SB358,82,8
1404.212 (title) Presentment by notice of item not payable by, through
2or at a bank; liability of
secondary parties drawer or endorser. (1) Unless
3otherwise instructed, a collecting bank may present an item not payable by, through
4or at a bank by sending to the party to accept or pay a written notice that the bank
5holds the item for acceptance or payment. The notice must be sent in time to be
6received on or before the day when presentment is due and the bank must meet any
7requirement of the party to accept or pay under s. 403.505 403.501 by the close of the
8bank's next banking day after it knows of the requirement.
SB358,82,15 9(2) Where If presentment is made by notice and neither honor nor payment,
10acceptance or
request for compliance with a requirement under s. 403.505 403.501
11is not received by the close of business on the day after maturity or, in the case of
12demand items, by the close of business on the third 3rd banking day after notice was
13sent, the presenting bank may treat the item as dishonored and charge any
14secondary party drawer or endorser by sending the secondary party it notice of the
15facts.
SB358, s. 52 16Section 52. 404.211 of the statutes is repealed.
SB358, s. 53 17Section 53. 404.212 (title), (1) and (2) to (5) of the statutes are renumbered
18404.214 (title), (1) and (3) to (6), and 404.214 (title), (1), (3), (4) and (6), as
19renumbered, are amended to read:
SB358,83,8 20404.214 (title) Right of charge-back or refund; liability of collecting
21bank; return of item
. (1) If a collecting bank has made provisional settlement with
22its customer for an item and itself fails by reason of dishonor, suspension of payments
23by a bank or otherwise to receive a settlement for the item which is or becomes final,
24the bank may revoke the settlement given by it, charge-back charge back the amount
25of any credit given for the item to its customer's account, or obtain refund from its

1customer, whether or not it is able to return the items item, if by its midnight
2deadline or within a longer reasonable time after it learns the facts it returns the
3item or sends notification of the facts. If the return or notice is delayed beyond the
4bank's midnight deadline or a longer reasonable time after it learns the facts, the
5bank may revoke the settlement, charge back the credit or obtain a refund from its
6customer, but it is liable for any loss resulting from the delay.
These rights to revoke,
7charge-back and obtain refund terminate if and when a settlement for the item
8received by the bank is or becomes final (ss. 404.211 (3) and 404.213 (2) and (3)).
SB358,83,12 9(3) A depositary bank which that is also the payor payer may charge-back
10charge back the amount of an item to its customer's account or obtain refund in
11accordance with s. 404.301 governing return of an item received by a payor payer
12bank for credit on its books.
SB358,83,13 13(4) The right to charge-back is not affected by any of the following:
SB358,83,1414 (a) Prior Previous use of the a credit given for the item; or .
SB358,83,1615 (b) Failure by any bank to exercise ordinary care with respect to the item, but
16any a bank so failing remains liable.
SB358,83,21 17(6) If credit is given in dollars as the equivalent of the value of an item payable
18in a foreign currency money, the dollar amount of any charge-back or refund shall
19must be calculated on the basis of the buying sight bank-offered spot rate for the
20foreign currency money prevailing on the day when the person entitled to the
21charge-back or refund learns that it will not receive payment in ordinary course.
SB358, s. 54 22Section 54. 404.212 (1m) of the statutes is repealed.
SB358, s. 55 23Section 55. 404.213 (title) and (1) (intro.), (a), (b) and (d) of the statutes are
24renumbered 404.215 (title) and (1) (intro.), (a), (b) and (c), and 404.215 (title) and (1)
25(intro.) and (a) and (b), as renumbered, are amended to read:
SB358,84,4
1404.215 (title) Final payment of item by payor payer bank; when
2provisional debits and credits become final; when certain credits become
3available for withdrawal.
(1) (intro.) An item is finally paid by a payor payer
4bank when the bank has first done any of the following , whichever happens first:
SB358,84,55 (a) Paid the item in cash; or.
SB358,84,86 (b) Settled for the item without reserving having a right to revoke the
7settlement and without having such right under statute, clearinghouse rule or
8agreement; or.
SB358, s. 56 9Section 56. 404.213 (1) (c) of the statutes is repealed.
SB358, s. 57 10Section 57. 404.213 (1a) of the statutes is repealed.
SB358, s. 58 11Section 58. 404.213 (2) to (4), (4m) and (5) of the statutes are renumbered
12404.215 (3) to (5), (5m) and (6), and 404.215 (3), (4), (5), (5m) (a) and (b) 1., 2. and 3.
