Compliance Blog

Aug 19, 2008
Categories: Accounts

Uniform Commercial Code Research

Ah, the UCC.  This lovely collection contains the answers to those wonderful questions about stale-dated and post-dated checks.

Post-Dated Check
"A bank may charge against the account of a customer a check that is otherwise properly payable from the account, even though payment was made before the date of the check, unless the customer has given notice to the bank of the postdating describing the check with reasonable certainty..."  Article 4, Section 401(c).

Stale-Dated Checks
"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. "  Article 4,  Section 404.

Those are just a few of the UCC provisions relevant to credit unions day-to-day operations.  The National Check Fraud Center has put together a list of "20 UCC Provisions Every Banker Should Know."  This is a great read as it explains some of the complicated UCC provisions in easier to understand language.


Looking for the full-text of the UCC online?  Cornell University Law School has you covered.  Those who have dedicated numerous hours to UCC research will notice the absence of the invaluable Official Comments.  The comments provide further information and explanations unable to be incorporated into the actual text of the UCC.

Note:  The UCC mentioned above is the Model UCC.  Each state has their own version of the UCC and may or may not have adopted a particular provision from the Model UCC in the exact language.  Be sure to check your state's code.  The Cornell website has state-specific information here.