§490:4A-406  Payment by originator to
beneficiary; discharge of underlying obligation.  (a)  Subject to sections
490:4A-211(e), 490:4A-405(d), and 490:4A-405(e), the originator of a funds
transfer pays the beneficiary of the originator's payment order (i) at the time
a payment order for the benefit of the beneficiary is accepted by the
beneficiary's bank in the funds transfer and (ii) 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) 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 (i) the payment under subsection (a) was made by a means
prohibited by the contract of the beneficiary with respect to the obligation,
(ii) 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, (iii) funds with respect to the order
were not withdrawn by the beneficiary or applied to a debt of the beneficiary,
and (iv) 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 490:4A-404(a).



(c)  For the purpose of determining whether
discharge of an obligation occurs under subsection (b), 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. [L 1991, c 41, pt of §1]