13and (6), as renumbered, are amended to read:
SB358,84,1914 404.215 (3) If provisional settlement for an item between the presenting and
15payor payer banks is made through a clearinghouse or by debits or credits in an
16account between them, then to the extent that provisional debits or credits for the
17item are entered in accounts between the presenting and payor payer banks or
18between the presenting and successive prior collecting banks in a series, they become
19final upon final payment of the item by the payor payer bank.
SB358,84,2320 404.215 (4) If a collecting bank receives a settlement for an item which is or
21becomes final (ss. 404.211 (3) and 404.213 (2)), the bank is accountable to its
22customer for the amount of the item and any provisional credit given for the item in
23an account with its customer becomes final.
SB358,85,2 24(5) Subject to applicable law stating a time for availability of funds and to any
25right of the bank to apply the credit to an obligation of the customer, credit given by

1a bank for an item in an a customer's account with its customer becomes available
2for withdrawal as of right:
SB358,85,63 (a) In any case where If the bank has received a provisional settlement for the
4item,—when such when the settlement becomes final and the bank has had a
5reasonable time to learn that the settlement is final; receive return of the item and
6the item has not been received within that time.
SB358,85,97 (b) In any case where If the bank is both a the depositary bank and a payor the
8payer
bank and the item is finally paid,—at at the opening of the bank's second 2nd
9banking day following receipt of the item.
SB358,85,11 10(5m) (a) As used in In this subsection, "banking day" means a business day as
11defined in s. 421.301 (6) that is not a federal legal holiday.
SB358,85,1712 (b) 1. If the item is a check or draft endorsed only by the person to whom it was
13issued and is drawn on the treasury of the United States, the this state of Wisconsin
14or any unit of local government located in this state, after not more than one banking
15day has intervened between the banking day on which the check or draft is received
16at the proof and transit facility of the depository and the banking day on which the
17funds are available for withdrawal.
SB358,85,2118 2. If the payor payer bank or other financial institution is located in this state,
19after not more than 4 banking days have intervened between the banking day on
20which the item is received at the proof and transit facility of the depository and the
21banking day on which the funds are available for withdrawal.
SB358,85,2522 3. If the payor payer bank or other financial institution is located in any other
23state, after not more than 7 banking days have intervened between the banking day
24on which the item is received at the proof and transit facility of the depository and
25the banking day on which the funds are available for withdrawal.
SB358,86,5
1(6) A deposit of money in a bank is final when made but, subject to Subject to
2applicable law stating a time for availability of funds and
any right of the a bank to
3apply the a deposit to an obligation of the customer, the depositor, a deposit of money
4becomes available for withdrawal as of right at the opening of the bank's next
5banking day following after receipt of the deposit.
SB358, s. 59 6Section 59. 404.213 of the statutes is created to read:
SB358,86,10 7404.213 Medium and time of settlement by bank. (1) With respect to
8settlement by a bank, the medium and time of settlement may be prescribed by
9federal reserve regulations or circulars, clearinghouse rules and the like, or
10agreement. In the absence of such prescription, all of the following apply:
SB358,86,1211 (a) The medium of settlement is cash or credit to an account in a federal reserve
12bank of or specified by the person to receive settlement.
SB358,86,1313 (b) The time of settlement is:
SB358,86,1514 1. With respect to tender of settlement by cash, a cashier's check, or teller's
15check, when the cash or check is sent or delivered.
SB358,86,1716 2. With respect to tender of settlement by credit in an account in a federal
17reserve bank, when the credit is made.
SB358,86,2018 3. With respect to tender of settlement by a credit or debit to an account in a
19bank, when the credit or debit is made or, in the case of tender of settlement by
20authority to charge an account, when the authority is sent or delivered.
SB358,86,2221 4. With respect to tender of settlement by a funds transfer, when payment is
22made pursuant to s. 410.406 (1) to the person receiving settlement.
SB358,86,25 23(2) If the tender of settlement is not by a medium authorized by sub. (1) or the
24time of settlement is not fixed by sub. (1), no settlement occurs until the tender of
25settlement is accepted by the person receiving settlement.
SB358,87,2
1(3) If settlement for an item is made by cashier's check or teller's check and the
2person receiving settlement, before its midnight deadline does any of the following:
SB358,87,43 (a) Presents or forwards the check for collection, settlement is final when the
4check is finally paid.
