Commercial Code section 4109

(a)

Unless otherwise instructed, a collecting bank in a good faith effort to secure payment of a specific item drawn on a payor other than a bank, and with or without the approval of any person involved, may waive, modify, or extend time limits imposed or permitted by this code for a period not exceeding two additional banking days without discharge of drawers or indorsers or liability to its transferor or a prior party.

(b)

Delay by a collecting bank or payor bank beyond time limits prescribed or permitted by this code or by instructions is excused if (1) the delay is caused by interruption of communication or computer facilities, suspension of payments by another bank, war, emergency conditions, failure of equipment, or other circumstances beyond the control of the bank, and (2) the bank exercises such diligence as the circumstances require.

Source: Section 4109, https://leginfo.­legislature.­ca.­gov/faces/codes_displaySection.­xhtml?lawCode=COM§ionNum=4109.­ (accessed May 14, 2025).

Last Updated

May 12, 2025

§ 4109’s source at ca​.gov