Kentucky Revised Statutes

Ky. Rev. Stat. § 355.4-403 (2026)

Customer's right to stop payment -- Burden of proof of loss

✓ current as of May 2026

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(1) A customer or any person authorized to draw on the account if there is more than one (1) person may stop payment of any item drawn on the customer's account or close the account by an order to the bank describing the item or account with reasonable certainty received at a time and in a manner that affords the bank a reasonable opportunity to act on it before any action by the bank with respect to the item described in KRS 355.4-303. If the signature of more than one (1) person is required to draw on an account, any of these persons may stop payment or close the account.

(2) A stop-payment order is effective for six (6) months, but it lapses after fourteen (14) calendar days if the original order was oral and was not confirmed in a record within that period. A stop-payment order may be renewed for additional six (6) month periods by a record given to the bank within a period during which the stop- payment order is effective.

(3) The burden of establishing the fact and amount of loss resulting from the payment of an item contrary to a stop-payment order or order to close an account is on the customer. The loss from payment of an item contrary to a stop-payment order may include damages for dishonor of subsequent items under KRS 355.4-402. Effective: July 12, 2006 History: Amended 2006 Ky. Acts ch. 242, sec. 51, effective July 12, 2006. -- Amended 1996 Ky. Acts ch. 130, sec. 104, effective January 1, 1997. -- Created 1958 Ky. Acts ch. 77, sec. 4-403, effective July 1, 1960.

Notes of Decisions

Cited in 2 cases, 1986–1986 · leading case: Dalton v. First Nat'l Bank of Grayson, 712 S.W.2d 954 (Ky. Ct. App. 1986).

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Dalton v. First Nat'l Bank of Grayson, 712 S.W.2d 954 (Ky. Ct. App. 1986). · cites it 2× “KRS 355.4-403(1). An oral order is sufficient.”

Stadnyk, 2008 T.C. Memo. 289 (1970). “Thus, Bank One owed petitioner wife certain duties imposed under the State banking statute. Negligence in the performance of those duties could give rise to a tort claim sufficient to satisfy the first prong of the section 104(a)(2) income exclusion.”

— Ky. Rev. Stat. § 355.4-403(1) — 1 case

Dalton v. First Nat'l Bank of Grayson, 712 S.W.2d 954 (Ky. Ct. App. 1986). “KRS 355.4-403(1). An oral order is sufficient.”

— Ky. Rev. Stat. § 355.4-403(2) — 1 case

Dalton v. First Nat'l Bank of Grayson, 712 S.W.2d 954 (Ky. Ct. App. 1986). “KRS 355.4-403(1). An oral order is sufficient.”

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