47-4A406. Payment by originator to
beneficiary; discharge of underlying obligation


A. Subject to section 47-4A211, subsection E and section 47-4A405, subsections D
and E, the originator of a funds transfer pays the beneficiary of the originator's
payment order at the time a payment order for the benefit of the beneficiary is accepted
by the beneficiary's bank in the funds transfer and in an amount equal to the amount of
the order accepted by the beneficiary's bank, but not more than the amount of the
originator's order.


B. If payment under subsection A of this section is made to satisfy an obligation,
the obligation is discharged to the same extent discharge would result from payment to
the beneficiary of the same amount in money, unless the payment under subsection A of
this section was made by a means prohibited by the contract of the beneficiary with
respect to the obligation, the beneficiary, within a reasonable time after receiving
notice of receipt of the order by the beneficiary's bank, notified the originator of the
beneficiary's refusal of the payment, funds with respect to the order were not withdrawn
by the beneficiary or applied to a debt of the beneficiary and the beneficiary would
suffer a loss that could reasonably have been avoided if payment had been made by a means
complying with the contract. If payment by the originator does not result in discharge
under this section, the originator is subrogated to the rights of the beneficiary to
receive payment from the beneficiary's bank under section 47-4A404, subsection A.


C. For the purpose of determining whether discharge of an obligation occurs under
subsection B of this section, if the beneficiary's bank accepts a payment order in an
amount equal to the amount of the originator's payment order less charges of one or more
receiving banks in the funds transfer, payment to the beneficiary is deemed to be in the
amount of the originator's order unless upon demand by the beneficiary the originator
does not pay the beneficiary the amount of the deducted charges.


D. Rights of the originator or of the beneficiary of a funds transfer under this
section may be varied only by agreement of the originator and the beneficiary.