reglab/statecodes huggingface dataset:
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 3 - Negotiable Instruments › Part 5 - DISHONOR › Section 55-3-505 - Evidence of dishonor.

(a) The following are admissible as evidence and create a presumption of dishonor and of any notice of dishonor stated:
(1) a document regular in form as provided in Subsection (b) which purports to be a protest;
(2) a purported stamp or writing of the drawee, payor bank, or presenting bank on or accompanying the instrument stating that acceptance or payment has been refused unless reasons for the refusal are stated and the reasons are not consistent with dishonor; and
(3) a book or record of the drawee, payor bank, or collecting bank, kept in the usual course of business which shows dishonor, even if there is no evidence of who made the entry.
(b) A protest is a certificate of dishonor made by a United States consul or vice consul, or a notary public or other person authorized to administer oaths by the law of the place where dishonor occurs. It may be made upon information satisfactory to that person. The protest must identify the instrument and certify either that presentment has been made or, if not made, the reason why it was not made, and that the instrument has been dishonored by nonacceptance or nonpayment. The protest may also certify that notice of dishonor has been given to some or all parties.
History:
1978 Comp., § 55-3-505, enacted by Laws 1992, ch. 114, § 150.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
Protest is no longer mandatory and must be requested by the holder. Even if requested, protest is not a condition to the liability of indorsers or drawers. Protest is a service provided by the banking system to establish that dishonor has occurred. Like other services provided by the banking system, it will be available if market incentives, interbank agreements, or governmental regulations require it, but liabilities of parties no longer rest on it. Protest may be a requirement for liability on international drafts governed by foreign law which this Article cannot affect.
ANNOTATIONS
Repeals.
— Laws 1992, ch. 114, § 237 repealed former 55-3-505 NMSA 1978, as enacted by Laws 1961, ch. 96, § 3-505, relating to rights of party to whom presentment is made, effective July 1, 1992. Laws 1992, ch. 114, § 150, enacted a new section, effective July 1, 1992. For provisions of former section,
see
the 1991 NMSA 1978 on
NMOneSource.com
.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 3 - Negotiable Instruments › Part 5 - DISHONOR › Section 55-3-506 to 55-3-511 - Repealed.

ANNOTATIONS
Repeals.
— Laws 1992, ch. 114, § 237A repealed 55-3-506 to 55-3-511 NMSA 1978, as enacted by Laws 1961, ch. 96, §§ 3-506 to 3-511, effective July 1, 1992. For former provisions,
see
the 1991 NMSA 1978 on
NMOneSource.com
.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 3 - Negotiable Instruments › Part 6 - DISCHARGE AND PAYMENT › Section 55-3-603 - Tender of payment.

(a) If tender of payment of an obligation to pay an instrument is made to a person entitled to enforce the instrument, the effect of tender is governed by principles of law applicable to tender of payment under a simple contract.
(b) If tender of payment of an obligation to pay an instrument is made to a person entitled to enforce the instrument and the tender is refused, there is discharge, to the extent of the amount of the tender, of the obligation of an indorser or accommodation party having a right of recourse with respect to the obligation to which the tender relates.
(c) If tender of payment of an amount due on an instrument is made to a person entitled to enforce the instrument, the obligation of the obligor to pay interest after the due date on the amount tendered is discharged. If presentment is required with respect to an instrument and the obligor is able and ready to pay on the due date at every place of payment stated in the instrument, the obligor is deemed to have made tender of payment on the due date to the person entitled to enforce the instrument.
History:
1978 Comp., § 55-3-603, enacted by Laws 1992, ch. 114, § 153.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
Section 3-603 [55-3-603 NMSA 1978] replaces former Section 3-604. Subsection (a) generally incorporates the law of tender of payment applicable to simple contracts. Subsections (b) and (c) state particular rules. Subsection (b) replaces former Section 3-604(2). Under Subsection (b) refusal of a tender of payment discharges any indorser or accommodation party having a right of recourse against the party making the tender. Subsection (c) replaces former Section 3-604(1) and (3).
ANNOTATIONS
Repeals.
— Laws 1992, ch. 114, § 237 repealed former 55-3-603 NMSA 1978, as enacted by Laws 1961, ch. 96, § 3-603, relating to payment or satisfaction, effective July 1, 1992. Laws 1992, ch. 114, § 153, enacted a new section, effective July 1, 1992. For provisions of former section,
see
the 1991 NMSA 1978 on
NMOneSource.com
. For present comparable provisions,
see
55-3-602 NMSA 1978.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 3 - Negotiable Instruments › Part 6 - DISCHARGE AND PAYMENT › Section 55-3-604 - Discharge by cancellation or renunciation. (Effective January 1, 2024.)

