                                 CODE OF VIRGINIA

OBLIGATIONS OF RECEIVING BANK IN EXECUTION OF PAYMENT ORDER (§ 8.4A-302)

a. Except as provided in subsections (b) through (d) of this section, if the
receiving bank accepts a payment order pursuant to subsection (a) of §
8.4A-209, the bank has the following obligations in executing the order:

   1. The receiving bank is obliged to issue, on the execution date, a payment
   order complying with the sender&#8217;s order and to follow the sender&#8217;s
   instructions concerning (i) any intermediary bank or funds-transfer system to
   be used in carrying out the funds transfer, or (ii) the means by which payment
   orders are to be transmitted in the funds transfer. If the originator&#8217;s
   bank issues a payment order to an intermediary bank, the originator&#8217;s
   bank is obliged to instruct the intermediary bank according to the instruction
   of the originator. An intermediary bank in the funds transfer is similarly
   bound by an instruction given to it by the sender of the payment order it
   accepts.

   2. If the sender&#8217;s instruction states that the funds transfer is to be
   carried out telephonically or by wire transfer or otherwise indicates that the
   funds transfer is to be carried out by the most expeditious means, the
   receiving bank is obliged to transmit its payment order by the most
   expeditious available means, and to instruct any intermediary bank
   accordingly. If a sender&#8217;s instruction states a payment date, the
   receiving bank is obliged to transmit its payment order at a time and by means
   reasonably necessary to allow payment to the beneficiary on the payment date
   or as soon thereafter as is feasible.

b. Unless otherwise instructed, a receiving bank executing a payment order may
(i) use any funds-transfer system if use of that system is reasonable in the
circumstances, and (ii) issue a payment order to the beneficiary&#8217;s bank or
to an intermediary bank through which a payment order conforming to the
sender&#8217;s order can expeditiously be issued to the beneficiary&#8217;s bank
if the receiving bank exercises ordinary care in the selection of the
intermediary bank. A receiving bank is not required to follow an instruction of
the sender designating a funds-transfer system to be used in carrying out the
funds transfer if the receiving bank, in good faith, determines that it is not
feasible to follow the instruction or that following the instruction would
unduly delay completion of the funds transfer.

c. Unless subdivision (a) (2) of this section applies or the receiving bank is
otherwise instructed, the bank may execute a payment order by transmitting its
payment order by first class mail or by any means reasonable in the
circumstances. If the receiving bank is instructed to execute the sender&#8217;s
order by transmitting its payment order by a particular means, the receiving
bank may issue its payment order by the means stated or by any means as
expeditious as the means stated.

d. Unless instructed by the sender, (i) the receiving bank may not obtain
payment of its charges for services and expenses in connection with the
execution of the sender&#8217;s order by issuing a payment order in an amount
equal to the amount of the sender&#8217;s order less the amount of the charges,
and (ii) may not instruct a subsequent receiving bank to obtain payment of its
charges in the same manner.

HISTORY: 1990, c. 9.