                                 CODE OF VIRGINIA

CHOICE OF LAW (§ 8.4A-507)

a. The following rules apply unless the affected parties otherwise agree or
subsection (c) of this section applies:

   1. The rights and obligations between the sender of a payment order and the
   receiving bank are governed by the law of the jurisdiction in which the
   receiving bank is located.

   2. The rights and obligations between the beneficiary&#8217;s bank and the
   beneficiary are governed by the law of the jurisdiction in which the
   beneficiary&#8217;s bank is located.

   3. The issue of when payment is made pursuant to a funds transfer by the
   originator to the beneficiary is governed by the law of the jurisdiction in
   which the beneficiary&#8217;s bank is located.

b. If the parties described in each subdivision of subsection (a) of this
section have made an agreement selecting the law of a particular jurisdiction to
govern rights and obligations between each other, the law of that jurisdiction
governs those rights and obligations, whether or not the payment order or the
funds transfer bears a reasonable relation to that jurisdiction.

c. A funds-transfer system rule may select the law of a particular jurisdiction
to govern (i) rights and obligations between participating banks with respect to
payment orders transmitted or processed through the system, or (ii) the rights
and obligations of some or all parties to a funds transfer any part of which is
carried out by means of the system. A choice of law made pursuant to clause (i)
of this subsection is binding on participating banks. A choice of law made
pursuant to clause (ii) of this subsection is binding on the originator, other
sender, or a receiving bank having notice that the funds-transfer system might
be used in the funds transfer and of the choice of law by the system which the
originator, other sender, or receiving bank issued or accepted a payment order.
The beneficiary of a funds transfer is bound by the choice of law if, when the
funds transfer is initiated, the beneficiary has notice that the funds transfer
system might be used in the funds transfer and of the choice of law by the
system. The law of a jurisdiction selected pursuant to this subsection may
govern, whether or not that law bears a reasonable relation to the matter in
issue.

d. In the event of inconsistency between an agreement under subsection (b) of
this section, and a choice-of-law rule under subsection (c) of this section, the
agreement under subsection (b) of this section prevails.

e. If a funds transfer is made by use of more than one funds-transfer system and
there is inconsistency between choice-of-law rules of the systems, the matter in
issue is governed by the law of the selected jurisdiction that has the most
significant relationship to the matter in issue.

HISTORY: 1990, c. 9.