Okla. Stat. tit. 12A § 4-106

Current through Laws 2024, c. 453.

Section 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, (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.

(c) If a draft names a nonbank drawee and it is unclear whether a bank named in the draft is a co-drawee or a collecting bank, the bank is a collecting bank.

Okla. Stat. tit. 12A, § 4-106

Added by Laws 1991, SB 25, c. 117, § 99, eff. 1/1/1992.

Oklahoma Code Comment

A collecting bank on a "payable through" draft often must try to determine if it is a joint payor or simply a collecting bank. See, e.g., Reynolds-Wilson Lumber Co. v. Peoples National Bank, 699 P.2d 146 (Okla. 1985), where it was unclear whether the bank was a co-drawee or a collecting bank. The problem with "payable through" drafts is they often list the bank and its customer in a manner where both might appear to be drawees. For example, often the draft will come in with the designation "John Smith, XYZ Bank." The determination must be made because if the parties are co-drawees, then presentment to either of them is sufficient, but more likely, XYZ Bank is a "payable through" bank. If the bank is a collecting bank, then it does not face the midnight deadline requirements that would apply if it were a payor bank

The 1992 revisions to this Section have Tightened the burden of banks in determining their status on these types of "payable through" drafts. Thus, in Reynolds-Wilson Lumber Co., the bank would now be a collecting, rather than a payor bank.