47-4103. Variation by agreement; measure of
damages; action constituting ordinary care
A. The effect of the provisions of this chapter may be varied by agreement, but the
parties to the agreement cannot disclaim a bank's responsibility for its 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.
B. Federal reserve regulations and operating circulars, clearing-house rules, and
the like have the effect of agreements under subsection A, whether or not specifically
assented to by all parties interested in items handled.
C. Action or non-action approved by this chapter or pursuant to federal reserve
regulations or operating circulars is the exercise of ordinary care and, in the absence
of special instructions, action or non-action consistent with clearing-house rules and
the like or with a general banking usage not disapproved by this chapter, is prima facie
the exercise of ordinary care.
D. The specification or approval of certain procedures by this chapter is not
disapproval of other procedures that may be reasonable under the circumstances.
E. 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.
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