(a) A person entitled to enforce an instrument, with or without consideration, may discharge the obligation of a party to pay the instrument: (i) by an intentional voluntary act, such as surrender of the instrument to the party; destruction, mutilation or cancellation of the instrument; cancellation or striking out of the party's signature; or the addition of words to the instrument indicating discharge; or (ii) by agreeing not to sue or otherwise renouncing rights against the party by a signed record. The obligation of a party to pay a check is not discharged solely by destruction of the check in connection with a process in which information is extracted from the check and an image of the check is made and, subsequently, the information and image are transmitted for payment.
(b) Cancellation or striking out of an indorsement pursuant to Subsection (a) of this section does not affect the status and rights of a party derived from the indorsement.
History:
1978 Comp., § 55-3-604, enacted by Laws 1992, ch. 114, § 154; 2009, ch. 234, § 10; 2023, ch. 142, § 24.
ANNOTATIONS
The 2023 amendment,
effective January 1, 2024, clarified that the obligation to pay a check is not discharged solely by destruction of the check in connection with certain processes, and removed a provision related to conduct that constitutes signing with respect to a record that is not a writing; in Subsection (a), added "The obligation of a party to pay a check is not discharged solely by destruction of the check in connection with a process in which information is extracted from the check and an image of the check is made and, subsequently, the information and image are transmitted for payment."; and deleted Subsection (c), which provided "As used in this section, 'signed' with respect to a record that is not a writing includes the attachment to or logical association with the record of an electronic symbol, sound or process with the present intent to adopt or accept the record.".
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 3 - Negotiable Instruments › Part 6 - DISCHARGE AND PAYMENT › Section 55-3-606 - Repealed.

ANNOTATIONS
Repeals.
— Laws 1992, ch. 114, § 237A repeals 55-3-606 NMSA 1978, as enacted by Laws 1961, ch. 96, § 3-606, relating to impairment of recourse or collateral, effective July 1, 1992. For provisions of former section,
see
the 1991 NMSA on
NMOneSource.com
.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 3 - Negotiable Instruments › Part 7 - ADVICE OF INTERNATIONAL SIGHT DRAFT › Section 55-3-701 - Repealed.

ANNOTATIONS
Repeals.
— Laws 1992, ch. 114, § 237A repeals 55-3-701 NMSA 1978, as enacted by Laws 1961, ch. 96, § 3-701, relating to letter of advice of international sight draft, effective July 1, 1992. For provisions of former section,
see
the 1991 NMSA on
NMOneSource.com
.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 3 - Negotiable Instruments › Part 8 - MISCELLANEOUS › Section 55-3-801 to 55-3-805 - Repealed.

ANNOTATIONS
Repeals.
— Laws 1992, ch. 114, § 237A repeals 55-3-801 to 55-3-805 NMSA 1978, as enacted by Laws 1961, ch. 96, §§ 3-801 to 3-805, effective July 1, 1992. For former provisions,
see
the 1991 NMSA on
NMOneSource.com
.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4 - Bank Deposits and Collections › Part 1 - GENERAL PROVISIONS AND DEFINITIONS › Section 55-4-106 - Payable through or payable at bank; collecting bank.

(a) If an item states that it is "payable through" a bank identified in the item, (i) the item designates the bank as a collecting bank and does not by itself authorize the bank to pay the item, and (ii) the item may be presented for payment only by or through the bank.
(b) If an item states that it is "payable at" a bank identified in the item, the item is equivalent to a draft drawn on the bank.
History:
1978 Comp., § 55-4-106, enacted by Laws 1992, ch. 114, § 161.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
1. This section replaces former Sections 3-120 and 3-121 [repealed]. Some items are made "payable through" a particular bank. Subsection (a) states that such language makes the bank a collecting bank and not a payor bank. An item identifying a "payable through" bank can be presented for payment to the drawee only by the "payable through" bank. The item cannot be presented to the drawee over the counter for immediate payment or by a collecting bank other than the "payable through" bank.
2. Subsection (b) retains the alternative approach of the present law. Under Alternative A a note payable at a bank is the equivalent of a draft drawn on the bank and the midnight deadline provisions of Sections 4-301 and 4-302 [55-4-301 and 55-4-302 NMSA 1978, respectively] apply. Under Alternative B a "payable at" bank is in the same position as a "payable through" bank under Subsection (a).
3. Subsection (c) rejects the view of some cases that a bank named below the name of a drawee is itself a drawee. The commercial understanding is that this bank is a collecting bank and is not accountable under Section 4-302 [55-4-302 NMSA 1978] for holding an item beyond its deadline. The liability of the bank is governed by Sections 4-202(a) and 4-103(e) [55-4-202 and 55-4-103 NMSA 1978, respectively].
ANNOTATIONS
Recompilations.
— Laws 1992, ch. 114, § 162 recompiled former 55-4-106 NMSA 1978, relating to separate office of a bank, as 55-4-107 NMSA 1978, effective July 1, 1992.
Effective dates.
— Laws 1992, ch. 114, § 238 made the act effective July 1, 1992.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4 - Bank Deposits and Collections › Part 1 - GENERAL PROVISIONS AND DEFINITIONS › Section 55-4-108 - Time of receipt of items.

