Bill Text: IA SSB3054 | 2017-2018 | 87th General Assembly | Introduced
Bill Title: A bill for an act relating to stopping payment on a negotiable instrument by using an electronic record in lieu of a writing.
Spectrum: Committee Bill
Status: (N/A - Dead) 2018-01-30 - Subcommittee recommends passage. [SSB3054 Detail]
Download: Iowa-2017-SSB3054-Introduced.html
Senate
Study
Bill
3054
-
Introduced
SENATE
FILE
_____
BY
(PROPOSED
COMMITTEE
ON
COMMERCE
BILL
BY
CHAIRPERSON
CHAPMAN)
A
BILL
FOR
An
Act
relating
to
stopping
payment
on
a
negotiable
instrument
1
by
using
an
electronic
record
in
lieu
of
a
writing.
2
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
3
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5057XC
(2)
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da/rn
S.F.
_____
Section
1.
Section
554.4403,
Code
2018,
is
amended
by
adding
1
the
following
new
subsection:
2
NEW
SUBSECTION
.
2A.
In
addition
to
a
stop-payment
order
3
made
or
renewed
in
writing
as
described
in
subsection
2,
an
4
equivalent
stop-payment
order
may
also
be
made
or
renewed
5
as
part
of
a
record
that
is
stored
in
an
electronic
medium,
6
and
submitted
to
the
bank,
which
may
include
delivery
via
7
electronic
transmission.
8
EXPLANATION
9
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
10
the
explanation’s
substance
by
the
members
of
the
general
assembly.
11
This
bill
amends
a
provision
in
Article
4,
Part
4,
of
the
12
uniform
commercial
code
(“UCC”)
regulating
the
relationship
13
between
banks
and
its
customers.
14
Code
section
554.4403
requires
a
customer
or
other
15
authorized
person
to
give
the
bank
timely
and
adequate
notice
16
of
stop-payment
instructions
(an
“order”)
either
verbally
or
in
17
writing.
The
order
must
be
received
by
the
bank
in
sufficient
18
detail
(describing
the
item
or
account)
and
within
a
reasonable
19
time
sufficient
for
it
to
act
(some
period
between
the
time
the
20
item
left
the
customer’s
possession
and
before
it
is
presented
21
to
the
bank
for
payment
from
the
customer’s
account).
A
verbal
22
stop-payment
order
lapses
14
days
after
it
was
given.
A
23
written
stop-payment
order
lapses
after
six
months
following
24
the
date
it
was
given.
During
the
period
that
a
verbal
or
25
written
stop-payment
order
is
effective,
it
may
be
renewed
for
26
any
number
of
additional
six-month
periods
but
only
if
the
27
order
is
given
in
writing
during
the
effectiveness
of
the
last
28
order
given.
29
The
bill
amends
Code
section
554.4403
by
allowing
a
customer
30
or
other
authorized
person
to
contact
the
customer’s
bank
by
31
using
an
electronic
“record”
and
submitting
that
record
(e.g.,
32
by
electronic
transmission
such
as
email)
to
stop
payment
on
an
33
item
on
an
equivalent
basis
to
a
written
stop-payment
order.
34
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1
