Tennessee Code Annotated
Tenn. Code Ann. § 47-3-418 (2026)
Payment or acceptance by mistake
✓ current as of May 2026
- (a) Except as provided in subsection (c), if the drawee of a draft pays or accepts the draft and the drawee acted on the mistaken belief that (i) payment of the draft had not been stopped pursuant to § 47-4-403 or (ii) the signature of the drawer of the draft was authorized, the drawee may recover the amount of the draft from the person to whom or for whose benefit payment was made or, in the case of acceptance, may revoke the acceptance. Rights of the drawee under this subsection are not affected by failure of the drawee to exercise ordinary care in paying or accepting the draft.
- (b) Except as provided in subsection (c), if an instrument has been paid or accepted by mistake and the case is not covered by subsection (a), the person paying or accepting may, to the extent permitted by the law governing mistake and restitution, (i) recover the payment from the person to whom or for whose benefit payment was made or (ii) in the case of acceptance, may revoke the acceptance.
- (c) The remedies provided by subsection (a) or (b) may not be asserted against a person who took the instrument in good faith and for value or who in good faith changed position in reliance on the payment or acceptance. This subsection does not limit remedies provided by § 47-3-417 or § 47-4-407.
- (d) Notwithstanding § 47-4-215, if an instrument is paid or accepted by mistake and the payor or acceptor recovers payment or revokes acceptance under subsection (a) or (b), the instrument is deemed not to have been paid or accepted and is treated as dishonored, and the person from whom payment is recovered has rights as a person entitled to enforce the dishonored instrument.
Acts 1995, ch. 397, § 2.
Notes of Decisions
Cited in 2
cases (1 in the last 5 years), 2008–2023 · leading case: Doug Goodman v. Com. Bank & Trust Co., 72 F.4th 122 (6th Cir. 2023).
Doug Goodman v. Com. Bank & Trust Co., 72 F.4th 122 (6th Cir. 2023). “At summary judgment, the district court held that two checks cashed at Commercial Bank and Trust were paid to Doug Goodman by “mistake” within the meaning of Tenn. Code Ann. § 47-3-418 (b), and that Goodman could not demonstrate that he took the checks in good faith and for…”
Curtis Morris v. Amsouth Bank (Tenn. Ct. App. 2008). “Tenn. Code Ann. § 47-3-418 (2001) (emphasis added).”
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