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Alaska Statutes.

Title 45. Trade and Commerce

Chapter 3. Negotiable Instruments

Section 502. Dishonor.

AS 45.03.502. Dishonor.

(a) Dishonor of a note is governed by the following rules:

(1) if the note is payable on demand, the note is dishonored if presentment is duly made to the maker and the note is not paid on the day of presentment;

(2) if the note is not payable on demand and is payable at or through a bank or the terms of the note require presentment, the note is dishonored if presentment is duly made and the note is not paid on the day it becomes payable or the day of presentment, whichever is later; and

(3) if the note is not payable on demand and (2) of this subsection does not apply, the note is dishonored if it is not paid on the day it becomes payable.

(b) Dishonor of an unaccepted draft, other than a documentary draft, is governed by the following rules:

(1) if a check is duly presented for payment to the payor bank other than for immediate payment over the counter, the check is dishonored if the payor bank makes timely return of the check or sends timely notice of dishonor or nonpayment under AS 45.04.301 - 45.04.302, or becomes accountable for the amount of the check under AS 45.04.302 ;

(2) if a draft is payable on demand and (1) of this subsection does not apply, the draft is dishonored if presentment for payment is duly made to the drawee and the draft is not paid on the day of presentment;

(3) if a draft is payable on a date stated in the draft, the draft is dishonored if presentment for

(A) payment is duly made to the drawee and payment is not made on the day the draft becomes payable or the day of presentment, whichever is later; or

(B) acceptance is duly made before the day the draft becomes payable and the draft is not accepted on the day of presentment; and

(4) if a draft is payable on elapse of a period of time after sight or acceptance, the draft is dishonored if presentment for acceptance is duly made and the draft is not accepted on the day of presentment.

(c) Dishonor of an unaccepted documentary draft occurs according to the rules stated in (b)(2) - (4) of this section, except that payment or acceptance may be delayed without dishonor until no later than the close of the third business day of the drawee following the day on which payment or acceptance is required by (b)(2) - (4) of this section.

(d) Dishonor of an accepted draft is governed by the following rules:

(1) if the draft is payable on demand, the draft is dishonored if presentment for payment is duly made to the acceptor and the draft is not paid on the day of presentment; and

(2) if the draft is not payable on demand, the draft is dishonored if presentment for payment is duly made to the acceptor and payment is not made on the day it becomes payable or the day of presentment, whichever is later.

(e) In any case in which presentment is otherwise required for dishonor under this section and presentment is excused under AS 45.03.504, dishonor occurs without presentment if the instrument is not duly accepted or paid.

(f) If a draft is dishonored because timely acceptance of the draft was not made and the person entitled to demand acceptance consents to a late acceptance, from the time of acceptance the draft is treated as never having been dishonored.

Note to HTML Version:

This version of the Alaska Statutes is current through December, 2004. The Alaska Statutes were automatically converted to HTML from a plain text format. Every effort has been made to ensure their accuracy, but this can not be guaranteed. If it is critical that the precise terms of the Alaska Statutes be known, it is recommended that more formal sources be consulted. For statutes adopted after the effective date of these statutes, see, Alaska State Legislature If any errors are found, please e-mail Touch N' Go systems at E-mail. We hope you find this information useful.

Last modified 9/3/2005