(4A-204) Refund of payment and duty of customer to report with respect to unauthorized payment order
N.D. Cent. Code § 41-04.1-12
in effect41-04.1-12. (4A-204) Refund of payment and duty of customer to report with respect
to unauthorized payment order.
1. If a receiving bank accepts a payment order issued in the name of its customer as
sender which is not authorized and not effective as the order of the customer under
section 41-04.1-10 or is not enforceable, in whole or in part, against the customer
under section 41-04.1-11, the bank shall refund any payment of the payment order
received from the customer to the extent the bank is not entitled to enforce payment
and shall pay interest on the refundable amount from the date the bank received
payment to the date of the refund. However, the customer is not entitled to interest
from the bank on the amount to be refunded if the customer fails to exercise ordinary
care to determine that the order was not authorized by the customer and to notify the
bank of the relevant facts within a reasonable time not exceeding ninety days after the
date the customer received notification from the bank that the order was accepted or
that the customer's account was debited with respect to the order. The bank is not
entitled to any recovery from the customer because of a failure by the customer to give
notification as stated in this section.
2. Reasonable time under subsection 1 may be fixed by agreement under subsection 1
of section 41-01-16, but the obligation of a receiving bank to refund payment as stated
in subsection 1 may not otherwise be varied by agreement.
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://ndlegis.gov/cencode/t41c04-1.pdf#nameddest=41-04p1-12Fetched: 10/16/2026