SB358,87,65 (b) Fails to present or forward the check for collection, settlement is final at the
6midnight deadline of the person receiving settlement.
SB358,87,10 7(4) If settlement for an item is made by giving authority to charge the account
8of the bank giving settlement in the bank receiving settlement, settlement is final
9when the charge is made by the bank receiving settlement if there are funds
10available in the account for the amount of the item.
SB358, s. 60 11Section 60. 404.214 of the statutes is renumbered 404.216 and amended to
12read:
SB358,87,17 13404.216 Insolvency and preference. (1) Any If an item is in or coming
14comes into the possession of a payor payer or collecting bank which that suspends
15payment and which the item is has not been finally paid shall, the item must be
16returned by the receiver, trustee or agent in charge of the closed bank to the
17presenting bank or the closed bank's customer.
SB358,87,21 18(2) If a payor payer bank finally pays an item and suspends payments without
19making a settlement for the item with its customer or the presenting bank which
20settlement is or becomes final, the owner of the item has a preferred claim against
21the payor payer bank.
SB358,88,2 22(3) If a payor payer bank gives or a collecting bank gives or receives a
23provisional settlement for an item and thereafter suspends payments, the
24suspension does not prevent or interfere with the settlement settlement's becoming

1final if such the finality occurs automatically upon the lapse of certain time or the
2happening of certain events (ss. 404.211 (3) and 404.213 (1) (d), (2) and (3)).
SB358,88,6 3(4) If a collecting bank receives from subsequent parties settlement for an item,
4which settlement is or becomes final and the bank suspends payments without
5making a settlement for the item with its customer which settlement is or becomes
6final, the owner of the item has a preferred claim against such the collecting bank.
SB358, s. 61 7Section 61. 404.214 (2) of the statutes is created to read:
SB358,88,98 404.214 (2) A collecting bank returns an item when it is sent or delivered to the
9bank's customer or transferor or pursuant to its instructions.
SB358, s. 62 10Section 62. 404.215 (2) of the statutes is created to read:
SB358,88,1211 404.215 (2) If provisional settlement for an item does not become final, the item
12is not finally paid.
SB358, s. 63 13Section 63. The unnumbered subchapter title preceding 404.301 of the
14statutes is numbered subchapter III (title) of chapter 404 and amended to read:
SB358,88,1715 Subchapter III
16 Collection of items: payor
17payer banks
SB358, s. 64 18Section 64. 404.301 of the statutes is amended to read:
SB358,89,2 19404.301 (title) Deferred posting; recovery of payment by return of
20items; time of dishonor
; return of items by payer bank. (1) Where an
21authorized settlement
If a payor bank settles for a demand item (other than a
22documentary draft) received by a payor bank presented otherwise than for
23immediate payment over the counter has been made before midnight of the banking
24day of receipt, the payor payer bank may revoke the settlement and recover any

1payment
the settlement if, before it has made final payment (s. 404.213 (1)) and
2before its midnight deadline, it does any of the following:
SB358,89,33 (a) Returns the item; or.
SB358,89,54 (b) Sends written notice of dishonor or nonpayment if the item is held for
5protest or is otherwise
unavailable for return.
SB358,89,9 6(2) If a demand item is received by a payor payer bank for credit on its books,
7it may return such the item or send notice of dishonor and may revoke any credit
8given or recover the amount thereof withdrawn by its customer, if it acts within the
9time limit and in the manner specified in sub. (1).
SB358,89,12 10(3) Unless previous notice of dishonor has been sent , an item is dishonored at
11the time when for purposes of dishonor it is returned or notice sent in accordance with
12this section.
SB358,89,13 13(4) An item is returned:
SB358,89,1614 (a) As to an item received presented through a clearinghouse, when it is
15delivered to the presenting or last collecting bank or to the clearinghouse or is sent
16or delivered in accordance with its clearinghouse rules; or.
SB358,89,1817 (b) In all other cases, when it is sent or delivered to the bank's customer or
18transferor or pursuant to the customer's or transferor's instructions.
SB358, s. 65 19Section 65. 404.302 (title) of the statutes is amended to read:
SB358,89,20 20404.302 (title) Payor Payer bank's responsibility for late return of item.
