810 ILCS 5/4A-405
2021 Illinois Compiled Statutes|Chapter 810 - COMMERCIAL CODE|810 ILCS 5/ - Uniform Commercial Code.|Article 4A - Funds Transfers

 (from Ch. 26, par. 4A-405)Sec. 4A-405.     Payment by beneficiary's bank to beneficiary.(a) If the beneficiary's bank credits an account of the beneficiary of a  payment order, payment of the bank's obligation under Section  4A-404(a) occurs when and to the extent (i) the beneficiary is notified of  the right to withdraw the credit, (ii) the bank lawfully applies the credit  to a debt of the beneficiary, or (iii) funds with respect to the order are  otherwise made available to the beneficiary by the bank.(b) If the beneficiary's bank does not credit an account of the  beneficiary of a payment order, the time when payment of the bank's  obligation under Section 4A-404(a) occurs is governed by principles of law  that determine when an obligation is satisfied.(c) Except as stated in subsections (d) and (e), if the beneficiary's  bank pays the beneficiary of a payment order under a condition to payment  or agreement of the beneficiary giving the bank the right to recover  payment from the beneficiary if the bank does not receive payment of the  order, the condition to payment or agreement is not enforceable.(d) A funds transfer system rule may provide that payments made to  beneficiaries of funds transfers made through the system are provisional  until receipt of payment by the beneficiary's bank of the payment order it  accepted.  A beneficiary's bank that makes a payment that is provisional  under the rule is entitled to refund from the beneficiary if (i) the rule  requires that both the beneficiary and the originator be given notice of  the provisional nature of the payment before the funds transfer is  initiated, (ii) the beneficiary, the beneficiary's bank and the  originator's bank agreed to be bound by the rule, and (iii) the  beneficiary's bank did not receive payment of the payment order that it  accepted.  If the beneficiary is obliged to refund payment to the  beneficiary's bank, acceptance of the payment order by the beneficiary's  bank is nullified and no payment by the originator of the funds transfer to  the beneficiary occurs under Section 4A-406.(e) This subsection applies to a funds transfer that includes a payment  order transmitted over a funds transfer system that (i) nets obligations  multilaterally among participants, and (ii) has in effect a loss sharing  agreement among participants for the purpose of providing funds necessary  to complete settlement of the obligations of one or more participants that  do not meet their settlement obligations.  If the beneficiary's bank in the  funds transfer accepts a payment order and the system fails to complete  settlement pursuant to its rules with respect to any payment order in the  funds transfer, (i) the acceptance by the beneficiary's bank is nullified  and no person has any right or obligation based on the acceptance, (ii) the  beneficiary's bank is entitled to recover payment from the beneficiary,  (iii) no payment by the originator to the beneficiary occurs under Section  4A-406, and (iv) subject to Section 4A-402(e), each sender in the funds  transfer is excused from its obligation to pay its payment order under  Section 4A-402(c) because the funds transfer has not been completed.    (Source: P.A. 86-1291.)