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Minnesota Legislature

Office of the Revisor of Statutes

336.4-401 WHEN BANK MAY CHARGE CUSTOMER'S ACCOUNT.
(a) A bank may charge against the account of a customer an item that is properly payable
from that account even though the charge creates an overdraft. An item is properly payable if it
is authorized by the customer and is in accordance with any agreement between the customer
and bank.
(b) A customer is not liable for the amount of an overdraft if the customer neither signed the
item nor benefited from the proceeds of the item.
(c) 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. The notice is effective for the period stated in section 336.4-403(b) for stop-payment
orders, and must be received at such time and in such manner as to afford the bank a reasonable
opportunity to act on it before the bank takes any action with respect to the check described in
section 336.4-303. If a bank charges against the account of a customer a check before the date
stated in the notice of postdating, the bank is liable for damages for the loss resulting from its act.
The loss may include damages for dishonor of subsequent items under section 336.4-402.
(d) A bank that in good faith makes payment to a holder may charge the indicated account of
its customer according to:
(1) the original terms of the altered item; or
(2) the terms of the completed item, even though the bank knows the item has been
completed unless the bank has notice that the completion was improper.
History: 1965 c 811 s 336.4-401; 1986 c 444; 1992 c 565 s 102