UCC AND TEXAS STATE CODE 5 Section 4 In all commercial transactions the payment

Ucc and texas state code 5 section 4 in all

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UCC AND TEXAS STATE CODE 5 Section 4 In all commercial transactions, the payment obligations are vital. According to the Uniform Law Commission (2018), over 20 years the rights and obligations to payments have been under article 3 and article 4 in the UCC. Payments through checks is still the most common, however, electronic technology has brought in new ways of bank credit transfers for the purpose of payments. In 1989, a new Article 4A was proposed which utilized the electronic way of fund transfers. Unlike in Articles 3 and 4, this section does not require signatures and endorsements on a check to determine its liability. The rules on banks liability to customer in Article 4 do not apply for Article 4A. This Article has been adopted in most US states because Bank customers need immediate bank transfers and it needs little time to negotiate a contract. In this article, unless the person paying the funds uses just the same bank, the money transfer is a process involving four parties: the originator, the bank which receives first communication from the originator, then the beneficiary’s bank and lastly is the beneficiary. In case a problem occurs in the process of fund transfers, Article 4A divides the parties action to the funds transfers into three categories; i). fund transfers begin from the originator to the originator’s bank. Section 2 of this article (Issues and Acceptance of Payment Order), consists of rules governing acceptance and rejection of the payment order and also controls the relationship between the receiving bank and the sender (the receiving bank executes the payment order). ii). Part 3 of this article (Execution of Sender’s Payment Order by Receiving Bank), entails passage of from one receiving bank to the other until it reaches the beneficiary’s bank. The main obligation of a receiving bank is to pass on the payment order to the next in the string. This part contains rules defining the relationship between receiving
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UCC AND TEXAS STATE CODE 6 banks. iii). The final stage of fund transfer is the payment to the beneficiary. It is Part 4 of the article (Payment). The most important part here is Section 4A-402 where if the transfer is successful, the sender has to pay the amount to the receiving bank. Friedman et al (2014) argue that the 2012 amendments on this article concerning the execution of the Dodd-Frank Wall Street Reform and Customer Protection Act 2010 has been adopted by the District of Columbia and 38 counties. Article 5 The Uniform Law Commission (2018), describes letter of credit as a means of payment used together with checks, drafts, electronic money transfers and the creditor-debtor relationship is unique, to distinguish it from other methods in UCC. The increase of foreign trade has contributed to the increased use of letters of credit. In this article (both original and revised), the intention of the drafter was to provide a framework that would cater for the evolution of business. This article further defines rules needed to establish a letter of credit,
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  • Winter '15
  • Uniform Commercial Code, National Conference of Commissioners on Uniform State Laws

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