(a) For the purpose of allowing time to process items, prove balances and make the necessary entries on its books to determine its position for the day, a bank may fix an afternoon hour of two p.m. or later as a cutoff hour for the handling of money and items and the making of entries on its books.
(b) An item or deposit of money received on any day after a cutoff hour so fixed or after the close of the banking day may be treated as being received at the opening of the next banking day.
History:
1953 Comp., § 50A-4-107, enacted by Laws 1961, ch. 96, § 4-107; 1978 Comp., § 55-4-107, recompiled as 1978 Comp., § 55-4-108 by Laws 1992, ch. 114, § 163.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
1. Each of the huge volume of checks processed each day must go through a series of accounting procedures that consume time. Many banks have found it necessary to establish a cutoff hour to allow time for these procedures to be completed within the time limits imposed by Article 4. Subsection (a) approves a cutoff hour of this type provided it is not earlier than 2 P.M. Subsection (b) provides that if such a cutoff hour is fixed, items received after the cutoff hour may be treated as being received at the opening of the next banking day. If the number of items received either through the mail or over the counter tends to taper off radically as the afternoon hours progress, a 2 P.M. cutoff hour does not involve a large portion of the items received but at the same time permits a bank using such a cutoff hour to leave its doors open later in the afternoon without forcing into the evening the completion of its settling and proving process.
2. The provision in Subsection (b) that items or deposits received after the close of the banking day may be treated as received at the opening of the next banking day is important in cases in which a bank closes at twelve or one o'clock,
e.g.
, on a Saturday, but continues to receive some items by mail or over the counter if, for example, it opens Saturday evening for the limited purpose of receiving deposits and cashing checks.
ANNOTATIONS
Recompilations.
— Laws 1992, ch. 114, § 164 recompiled former 55-4-108 NMSA 1978, relating to delays, as 55-4-109 NMSA 1978, effective July 1, 1992.
The 1992 amendment,
effective July 1, 1992, substituted letters for numbers in the subsection designations; and substituted "An item" for "Any item" in Subsection (b).
Am. Jur. 2d, A.L.R. and C.J.S. references. —
10 Am. Jur. 2d Banks § 699.
Liability of bank in connection with night depositor service, 77 A.L.R.3d 597.
9 C.J.S. Banks and Banking §§ 273, 274, 383.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4 - Bank Deposits and Collections › Part 1 - GENERAL PROVISIONS AND DEFINITIONS › Section 55-4-111 - Statute of limitations.

An action to enforce an obligation, duty or right arising under this article must be commenced within three years after the cause of action accrues.
History:
1978 Comp., § 55-4-111, enacted by Laws 1992, ch. 114, § 166.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
This section conforms to the period of limitations set by Section 3-118(g) [55-3-118 NMSA 1978] for actions for breach of warranty and to enforce other obligations, duties or rights arising under Article 3. Bracketing "cause of action" recognizes that some states use a different term, such as "claim for relief."
ANNOTATIONS
Effective dates.
— Laws 1992, ch. 114, § 238 made the act effective July 1, 1992.
Cross references.
— For limitations of actions for obligations of party to pay note payable at definite time, see 55-3-118 NMSA 1978.
For limitations of actions generally, see 37-1-1 NMSA 1978 et seq.
For limitations of actions for contracts, see 37-1-23 NMSA 1978.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4 - Bank Deposits and Collections › Part 2 - COLLECTION OF ITEMS - DEPOSITARY AND COLLECTING BANKS › Section 55-4-206 - Transfer between banks.

Any agreed method that identifies the transferor bank is sufficient for the item's further transfer to another bank.
History:
1953 Comp., § 50A-4-206, enacted by Laws 1961, ch. 96, § 4-206; 1992, ch. 114, § 172.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
This section is designed to permit the simplest possible form of transfer from one bank to another, once an item gets in the bank collection chain, provided only identity of the transferor bank is preserved. This is important for tracing purposes and if recourse is necessary. However, since the responsibilities of the various banks appear in the Article it becomes unnecessary to have liability or responsibility depend on more formal indorsements. Simplicity in the form of transfer is conducive to speed. If the transfer is between banks, this section takes the place of the more formal requirements of Section 3-201 [55-3-201 NMSA 1978].
ANNOTATIONS
The 1992 amendment,
effective July 1, 1992, substituted "that" for "which".
Am. Jur. 2d, A.L.R. and C.J.S. references. —
10 Am. Jur. 2d Banks §§ 403, 700.
9 C.J.S. Banks and Banking § 408 et seq.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4 - Bank Deposits and Collections › Part 2 - COLLECTION OF ITEMS - DEPOSITARY AND COLLECTING BANKS › Section 55-4-211 - When bank gives value for purposes of holder in due course.

