{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/8.4-402.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/8.4-402.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/8.4-402.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/8.4-402.html"}],"law_id":54315,"edition_id":1,"section_id":54315,"structure_id":13333,"section_number":"8.4-402","catch_line":"Bank’s liability to customer for wrongful dishonor; time of determining insufficiency of account","history":"Code 1950, \u00a7 6-71; 1964, c. 219; 1992, c. 693.","full_text":"a\n\nExcept as otherwise provided in this title, a payor bank wrongfully dishonors an item if it dishonors an item that is properly payable, but a bank may dishonor an item that would create an overdraft unless it has agreed to pay the overdraft.b\n\nA payor bank is liable to its customer for damages proximately caused by the wrongful dishonor of an item. Liability is limited to actual damages proved and may include damages for an arrest or prosecution of the customer or other consequential damages. Whether any consequential damages are proximately caused by the wrongful dishonor is a question of fact to be determined in each case.c\n\nA payor bank’s determination of the customer’s account balance on which a decision to dishonor for insufficiency of available funds is based may be made at any time between the time the item is received by the payor bank and the time that the payor bank returns the item or gives notice in lieu of return, and no more than one determination need be made. If, at the election of the payor bank, a subsequent balance determination is made for the purpose of reevaluating the bank’s decision to dishonor the item, the account balance at the time is determinative of whether a dishonor for insufficiency of available funds is wrongful.","order_by":null,"text":{"0":{"id":199404,"text":"Except as otherwise provided in this title, a payor bank wrongfully dishonors an item if it dishonors an item that is properly payable, but a bank may dishonor an item that would create an overdraft unless it has agreed to pay the overdraft.","type":"section","prefixes":["a"],"prefix":"a","entire_prefix":"a","prefix_anchor":"a","level":1,"next_prefix":"b"},"1":{"id":199405,"text":"A payor bank is liable to its customer for damages proximately caused by the wrongful dishonor of an item. Liability is limited to actual damages proved and may include damages for an arrest or prosecution of the customer or other consequential damages. Whether any consequential damages are proximately caused by the wrongful dishonor is a question of fact to be determined in each case.","type":"section","prefixes":["b"],"prefix":"b","entire_prefix":"b","prefix_anchor":"b","level":1,"prior_prefix":"a","next_prefix":"c"},"2":{"id":199406,"text":"A payor bank’s determination of the customer’s account balance on which a decision to dishonor for insufficiency of available funds is based may be made at any time between the time the item is received by the payor bank and the time that the payor bank returns the item or gives notice in lieu of return, and no more than one determination need be made. If, at the election of the payor bank, a subsequent balance determination is made for the purpose of reevaluating the bank’s decision to dishonor the item, the account balance at the time is determinative of whether a dishonor for insufficiency of available funds is wrongful.","type":"section","prefixes":["c"],"prefix":"c","entire_prefix":"c","prefix_anchor":"c","level":1,"prior_prefix":"b"}},"ancestry":[{"id":13333,"edition_id":1,"name":"Relationship Between Payor Bank and Its Customer","identifier":"4","label":"part","depth":2,"order_by":1,"parent_id":12768,"metadata":{},"date_created":"2026-06-26 03:44:39","date_modified":"2026-06-26 03:44:39","permalink":{"id":283139,"object_type":"structure","relational_id":13333,"identifier":"4","token":"8.4\/4","url":"\/8.4\/4\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12768,"edition_id":1,"name":"Commercial Code \u2014 Bank Deposits and Collections","identifier":"8.4","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:52","date_modified":"2026-06-26 03:43:52","permalink":{"id":282995,"object_type":"structure","relational_id":12768,"identifier":"8.4","token":"8.4","url":"\/8.4\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":69237,"structure_id":13333,"section_number":"8.4-401","catch_line":"When bank may charge customer's account","url":"\/8.4-401\/","token":"8.4\/4\/8.4-401","metadata":false},{"id":54315,"structure_id":13333,"section_number":"8.4-402","catch_line":"Bank's liability to customer for wrongful dishonor; time of determining insufficiency of account","url":"\/8.4-402\/","token":"8.4\/4\/8.4-402","metadata":false},{"id":67226,"structure_id":13333,"section_number":"8.4-403","catch_line":"Customer's right to stop payment; burden of proof of loss","url":"\/8.4-403\/","token":"8.4\/4\/8.4-403","metadata":false},{"id":86835,"structure_id":13333,"section_number":"8.4-404","catch_line":"Bank not obligated to pay check more than six months old","url":"\/8.4-404\/","token":"8.4\/4\/8.4-404","metadata":false},{"id":78330,"structure_id":13333,"section_number":"8.4-405","catch_line":"Death or incompetence of customer","url":"\/8.4-405\/","token":"8.4\/4\/8.4-405","metadata":false},{"id":56628,"structure_id":13333,"section_number":"8.4-406","catch_line":"Customer's duty to discover and report unauthorized signature or alteration","url":"\/8.4-406\/","token":"8.4\/4\/8.4-406","metadata":false},{"id":57675,"structure_id":13333,"section_number":"8.4-407","catch_line":"Payor bank's right to subrogation on improper payment","url":"\/8.4-407\/","token":"8.4\/4\/8.4-407","metadata":false}],"previous_section":{"id":69237,"structure_id":13333,"section_number":"8.4-401","catch_line":"When bank may charge customer's account","url":"\/8.4-401\/","token":"8.4\/4\/8.4-401","metadata":false},"next_section":{"id":67226,"structure_id":13333,"section_number":"8.4-403","catch_line":"Customer's right to stop payment; burden of proof of loss","url":"\/8.4-403\/","token":"8.4\/4\/8.4-403","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/8.4-402\/","history_text":"

