554.4202 Responsibility for collection or return — when action timely. 1. A collecting bank must exercise ordinary care in:a. presenting an item or sending it for presentment;b. sending notice of dishonor or nonpayment or returning an item other than a documentary draft to the bank’s transferor after learning that the item has not been paid oraccepted, as the case may be; c. settling for an item when the bank receives final settlement; andd. notifying its transferor of any loss or delay in transit within a reasonable time after discovery thereof. 2. A collecting bank exercises ordinary care under subsection 1 by taking proper action before its midnight deadline following receipt of an item, notice, or settlement. Taking properaction within a reasonably longer time may constitute the exercise of ordinary care, but thebank has the burden of establishing timeliness. 3. Subject to subsection 1, paragraph 'a', a bank is not liable for the insolvency, neglect, misconduct, mistake, or default of another bank or person or for loss or destruction of anitem in the possession of others or in transit. agraph 'a', a bank is not liable for the insolvency, neglect, misconduct, mistake, or default of another bank or person or for loss or destruction of anitem in the possession of others or in transit. [C66, 71, 73, 75, 77, 79, 81, §554.4202]94 Acts, ch 1167, §89, 122 Sat Dec 23 01:57:19 2023 Iowa Code 2024, Section 554.4202 (24, 0)
Iowa Legal Code