For purposes of determining its status as a holder in due course, a bank has given value to the extent it has a security interest in an item, if the bank otherwise complies with the requirements of Section 55-3-302 NMSA 1978 on what constitutes a holder in due course.
History:
1953 Comp., § 50A-4-209, enacted by Laws 1961, ch. 96, § 4-209; 1978 Comp., § 55-4-209, recompiled as 1978 Comp., § 55-4-211 by Laws 1992, ch. 114, § 177.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
The section completes the thought of the previous section and makes clear that a security interest in an item is "value" for the purpose of determining the holder's status as a holder in due course. The provision is in accord with the prior law (N.I.L. Section 27) and with Article 3 (Section 3-303) [55-3-303 NMSA 1978]. The section does not prescribe a security interest under Section 4-210 [55-4-210 NMSA 1978] as a test of "value" generally because the meaning of "value" under other Articles is adequately defined in Section 1-201 [55-1-201 NMSA 1978].
ANNOTATIONS
Repeals.
— Laws 1992, ch. 114, § 237B repealed former 55-4-211 NMSA 1978, as enacted by Laws 1961, ch. 96, § 4-211, relating to media of remittance, effective July 1, 1992. For provisions of former section,
see
the 1991 NMSA 1978 on
NMOneSource.com
.
The 1992 amendment,
effective July 1, 1992, substituted "Section 55-3-302 NMSA 1978" for "Section 3-302" and made minor stylistic changes throughout the section.
Am. Jur. 2d, A.L.R. and C.J.S. references. —
10 Am. Jur. 2d Banks § 694; 11 Am. Jur. 2d Bills and Notes §§ 337, 339.
Crediting proceeds of negotiable paper to depositor's account, as constituting bank a holder in due course, 59 A.L.R.2d 1173.
9 C.J.S. Banks and Banking § 383 et seq.; 10 C.J.S. Bills and Notes §§ 185, 186.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4 - Bank Deposits and Collections › Part 4 - RELATIONSHIP BETWEEN PAYOR BANK AND ITS CUSTOMER › Section 55-4-404 - Bank not obliged to pay check more than six months old.

A bank is under no obligation to a customer having a checking account to pay a check, other than a certified check, which is presented more than six months after its date, but it may charge its customer's account for a payment made thereafter in good faith.
History:
1953 Comp., § 50A-4-404, enacted by Laws 1961, ch. 96, § 4-404; 1992, ch. 114, § 189.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
This section incorporates a type of statute that had been adopted in 26 jurisdictions before the Code. The time limit is set at six months because banking and commercial practice regards a check outstanding for longer than that period as stale, and a bank will normally not pay such a check without consulting the depositor. It is therefore not required to do so, but is given the option to pay because it may be in a position to know, as in the case of dividend checks, that the drawer wants payment made.
Certified checks are excluded from the section because thay are the primary obligation of the certifying bank (Sections 3-409 and 3-413) [55-3-409 and 55-3-413 NMSA 1978, respectively]. The obligation runs directly to the holder of the check. The customer's account was presumably charged when the check was certified.
ANNOTATIONS
The 1992 amendment,
effective July 1, 1992, substituted "obliged" for "obligated" in the section catchline.
Am. Jur. 2d, A.L.R. and C.J.S. references. —
10 Am. Jur. 2d Banks § 552.
Bank's liability for paying postdated checks, 31 A.L.R.4th 329.
9 C.J.S. Banks and Banking §§ 328 et seq., 337, 341, 351, 357, 358, 405.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4 - Bank Deposits and Collections › Part 5 - COLLECTION OF DOCUMENTARY DRAFTS › Section 55-4-501 - Handling of documentary drafts; duty to send for presentment and to notify customer of dishonor.

A bank that takes a documentary draft for collection shall present or send the draft and accompanying documents for presentment and, upon learning that the draft has not been paid or accepted in due course, shall seasonably notify its customer of the fact even though it may have discounted or bought the draft or extended credit available for withdrawal as of right.
History:
1953 Comp., § 50A-4-501, enacted by Laws 1961, ch. 96, § 4-501; 1992, ch. 114, § 193.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
This section states the duty of a bank handling a documentary draft for a customer. "Documentary draft" is defined in Section 4-104 [55-4-104 NMSA 1978]. The duty stated exists even if the bank has bought the draft. This is because to the customer the draft normally represents an underlying commercial transaction, and if that is not going through as planned the customer should know it promptly. An electronic document of title may be presented through allowing access to the document or delivery of the document. Article 1, Section 1-201 [55-1-201 NMSA 1978] (definition of "delivery").
ANNOTATIONS
The 1992 amendment,
effective July 1, 1992, made minor stylistic changes.
Seasonable return of documentary drafts.
— Payor banks should seasonably return documentary drafts.
Shannon v. Sunwest Bank
, 1994-NMSC-124, 118 N.M. 749, 887 P.2d 285.
Am. Jur. 2d, A.L.R. and C.J.S. references. —
10 Am. Jur. 2d Banks § 713.
Duties of collecting bank with respect to presenting draft for acceptance, 39 A.L.R.2d 1296.
9 C.J.S. Banks and Banking § 414.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4 - Bank Deposits and Collections › Part 5 - COLLECTION OF DOCUMENTARY DRAFTS › Section 55-4-502 - Presentment of "on arrival" drafts.

