Mont. Code Ann. » TITLE 30. TRADE AND COMMERCE · CHAPTER 4. UNIFORM COMMERCIAL CODE BANK DEPOSITS AND COLLECTIONS · Part 1. General Provisions and Definitions
Montana Code Annotated

Mont. Code Ann. § 30-4-103 (2026)

Variation By Agreement -- Measure Of Damages -- Action Constituting Ordinary Care

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  1. MCA Contents
  2. TITLE 30
  3. CHAPTER 4
  4. Part 1
  5. 30-4-103 Variation by agreement -- measure of damages -- action constituting ordinary care

TITLE 30. TRADE AND COMMERCE

CHAPTER 4. UNIFORM COMMERCIAL CODE BANK DEPOSITS AND COLLECTIONS

Part 1. General Provisions and Definitions

Variation By Agreement -- Measure Of Damages -- Action Constituting Ordinary Care

30-4-103. Variation by agreement -- measure of damages -- action constituting ordinary care. (1) The effect of the provisions of this chapter may be varied by agreement, but the parties to the agreement may not disclaim a bank's responsibility for its own lack of good faith or failure to exercise ordinary care or limit the measure of damages for the lack or failure. However, the parties may determine by agreement the standards by which the bank's responsibility is to be measured if those standards are not manifestly unreasonable.

(2) Federal reserve regulations and operating circulars, clearinghouse rules, and the like, have the effect of agreements under subsection (1), whether or not specifically assented to by all parties interested in items handled.

(3) Action or nonaction approved by this chapter or pursuant to federal reserve regulations or operating circulars constitutes the exercise of ordinary care and, in the absence of special instructions, action or nonaction consistent with clearinghouse and similar rules or with a general banking usage not disapproved by this chapter, constitutes prima facie the exercise of ordinary care.

(4) The specification or approval of certain procedures by this chapter does not constitute disapproval of other procedures that may be reasonable under the circumstances.

(5) The measure of damages for failure to exercise ordinary care in handling an item is the amount of the item reduced by an amount that could not have been realized by the exercise of ordinary care. If there is also bad faith it includes any other damages the party suffered as a proximate consequence.

History: En. Sec. 4-103, Ch. 264, L. 1963; R.C.M. 1947, 87A-4-103; amd. Sec. 156, Ch. 410, L. 1991.

Notes of Decisions
Cited in 4 cases, 1984–2006 · leading case: Ahmann v. Am. Fed. Sav. & Loan Ass'n, 766 P.2d 853 (Mont. 1988).
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Ahmann v. Am. Fed. Sav. & Loan Ass'n, 766 P.2d 853 (Mont. 1988). · cites it 6× “” Section 30-4-103(5), MCA. American Federal would have been liable for the entire $7,000 had it not been repaid by Dave Bird.”
Iverson v. First Bank of Billings, 712 P.2d 1285 (Mont. 1985). · cites it 21× “Under issue # 2, the facts which lead us to the conclusion that the subject check was not a "demand item," also lead us to the conclusion that the parties agreed under § 30-4-103, MCA, that the midnight deadline of § 30-4-302 should not apply to the instant case.”
Gee v. Egbert, 679 P.2d 1194 (Mont. 1984). · cites it 3× “The applicable commercial standards in the Uniform Commercial Code are not specified in Williams , but we note that Section 30-4-103(3), MCA, provides that action or non-action by a bank approved by the Uniform Commercial Code or pursuant to the Federal Reserve Regulations of…”
Valley Bank v. Hughes, 2006 MT 285, 147 P.3d 185. “See §§ 30-4-103(3), 30-4-103(5), and 30-4-212, MCA.”
Mont. Code Ann. § 30-4-103(3): 2 cases
Gee v. Egbert, 679 P.2d 1194 (Mont. 1984). “The applicable commercial standards in the Uniform Commercial Code are not specified in Williams , but we note that Section 30-4-103(3), MCA, provides that action or non-action by a bank approved by the Uniform Commercial Code or pursuant to the Federal Reserve Regulations of…”
Valley Bank v. Hughes, 2006 MT 285, 147 P.3d 185. “See §§ 30-4-103(3), 30-4-103(5), and 30-4-212, MCA.”
Mont. Code Ann. § 30-4-103(5): 1 case
Ahmann v. Am. Fed. Sav. & Loan Ass'n, 766 P.2d 853 (Mont. 1988). “” Section 30-4-103(5), MCA. American Federal would have been liable for the entire $7,000 had it not been repaid by Dave Bird.”
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