§490:4-214  Right of charge back or
refund; liability of collecting bank; return of item.  (a)  If a collecting
bank has made provisional settlement with its customer for an item and fails by
reason of dishonor, suspension of payments by a bank, or otherwise to receive
settlement for the item which is or becomes final, the bank may revoke the
settlement given by it, charge back the amount of any credit given for the item
to its customer's account, or obtain refund from its customer, whether or not
it is able to return the item, if by its midnight deadline or within a longer
reasonable time after it learns the facts it returns the item or sends
notification of the facts.  If the return or notice is delayed beyond the
bank's midnight deadline or a longer reasonable time after it learns the facts,
the bank may revoke the settlement, charge back the credit, or obtain refund
from its customer, but it is liable for any loss resulting from the delay. 
These rights to revoke, charge back, and obtain refund terminate if and when a
settlement for the item received by the bank is or becomes final.



(b)  A collecting bank returns an item when it
is sent or delivered to the bank's customer or transferor or pursuant to its
instructions.



(c)  A depositary bank that is also the payor
may charge back the amount of an item to its customer's account or obtain
refund in accordance with the section governing return of an item received by a
payor bank for credit on its books (section 490:4-301).



(d)  The right to charge back is not affected
by:



(1)  Previous use of a credit given for the item; or



(2)  Failure by any bank to exercise ordinary care
with respect to the item, but a bank so failing remains liable.



(e)  A failure to charge back or claim refund
does not affect other rights of the bank against the customer or any other
party.



(f)  If credit is given in dollars as the
equivalent of the value of an item payable in foreign money, the dollar amount
of any charge back or refund must be calculated on the basis of the bank-offered
spot rate for the foreign money prevailing on the day when the person entitled
to the charge back or refund learns that it will not receive payment in
ordinary course. [L 1965, c 208, §4-212; HRS §490:4-212; am and ren L 1991, c
118, pt of §4]