If a draft or the relevant instructions require presentment "on arrival", "when goods arrive" or the like, the collecting bank need not present until in its judgment a reasonable time for arrival of the goods has expired. Refusal to pay or accept because the goods have not arrived is not dishonor; the bank must notify its transferor of the refusal but need not present the draft again until it is instructed to do so or learns of the arrival of the goods.
History:
1953 Comp., § 50A-4-502, enacted by Laws 1961, ch. 96, § 4-502; 1992, ch. 114, § 194.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
The section is designed to establish a definite rule for "on arrival" drafts. The term includes not only drafts drawn payable "on arrival" but also drafts forwarded with instructions to present "on arrival." The term refers to the arrival of the relevant goods. Unless a bank has actual knowledge of the arrival of the goods, as for example, when it is the "notify" party on the bill of lading, the section only requires the exercise of such judgment in estimating time as a bank may be expected to have. Commonly the buyer-drawee will want the goods and will therefore call for the documents and take up the draft when they do arrive.
ANNOTATIONS
The 1992 amendment,
effective July 1, 1992, made minor stylistic changes.
Am. Jur. 2d, A.L.R. and C.J.S. references. —
10 Am. Jur. 2d Banks § 713.
9 C.J.S. Banks and Banking §§ 414 et seq., 342.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4 - Bank Deposits and Collections › Part 5 - COLLECTION OF DOCUMENTARY DRAFTS › Section 55-4-503 - Responsibility of presenting bank for documents and goods; report of reasons for dishonor; referee in case of need.

Unless otherwise instructed and except as provided in Article 5 a bank presenting a documentary draft:
(1) must deliver the documents to the drawee on acceptance of the draft if it is payable more than three days after presentment; otherwise, only on payment; and
(2) upon dishonor, either in the case of presentment for acceptance or presentment for payment, may seek and follow instructions from any referee in case of need designated in the draft or if the presenting bank does not choose to utilize the referee's services, it must use diligence and good faith to ascertain the reason for dishonor, must notify its transferor of the dishonor and of the results of its effort to ascertain the reasons therefor and must request instructions.
However the presenting bank is under no obligation with respect to goods represented by the documents except to follow any reasonable instructions seasonably received; it has a right to reimbursement for any expense incurred in following instructions and to prepayment of or indemnity for those expenses.
History:
1953 Comp., § 50A-4-503, enacted by Laws 1961, ch. 96, § 4-503; 1992, ch. 114, § 195.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
1. This section states the rules governing, in the absence of instructions, the duty of the presenting bank in case either of honor or of dishonor of a documentary draft. The section should be read in connection with Section 2-514 [55-2-514 NMSA 1978] on when documents are deliverable on acceptance, when on payment. In the case of a dishonor of the draft, the bank, subject to Section 4-504 [55-4-504 NMSA 1978], must return possession or control of the documents to its principal.
2. If the draft is drawn under a letter of credit, Article 5 controls.
See
Sections 5-109 [55-5-109 NMSA 1978] through 5-114 [55-5-114 NMSA 1978].
ANNOTATIONS
The 1992 amendment,
effective July 1, 1992, substituted numbers for letters in the paragraph designations and made minor stylistic changes throughout the section.
Am. Jur. 2d, A.L.R. and C.J.S. references. —
10 Am. Jur. 2d Banks §§ 706, 713.
9 C.J.S. Banks and Banking § 414 et seq.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4 - Bank Deposits and Collections › Part 5 - COLLECTION OF DOCUMENTARY DRAFTS › Section 55-4-504 - Privilege of presenting bank to deal with goods; security interest for expenses.

(a) A presenting bank that, following the dishonor of a documentary draft, has seasonably requested instructions but does not receive them within a reasonable time may store, sell, or otherwise deal with the goods in any reasonable manner.
(b) For its reasonable expenses incurred by action under Subsection (a) the presenting bank has a lien upon the goods or their proceeds, which may be foreclosed in the same manner as an unpaid seller's lien.
History:
1953 Comp., § 50A-4-504, enacted by Laws 1961, ch. 96, § 4-504; 1992, ch. 114, § 196.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
The section gives the presenting bank, after dishonor, a privilege to deal with the goods in any commercially reasonable manner pending instructions from its transferor and, if still unable to communicate with its principal after a reasonable time, a right to realize its expenditures as if foreclosing on an unpaid seller's lien (Section 2-706). The provision includes situations in which storage of goods or other action becomes commercially necessary pending receipt of any requested instructions, even if the requested instructions are later received.
The "reasonable manner" referred to means one reasonable in the light of business factors and the judgment of a business man.
ANNOTATIONS
The 1992 amendment,
effective July 1, 1992, substituted letters for numbers in the subsection designations and made minor stylistic changes throughout the section.
Am. Jur. 2d, A.L.R. and C.J.S. references. —
10 Am. Jur. 2d Banks § 706.
9 C.J.S. Banks and Banking § 414 et seq.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4A - Funds Transfers › Part 1 - SUBJECT MATTER AND DEFINITIONS › Section 55-4A-101 - Short title.

