§ 554.12303

554.12303 Erroneous execution of payment order. 1. A receiving bank that executes the payment order of the sender by issuing a payment order in an amount greater than the amount of the sender’s order, or that issues a paymentorder in execution of the sender’s order and then issues a duplicate order, is entitled topayment of the amount of the sender’s order under section 554.12402, subsection 3, if theprovisions of that subsection are otherwise satisfied. The bank is entitled to recover fromthe beneficiary of the erroneous order the excess payment received to the extent allowedby the law governing mistake and restitution. 2. A receiving bank that executes the payment order of the sender by issuing a payment order in an amount less than the amount of the sender’s order is entitled to payment of theamount of the sender’s order under section 554.12402, subsection 3, if the provisions of thatsubsection are otherwise satisfied and the bank corrects the error by issuing an additionalpayment order for the benefit of the beneficiary of the sender’s order. If the error is notcorrected, the issuer of the erroneous order is entitled to receive or retain payment from thesender of the order

nt order for the benefit of the beneficiary of the sender’s order. If the error is notcorrected, the issuer of the erroneous order is entitled to receive or retain payment from thesender of the order only to the extent of the amount of the erroneous order. This subsectiondoes not apply if the receiving bank executes the sender’s payment order by issuing apayment order in an amount less than the amount of the sender’s order for the purpose ofobtaining payment of the receiving bank’s charges for services and expenses pursuant toinstruction of the sender. 3. If a receiving bank executes the payment order of the sender by issuing a payment order to a beneficiary different from the beneficiary of the sender’s order and the fundstransfer is completed on the basis of that error, the sender of the payment order that waserroneously executed and all previous senders in the funds transfer are not obligated to paythe payment orders they issued. The issuer of the erroneous order is entitled to recover fromthe beneficiary of the payment order issued the payment received to the extent allowed bythe law governing mistake and restitution.

ssued. The issuer of the erroneous order is entitled to recover fromthe beneficiary of the payment order issued the payment received to the extent allowed bythe law governing mistake and restitution. 92 Acts, ch 1146, §23Referred to in §554.12304, 554.12402 Sat Dec 23 11:02:55 2023 Iowa Code 2024, Section 554.12303 (24, 0)