Variation by agreement--measure of damages--actionconstituting ordinary care.
400.4-103. (a) The effect of the provisions of thisarticle may be varied by agreement, but the parties to theagreement cannot disclaim a bank's responsibility for its lack ofgood faith or failure to exercise ordinary care or limit themeasure of damages for the lack or failure. However, the partiesmay determine by agreement the standards by which the bank'sresponsibility is to be measured if those standards are notmanifestly unreasonable.
(b) Federal Reserve regulations and operating circulars,clearing-house rules, and the like have the effect of agreementsunder subsection (a), whether or not specifically assented to byall parties interested in items handled.
(c) Action or nonaction approved by this article orpursuant to Federal Reserve regulations or operating circulars isthe exercise of ordinary care and, in the absence of specialinstructions, action or nonaction consistent with clearing-houserules and the like or with a general banking usage notdisapproved by this article, is prima facie the exercise ofordinary care.
(d) The specification or approval of certain procedures bythis article is not disapproval of other procedures that may bereasonable under the circumstances.
(e) The measure of damages for failure to exercise ordinarycare in handling an item is the amount of the item reduced by anamount that could not have been realized by the exercise ofordinary care. If there is also bad faith it includes any otherdamages the party suffered as a proximate consequence.
Variation by agreement--measure of damages--actionconstituting ordinary care.
400.4-103. (a) The effect of the provisions of thisarticle may be varied by agreement, but the parties to theagreement cannot disclaim a bank's responsibility for its lack ofgood faith or failure to exercise ordinary care or limit themeasure of damages for the lack or failure. However, the partiesmay determine by agreement the standards by which the bank'sresponsibility is to be measured if those standards are notmanifestly unreasonable.
(b) Federal Reserve regulations and operating circulars,clearing-house rules, and the like have the effect of agreementsunder subsection (a), whether or not specifically assented to byall parties interested in items handled.
(c) Action or nonaction approved by this article orpursuant to Federal Reserve regulations or operating circulars isthe exercise of ordinary care and, in the absence of specialinstructions, action or nonaction consistent with clearing-houserules and the like or with a general banking usage notdisapproved by this article, is prima facie the exercise ofordinary care.
(d) The specification or approval of certain procedures bythis article is not disapproval of other procedures that may bereasonable under the circumstances.
(e) The measure of damages for failure to exercise ordinarycare in handling an item is the amount of the item reduced by anamount that could not have been realized by the exercise ofordinary care. If there is also bad faith it includes any otherdamages the party suffered as a proximate consequence.
Variation by agreement--measure of damages--actionconstituting ordinary care.
400.4-103. (a) The effect of the provisions of thisarticle may be varied by agreement, but the parties to theagreement cannot disclaim a bank's responsibility for its lack ofgood faith or failure to exercise ordinary care or limit themeasure of damages for the lack or failure. However, the partiesmay determine by agreement the standards by which the bank'sresponsibility is to be measured if those standards are notmanifestly unreasonable.
(b) Federal Reserve regulations and operating circulars,clearing-house rules, and the like have the effect of agreementsunder subsection (a), whether or not specifically assented to byall parties interested in items handled.
(c) Action or nonaction approved by this article orpursuant to Federal Reserve regulations or operating circulars isthe exercise of ordinary care and, in the absence of specialinstructions, action or nonaction consistent with clearing-houserules and the like or with a general banking usage notdisapproved by this article, is prima facie the exercise ofordinary care.
(d) The specification or approval of certain procedures bythis article is not disapproval of other procedures that may bereasonable under the circumstances.
(e) The measure of damages for failure to exercise ordinarycare in handling an item is the amount of the item reduced by anamount that could not have been realized by the exercise ofordinary care. If there is also bad faith it includes any otherdamages the party suffered as a proximate consequence.