This article may be cited as the Uniform Commerical [Commercial] Code - Funds Transfers.
History:
1978 Comp., § 55-4A-101, enacted by Laws 1992, ch. 114, § 197.
ANNOTATIONS
Effective dates.
— Laws 1992, ch. 114, § 238 makes the act effective on July 1, 1992.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4A - Funds Transfers › Part 1 - SUBJECT MATTER AND DEFINITIONS › Section 55-4A-103 - Payment order; definitions.

(a) In this article:
(1) "payment order" means an instruction of a sender to a receiving bank, transmitted orally, electronically, or in writing, to pay, or to cause another bank to pay, a fixed or determinable amount of money to a beneficiary if:
(i) the instruction does not state a condition to payment to the beneficiary other than time of payment,
(ii) the receiving bank is to be reimbursed by debiting an account of, or otherwise receiving payment from the sender, and
(iii) the instruction is transmitted by the sender directly to the receiving bank or to an agent, funds-transfer system, or communication system for transmittal to the receiving bank;
(2) "beneficiary" means the person to be paid by the beneficiary's bank;
(3) "beneficiary's bank" means the bank identified in a payment order in which an account of the beneficiary is to be credited pursuant to the order or which otherwise is to make payment to the beneficiary if the order does not provide for payment to an account;
(4) "receiving bank" means the bank to which the sender's instruction is addressed; and
(5) "sender" means the person giving the instruction to the receiving bank.
(b) If an instruction complying with Subsection (a)(1) is to make more than one payment to a beneficiary, the instruction is a separate payment order with respect to each payment.
(c) A payment order is issued when it is sent to the receiving bank.
History:
1978 Comp., § 55-4A-103, enacted by Laws 1992, ch. 114, § 199.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
1. This section is discussed in the Comment following Section 4A-104 [55-4A-104 NMSA 1978].
2. Pursuant to the Uniform Commercial Code Amendments (2022) and in furtherance of medium neutrality, the reference to "electronically, or in writing" in the pre-2022 text of this section has been changed to refer to "in a record."
ANNOTATIONS
Effective dates.
— Laws 1992, ch. 114, § 238 made the act effective July 1, 1992.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4A - Funds Transfers › Part 1 - SUBJECT MATTER AND DEFINITIONS › Section 55-4A-103 - Payment order; definitions. (Effective January 1, 2024.)

(a) In this article:
(1) "payment order" means an instruction of a sender to a receiving bank, transmitted orally or in a record, to pay, or to cause another bank to pay, a fixed or determinable amount of money to a beneficiary if:
(i) the instruction does not state a condition to payment to the beneficiary other than time of payment,
(ii) the receiving bank is to be reimbursed by debiting an account of, or otherwise receiving payment from, the sender and
(iii) the instruction is transmitted by the sender directly to the receiving bank or to an agent, funds- transfer system or communication system for transmittal to the receiving bank;
(2) "beneficiary" means the person to be paid by the beneficiary's bank;
(3) "beneficiary's bank" means the bank identified in a payment order in which an account of the beneficiary is to be credited pursuant to the order or that otherwise is to make payment to the beneficiary if the order does not provide for payment to an account;
(4) "receiving bank" means the bank to which the sender's instruction is addressed; and
(5) "sender" means the person giving the instruction to the receiving bank.
(b) If an instruction complying with Paragraph (1) of Subsection (a) of this section is to make more than one payment to a beneficiary, the instruction is a separate payment order with respect to each payment.
(c) A payment order is issued when it is sent to the receiving bank.
History:
1978 Comp., § 55-4A-103, enacted by Laws 1992, ch. 114, § 199; 2023, ch. 142, § 25.
ANNOTATIONS
The 2023 amendment,
effective January 1, 2024, revised the definition of "payment order"; in Paragraph (a)(1), after "transmitted orally", deleted "electronically or in writing" and added "or in a record"; and in Subsection (b), after "complying with", deleted "Subsection (a)(1)" and added "Paragraph (1) of Subsection (a) of this section".
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4A - Funds Transfers › Part 1 - SUBJECT MATTER AND DEFINITIONS › Section 55-4A-106 - Time payment order is received.