The record of this law\u2019s original creation isn\u2019t available online. It has been modified 2 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 1964, chapter 219; in 1992, chapter 693.<\/p>","references":[{"id":67226,"section_number":"8.4-403","catch_line":"Customer's right to stop payment; burden of proof of loss","order_by":null,"url":"\/8.4-403\/"}],"refers_to":false,"permalink":{"id":283145,"object_type":"law","relational_id":54315,"identifier":"8.4-402","token":"8.4\/4\/8.4-402","url":"\/8.4-402\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/8.4-402\/","token":"8.4\/4\/8.4-402","dublin_core":{"Title":"Bank’s liability to customer for wrongful dishonor; time of determining insufficiency of account","Type":"Text","Format":"text\/html","Identifier":"\u00a7 8.4-402","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

a.<\/span> Except as otherwise provided in this title, a payor bank<\/span> wrongfully dishonors an item if it dishonors an item that is properly payable, but a bank may dishonor an item that would create an overdraft unless it has agreed to pay the overdraft. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

b.<\/span> A payor bank<\/span> is liable to its customer for damages<\/span> proximately caused by the wrongful dishonor of an item. Liability is limited to actual damages<\/span> proved and may include damages<\/span> for an arrest<\/span> or prosecution<\/span> of the customer or other consequential damages<\/span>. Whether any consequential damages<\/span> are proximately caused by the wrongful dishonor is a question of fact<\/span> to be determined in each case. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

c.<\/span> A payor bank<\/span>’s determination of the customer’s account balance on which a decision to dishonor for insufficiency of available funds is based may be made at any time between the time the item is received by the payor bank<\/span> and the time that the payor bank<\/span> returns the item or gives notice in lieu of return, and no more than one determination need be made. If, at the election of the payor bank<\/span>, a subsequent balance determination is made for the purpose of reevaluating the bank’s decision to dishonor the item, the account balance at the time is determinative of whether a dishonor for insufficiency of available funds is wrongful. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nBANK’S LIABILITY TO CUSTOMER FOR WRONGFUL DISHONOR; TIME OF DETERMINING\nINSUFFICIENCY OF ACCOUNT (\u00a7 8.4-402)\n\na. Except as otherwise provided in this title, a payor bank wrongfully dishonors\nan item if it dishonors an item that is properly payable, but a bank may\ndishonor an item that would create an overdraft unless it has agreed to pay the\noverdraft.\n\nb. A payor bank is liable to its customer for damages proximately caused by the\nwrongful dishonor of an item. Liability is limited to actual damages proved and\nmay include damages for an arrest or prosecution of the customer or other\nconsequential damages. Whether any consequential damages are proximately caused\nby the wrongful dishonor is a question of fact to be determined in each case.\n\nc. A payor bank’s determination of the customer’s account balance on\nwhich a decision to dishonor for insufficiency of available funds is based may\nbe made at any time between the time the item is received by the payor bank and\nthe time that the payor bank returns the item or gives notice in lieu of return,\nand no more than one determination need be made. If, at the election of the\npayor bank, a subsequent balance determination is made for the purpose of\nreevaluating the bank’s decision to dishonor the item, the account balance\nat the time is determinative of whether a dishonor for insufficiency of\navailable funds is wrongful.\n\nHISTORY: Code 1950, \u00a7 6-71; 1964, c. 219; 1992, c. 693.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}