Florida Statute 674.402 - Full Text and Legal Analysis

The 2025 Florida Statutes

Title XXXIX
COMMERCIAL RELATIONS

Chapter 674
UNIFORM COMMERCIAL CODE: BANK DEPOSITS AND COLLECTIONS

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F.S. 674.402

674.402 Bank’s liability to customer for wrongful dishonor; time of determining insufficiency of account.—

(1) Except as otherwise provided in this chapter, a payor bank wrongfully dishonors an item if it dishonors an item that is properly payable, but a bank may dishonor an item that would create an overdraft unless it has agreed to pay the overdraft.

(2) A payor bank is liable to its customer for damages proximately caused by the wrongful dishonor of an item. Liability is limited to actual damages proved and may include damages for an arrest or prosecution of the customer or other consequential damages. Whether any consequential damages are proximately caused by the wrongful dishonor is a question of fact to be determined in each case.

(3) A payor bank’s determination of the customer’s account balance on which a decision to dishonor for insufficiency of available funds is based may be made at any time between the time the item is received by the payor bank and the time that the payor bank returns the item or gives notice in lieu of return, and no more than one determination need be made. If, at the election of the payor bank, a subsequent balance determination is made for the purpose of reevaluating the bank’s decision to dishonor the item, the account balance at that time is determinative of whether a dishonor for insufficiency of available funds is wrongful.

History.—s. 1, ch. 65-254; s. 39, ch. 92-82.

Note.—s. 4-402, U.C.C.; supersedes s. 659.33.

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Amendments to 674.402

Annotations, Discussions, Cases:

Cases Citing Statute 674.402

Total Results: 5

Koger v. East First Nat. Bank

443 So. 2d 141, 37 U.C.C. Rep. Serv. (West) 531

District Court of Appeal of Florida | Filed: Dec 7, 1983 | Docket: 192485

Cited 2 times | Published

has a cause of action against a bank under section 674.402, Florida Statutes (1981), which tracks the

JTM, INC. v. Totalbank

795 So. 2d 161, 46 U.C.C. Rep. Serv. 2d (West) 787, 2001 Fla. App. LEXIS 12493, 2001 WL 1007408

District Court of Appeal of Florida | Filed: Sep 5, 2001 | Docket: 1673163

Published

has failed to state a claim for relief under section 674.402, Florida Statutes (1993) because that statute

Scott v. NCNB Bank Corp.

642 So. 2d 582, 1994 Fla. App. LEXIS 8096

District Court of Appeal of Florida | Filed: Aug 17, 1994 | Docket: 64750819

Published

founded on a theory of wrongful dishonor under section 674.402(2), Florida Statutes. Graham v. First Marion

Govaert v. First American Bank & Trust Co. (In re Geri Zahn, Inc.)

135 B.R. 912, 16 U.C.C. Rep. Serv. 2d (West) 731, 1991 Bankr. LEXIS 1956

United States Bankruptcy Court, S.D. Florida. | Filed: Dec 19, 1991 | Docket: 65780287

Published

Debtor’s checks, in violation of Florida Statutes § 674.402, ruining the Debtor’s business reputation and

Govaert v. First American Bank & Trust (In re Geri Zahn, Inc.)

109 B.R. 497, 1989 Bankr. LEXIS 2298

United States Bankruptcy Court, S.D. Florida. | Filed: Jul 13, 1989 | Docket: 65779940

Published

damages for Wrongful Dishonor, pursuant to F.S. 674.-402, Interference with Advantageous Business Relationship