(a) The time of receipt of a payment order or communication canceling or amending a payment order is determined by the rules applicable to receipt of a notice stated in Section 55-1-202 NMSA 1978. A receiving bank may fix a cut-off time or times on a funds-transfer business day for the receipt and processing of payment orders and communications canceling or amending payment orders. Different cut-off times may apply to payment orders, cancellations or amendments, or to different categories of payment orders, cancellations or amendments. A cut-off time may apply to senders generally or different cut-off times may apply to different senders or categories of payment orders. If a payment order or communication canceling or amending a payment order is received after the close of a funds-transfer business day or after the appropriate cut-off time on a funds-transfer business day, the receiving bank may treat the payment order or communication as received at the opening of the next funds-transfer business day.
(b) If this article refers to an execution date or payment date or states a day on which a receiving bank is required to take action, and the date or day does not fall on a funds-transfer business day, the next day that is a funds-transfer business day is treated as the date or day stated, unless the contrary is stated in this article.
History:
1978 Comp., § 55-4A-106, enacted by Laws 1992, ch. 114, § 202; 2005, ch. 144, § 49; 2015, ch. 54, § 3.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
The time that a payment order is received by a receiving bank usually defines the payment date or the execution date of a payment order. Section 4A-401 [55-4A-401 NMSA 1978] and Section 4A-301 [55-4A-301 NMSA 1978]. The time of receipt of a payment order, or communication cancelling or amending a payment order is defined in Subsection (a) by reference to the rules stated in Section 1-202 [55-1-202 NMSA 1978]. Thus, time of receipt is determined by the same rules that determine when a notice is received. Time of receipt, however, may be altered by a cut-off time.
ANNOTATIONS
The 2015 amendment,
effective July 1, 2015, amended the Uniform Commercial Code, as enacted by New Mexico, to make it uniform; and in Subsection (a), after "amendments", added "or to different categories of payment orders, cancellations or amendments".
The 2005 amendment,
effective January 1, 2006, changed the statutory reference in Subsection (a) from Section 55-1-201(27) NMSA 1978 to Section 55-1-202 NMSA 1978.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4A - Funds Transfers › Part 2 - ISSUE AND ACCEPTANCE OF PAYMENT ORDER › Section 55-4A-201 - Security procedure. (Effective January 1, 2024.)

"Security procedure" means a procedure established by agreement of a customer and a receiving bank for the purpose of (i) verifying that a payment order or communication amending or canceling a payment order is that of the customer or (ii) detecting error in the transmission or the content of the payment order or communication. A security procedure may impose an obligation on the receiving bank or the customer and may require the use of algorithms or other codes, identifying words, numbers, symbols, sounds, biometrics, encryption, callback procedures or similar security devices. Comparison of a signature on a payment order or communication with an authorized specimen signature of the customer or requiring a payment order to be sent from a known email address, internet protocol address or telephone number is not by itself a security procedure.
History:
1978 Comp., § 55-4A-201, enacted by Laws 1992, ch. 114, § 205; 2023, ch. 142, § 26.
ANNOTATIONS
The 2023 amendment,
effective January 1, 2024, provided that a security procedure may impose an obligation on the receiving bank or the customer, added certain security devices to an existing list of security devices, and provided that requiring a payment order to be sent from a known email address, internet protocol address or telephone number, by itself, is not a security procedure; and, after "A security procedure", added "may impose an obligation on the receiving bank or the customer and", after "numbers", added "symbols, sounds, biometrics", and after "signature of the customer", added "or requiring a payment order to be sent from a known email address, internet protocol address or telephone number".
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4A - Funds Transfers › Part 2 - ISSUE AND ACCEPTANCE OF PAYMENT ORDER › Section 55-4A-203 - Unenforceability of certain verified payment orders. (Effective January 1, 2024.)

(a) If an accepted payment order is not, under Subsection (a) of Section 55-4A-202 NMSA 1978, an authorized order of a customer identified as sender, but is effective as an order of the customer pursuant to Subsection (b) of Section 55-4A-202 NMSA 1978, the following rules apply:
(1) By express agreement evidenced by a record, the receiving bank may limit the extent to which it is entitled to enforce or retain payment of the payment order.
(2) The receiving bank is not entitled to enforce or retain payment of the payment order if the customer proves that the order was not caused, directly or indirectly, by a person (i) entrusted at any time with duties to act for the customer with respect to payment orders or the security procedure or (ii) who obtained access to transmitting facilities of the customer or who obtained, from a source controlled by the customer and without authority of the receiving bank, information facilitating breach of the security procedure, regardless of how the information was obtained or whether the customer was at fault. Information includes any access device, computer software or the like.
(b) This section applies to amendments of payment orders to the same extent it applies to payment orders.
History:
1978 Comp., § 55-4A-203, enacted by Laws 1992, ch. 114, § 207; 2023, ch. 142, § 28.
ANNOTATIONS
The 2023 amendment,
effective January 1, 2024, revised language related to applicable rules for certain payment orders; in Subsection (a), in the introductory clause, after "under", deleted "Section 55-4A-202(a)" and added "Subsection (a) of Section 55-4A-202", and after "customer pursuant to", deleted "Section 55-4A-202(b)" and added "Section (b) of Section 55-4A-202"; and in Paragraph (a)(1), after "By express", deleted "written", and after "agreement", added "evidenced by a record".
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4A - Funds Transfers › Part 2 - ISSUE AND ACCEPTANCE OF PAYMENT ORDER › Section 55-4A-210 - Rejection of payment order. (Effective January 1, 2024.)