SB358, s. 66 21Section 66. 404.302 of the statutes is renumbered 404.302 (1) and amended
22to read:
SB358,90,223 404.302 (1) In the absence of a valid defense such as breach of a presentment
24warranty under s. 404.207 (1), settlement effected or the like, if
If an item is

1presented on to and received by a payor payer bank, the bank is accountable for the
2amount of any of the following:
SB358,90,73 (a) A demand item, other than a documentary draft , whether properly payable
4or not, if the bank, in any case where in which it is not also the depositary bank,
5retains the item beyond midnight of the banking day of receipt without settling for
6it or, regardless of whether or not it is also the depositary bank, does not pay or return
7the item or send notice of dishonor until after its midnight deadline ; or.
SB358,90,108 (b) Any other properly payable item, unless within the time allowed for
9acceptance or payment of that item, the bank either accepts or pays the item or
10returns it and accompanying documents.
SB358, s. 67 11Section 67. 404.302 (2) of the statutes is created to read:
SB358,90,1512 404.302 (2) The liability of a payer bank to pay an item under sub. (1) is subject
13to defenses based on breach of a presentment warranty or proof that the person
14seeking enforcement of the liability presented or transferred the item for the purpose
15of defrauding the payer bank.
SB358, s. 68 16Section 68. 404.303 (title) and (1) (intro.) and (a) to (c) of the statutes are
17amended to read:
SB358,91,2 18404.303 (title) When items subject to notice, stop-order stop-payment
19order
, legal process or setoff; order in which items may be charged or
20certified.
(1) (intro.) Any knowledge, notice or stop-order stop-payment order
21received by, legal process served upon or setoff exercised by a payor payer bank,
22whether or not effective under other rules of law
comes too late to terminate, suspend
23or modify the bank's right or duty to pay an item or to charge its customer's account
24for the item, comes too late to so terminate, suspend or modify such right or duty if
25the knowledge, notice, stop-order stop-payment order or legal process is received or

1served and a reasonable time for the bank to act thereon expires or the setoff is
2exercised after the bank has done any earliest of the following:
SB358,91,33 (a) Accepted or certified The bank accepts or certifies the item;.
SB358,91,44 (b) Paid The bank pays the item in cash;.
SB358,91,75 (c) Settled The bank settles for the item without reserving having a right to
6revoke the settlement and without having such right under statute, clearinghouse
7rule or agreement;.
SB358, s. 69 8Section 69. 404.303 (1) (d) of the statutes is repealed.
SB358, s. 70 9Section 70. 404.303 (1) (e) of the statutes is renumbered 404.303 (1) (d) and
10amended to read:
SB358,91,1311 404.303 (1) (d) Become The bank becomes accountable for the amount of the
12item under ss. 404.213 (1) (d) and s. 404.302 dealing with the payor payer bank's
13responsibility for late return of items.
SB358, s. 71 14Section 71. 404.303 (1) (e) of the statutes is created to read:
SB358,91,1915 404.303 (1) (e) With respect to checks, a cutoff hour no earlier than one hour
16after the opening of the next banking day after the banking day on which the bank
17received the check and no later than the close of that next banking day or, if no cutoff
18hour is fixed, the close of the next banking day after the banking day on which the
19bank received the check.
SB358, s. 72 20Section 72. 404.303 (2) of the statutes is amended to read:
SB358,91,2221 404.303 (2) Subject to sub. (1), items may be accepted, paid, certified or charged
22to the indicated account of its customer in any order convenient to the bank.
SB358, s. 73 23Section 73. The unnumbered subchapter title preceding 404.401 of the
24statutes is numbered subchapter IV (title) of chapter 404 and amended to read:
SB358,92,3
1Subchapter IV
2 Relationship between payor payer
3 bank and its customer
SB358, s. 74 4Section 74. 404.401 (1) of the statutes is amended to read:
SB358,92,95 404.401 (1) As against its customer, a A bank may charge against the
6customer's account any of a customer an item which that is otherwise properly
7payable from that account even though the charge creates an overdraft. An item is
8properly payable if it is authorized by the customer and is in accordance with any
9agreement between the customer and bank.
SB358, s. 75 10Section 75. 404.401 (2) of the statutes is renumbered 404.401 (4) and amended
11to read:
SB358,92,1312 404.401 (4) A bank which that in good faith makes payment to a holder may
13charge the indicated account of its customer according to any of the following:
SB358,92,1414 (a) The original tenor terms of the customer's altered item; or.
SB358,92,1715 (b) The tenor terms of the customer's completed item, even though the bank
16knows the item has been completed unless the bank has notice that the completion
17was improper.
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