Del. Ct. Com. Pl. 2017).
· cites it 2× “; see also 6 Del. C. § 4-401 (When bank may charge customer’s account) (“A bank may charge against the account of a customer an item that is properly payable from that account even though the charge creates an overdraft.”
Keeler v. Wells Fargo Bank, N.A. (Del. Super. Ct. 2019).
“§ 4-406 in her Complaint, but Wells Fargo argued in the trial court that its obligations to Keeler are under 6 Del. C. § 4-401. 16 See id. the discovery rule_to “State UCC claims that are inherently unknowable,”17 where the statute of limitations does not accrue until the victim…”
— 6 Del. C. § 4-401(a) — 2 cases
Travelers Cas. & Sur. Co. of Am. v. Bancorp Bank, 691 F. Supp. 2d 531 (D. Del. 2009).
“Like the title company in the Farmers decision, plaintiff at bar cannot sue Benefit’s bank (First Trust) under 6 Del. C. § 4-401(a). Since the disputed checks were made payable to defendant or BCG Banking Services, Sautner was never a holder of the disputed checks.”
Blaskovitz, Jr. v. Dover Fed. Credit Union (Del. Super. Ct. 2017).
“§ 4-406; 6 Del. C. § 4-401(a) (imposing strict liability as the basic rule when a bank charges an unauthorized item against a customer’s account); 6 Del.”
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