(a) A payment order is rejected by the receiving bank by a notice of rejection transmitted to the sender orally or in a record. A notice of rejection need not use any particular words and is sufficient if it indicates that the receiving bank is rejecting the order or will not execute or pay the order. Rejection is effective when the notice is given if transmission is by a means that is reasonable in the circumstances. If notice of rejection is given by a means that is not reasonable, rejection is effective when the notice is received. If an agreement of the sender and receiving bank establishes the means to be used to reject a payment order, (i) any means complying with the agreement is reasonable, and (ii) any means not complying is not reasonable unless no significant delay in receipt of the notice resulted from the use of the noncomplying means.
(b) This subsection applies if a receiving bank other than the beneficiary's bank fails to execute a payment order despite the existence on the execution date of a withdrawable credit balance in an authorized account of the sender sufficient to cover the order. If the sender does not receive notice of rejection of the order on the execution date and the authorized account of the sender does not bear interest, the bank is obliged to pay interest to the sender on the amount of the order for the number of days elapsing after the execution date to the earlier of the day the order is canceled pursuant to Subsection (d) of Section 55-4A-211 NMSA 1978 or the day the sender receives notice or learns that the order was not executed, counting the final day of the period as an elapsed day. If the withdrawable credit balance during that period falls below the amount of the order, the amount of interest is reduced accordingly.
(c) If a receiving bank suspends payments, all unaccepted payment orders issued to it are deemed rejected at the time the bank suspends payments.
(d) Acceptance of a payment order precludes a later rejection of the order. Rejection of a payment order precludes a later acceptance of the order.
History:
1978 Comp., § 55-4A-210, enacted by Laws 1992, ch. 114, § 214; 2023, ch. 142, § 31.
ANNOTATIONS
The 2023 amendment,
effective January 1, 2024, in Subsection (a), after "orally", deleted "electronically", after "or in", deleted "writing" and added "a record"; and in Subsection (b), after "pursuant to", deleted "Section 55-4A-211(d)" and added "Subsection (d) of Section 55-4A-211".
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4A - Funds Transfers › Part 2 - ISSUE AND ACCEPTANCE OF PAYMENT ORDER › Section 55-4A-212 - Liability and duty of receiving bank regarding unaccepted payment order.

If a receiving bank fails to accept a payment order that it is obliged by express agreement to accept, the bank is liable for breach of the agreement to the extent provided in the agreement or in this article, but does not otherwise have any duty to accept a payment order or, before acceptance, to take any action, or refrain from taking action, with respect to the order except as provided in this article or by express agreement. Liability based on acceptance arises only when acceptance occurs as stated in Section 55-4A-209 NMSA 1978, and liability is limited to that provided in this article. A receiving bank is not the agent of the sender or beneficiary of the payment order it accepts, or of any other party to the funds transfer, and the bank owes no duty to any party to the funds transfer except as provided in this article or by express agreement.
History:
1978 Comp., § 55-4A-212, enacted by Laws 1992, ch. 114, § 216.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
With limited exceptions stated in this Article, the duties and obligations of receiving banks that carry out a funds transfer arise only as a result of acceptance of payment orders or of agreements made by receiving banks. Exceptions are stated in Section 4A-209(b)(3) and Section 4A-210(b) [55-4A-209 and 55-4A-210 NMSA 1978, respectively]. A receiving bank is not like a collecting bank under Article 4. No receiving bank, whether it be an originator's bank, an intermediary bank or a beneficiary's bank, is an agent for any other party in the funds transfer.
ANNOTATIONS
Effective dates.
— Laws 1992, ch. 114, § 238 made the act effective July 1, 1992.
2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 4A - Funds Transfers › Part 3 - EXECUTION OF SENDER'S PAYMENT ORDER › Section 55-4A-304 - Duty of sender to report erroneously executed payment order.

If the sender of a payment order that is erroneously executed as stated in Section 55-4A-303 NMSA 1978 receives notification from the receiving bank that the order was executed or that the sender's account was debited with respect to the order, the sender has a duty to exercise ordinary care to determine, on the basis of information available to the sender, that the order was erroneously executed and to notify the bank of the relevant facts within a reasonable time not exceeding ninety days after the notification from the bank was received by the sender. If the sender fails to perform that duty, the bank is not obliged to pay interest on any amount refundable to the sender under Section 55-4A-402(d) NMSA 1978 for the period before the bank learns of the execution error. The bank is not entitled to any recovery from the sender on account of a failure by the sender to perform the duty stated in this section.
History:
1978 Comp., § 55-4A-304, enacted by Laws 1992, ch. 114, § 220.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
This section is identical in effect to Section 4A-204 [55-4A-204 NMSA 1978] which applies to unauthorized orders issued in the name of a customer of the receiving bank. The rationale is stated in Comment 2 to Section 4A-204 [55-4A-204 NMSA 1978].
ANNOTATIONS
Effective dates.
— Laws 1992, ch. 114, § 238 made the act effective July 1, 1992.