2006 New York Code - Depositary And Collecting Banks

 
  Section 4--213. Final  Payment  of  Item by Payor Bank; When Provisional
                    Debits and Credits Become Final; When Certain  Credits
                    Become Available for Withdrawal.
    (1) An item is finally paid by a payor bank when the bank has done any
  of the following, whichever happens first:
         (a) paid the item in cash; or
         (b) settled  for the item without reserving a right to revoke the
             settlement and  without  having  such  right  under  statute,
             clearing house rule or agreement; or
         (c) completed  the  process  of posting the item to the indicated
             account of the drawer, maker or other person  to  be  charged
             therewith; or
         (d) made  a  provisional  settlement  for  the item and failed to
             revoke the settlement in the time  and  manner  permitted  by
             statute, clearing house rule or agreement.
    Upon  a  final  payment  under subparagraphs (b), (c) or (d) the payor
  bank shall be accountable for the amount of the item.
    (2) If provisional settlement for an item between the  presenting  and
  payor  banks is made through a clearing house or by debits or credits in
  an account between them, then to the extent that provisional  debits  or
  credits  for the item are entered in accounts between the presenting and
  payor banks or between the presenting and  successive  prior  collecting
  banks  seriatim, they become final upon final payment of the item by the
  payor bank.
    (3) If a collecting bank receives a settlement for an item which is or
  becomes final (subsection (3)  of  Section  4--211,  subsection  (2)  of
  Section  4--213)  the bank is accountable to its customer for the amount
  of the item and any provisional credit given for the item in an  account
  with its customer becomes final.
    (4)  Subject  to  any  right  of  the  bank  to apply the credit to an
  obligation of the customer, credit given by a bank for  an  item  in  an
  account with its customer becomes available for withdrawal as of right
         (a) in  any  case  where  the  bank  has  received  a provisional
             settlement for the item,--when such settlement becomes  final
             and  the  bank  has  had  a reasonable time to learn that the
             settlement is final;
         (b) in any case where the bank is both a depositary  bank  and  a
             payor  bank  and the item is finally paid,--at the opening of
             the bank's second banking day following receipt of the item.
    (5) A deposit of money in a bank is final when made  but,  subject  to
  any  right  of  the  bank  to  apply the deposit to an obligation of the
  customer, the deposit becomes available for withdrawal as  of  right  at
  the  opening  of  the  bank's  next banking day following receipt of the
  deposit.