554.12211 Cancellation and amendment of payment order. 1. A communication of the sender of a payment order canceling or amending the order may be transmitted to the receiving bank orally, electronically, or in writing. If a securityprocedure is in effect between the sender and the receiving bank, the communication is noteffective to cancel or amend the order unless the communication is verified pursuant to thesecurity procedure or the bank agrees to the cancellation or amendment. 2. Subject to subsection 1, a communication by the sender canceling or amending a payment order is effective to cancel or amend the order if notice of the communication isreceived at a time and in a manner affording the receiving bank a reasonable opportunity toact on the communication before the bank accepts the payment order. 3. After a payment order has been accepted, cancellation or amendment of the order is not effective unless the receiving bank agrees or a funds-transfer system rule allows cancellationor amendment without agreement of the bank. a. With respect to a payment order accepted by a receiving bank other than the beneficiary’s bank, cancellation or amendment is not effective unless a ationor amendment without agreement of the bank. a. With respect to a payment order accepted by a receiving bank other than the beneficiary’s bank, cancellation or amendment is not effective unless a conformingcancellation or amendment of the payment order issued by the receiving bank is also made. b. With respect to a payment order accepted by the beneficiary’s bank, cancellation or amendment is not effective unless the order was issued in execution of an unauthorizedpayment order, or because of a mistake by a sender in the funds transfer which resultedin the issuance of a payment order that is a duplicate of a payment order previously issuedby the sender, that orders payment to a beneficiary not entitled to receive payment from theoriginator, or that orders payment in an amount greater than the amount the beneficiarywas entitled to receive from the originator. If the payment order is canceled or amended,the beneficiary’s bank is entitled to recover from the beneficiary any amount paid to thebeneficiary to the extent allowed by the law governing mistake and restitution. 4. An unaccepted payment order is canceled by operation of law at the close of the fifth funds-transfer ount paid to thebeneficiary to the extent allowed by the law governing mistake and restitution. 4. An unaccepted payment order is canceled by operation of law at the close of the fifth funds-transfer business day of the receiving bank after the execution date or payment dateof the order. 5. A canceled payment order cannot be accepted. If an accepted payment order is canceled, the acceptance is nullified and no person has any right or obligation based on theacceptance. Amendment of a payment order is deemed to be cancellation of the originalorder at the time of amendment and issuance of a new payment order in the amended format the same time. 6. Unless otherwise provided in an agreement of the parties or in a funds-transfer system rule, if the receiving bank, after accepting a payment order, agrees to cancellationor amendment of the order by the sender or is bound by a funds-transfer system ruleallowing cancellation or amendment without the bank’s agreement, the sender, whether ornot cancellation or amendment is effective, is liable to the bank for any loss and expenses,including reasonable attorney’s fees, incurred by the bank as a result of the cancellation oramendment or ornot cancellation or amendment is effective, is liable to the bank for any loss and expenses,including reasonable attorney’s fees, incurred by the bank as a result of the cancellation oramendment or attempted cancellation or amendment. 7. A payment order is not revoked by the death or legal incapacity of the sender unless the receiving bank knows of the death or of an adjudication of incapacity by a court of competentjurisdiction and has reasonable opportunity to act before acceptance of the order. 8. A funds-transfer system rule is not effective to the extent it conflicts with subsection 3, paragraph 'b'. 92 Acts, ch 1146, §19Referred to in §554.12209, 554.12210, 554.12404, 554.12406 Sat Dec 23 11:02:53 2023 Iowa Code 2024, Section 554.12211 (24, 0)
Iowa Legal Code