47-4407. Payor bank's right to subrogation on
improper payment
If a payor bank has paid an item over the order of the drawer or maker to stop
payment, or after an account has been closed or otherwise under circumstances giving a
basis for objection by the drawer or maker, to prevent unjust enrichment and only to the
extent necessary to prevent loss to the bank by reason of its payment of the item, the
payor bank is subrogated to the rights:
1. Of any holder in due course on the item against the drawer or maker;
2. Of the payee or any other holder of the item against the drawer or maker either
on the item or under the transaction out of which the item arose; and
3. Of the drawer or maker against the payee or any other holder of the item with
respect to the transaction out of which the item arose.
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