PARRIS N. GLENDENING, Governor                               Ch. 91

[(b)] (2) [ Until the item has been specially] SPECIALLY indorsed by a bank
to a person who is not a bank.

4-202.

[(1)](A) A collecting bank must [use] EXERCISE ordinary care in:

[ (a)] (1) Presenting an item or sending it for presentment; [ and]

[(b)] (2) Sending notice of dishonor or nonpayment or returning an item
other than a documentary draft to the bank's transferor [ or directly to the depositary
bank under subsection (2) of § 4-212] after learning that the item has not been paid or
accepted, as the case may be; [ and]

[(c)] (3) Settling for an item when the bank receives final settlement; and

[(d) Making or providing for any necessary protest; and]

[(e)] (4) Notifying its transferor of any loss or delay in transit within a
reasonable time after discovery thereof.

[(2) A collecting bank taking proper action before its midnight deadline following
receipt of an item, notice or payment acts seasonably; taking proper action within a
reasonably longer time may be seasonable but the bank has the burden of so
establishing.]

(B) A COLLECTING BANK EXERCISES ORDINARY CARE UNDER SUBSECTION
(A) BY TAKING PROPER ACTION BEFORE ITS MIDNIGHT DEADLINE FOLLOWING
RECEIPT OF AN ITEM, NOTICE, OR SETTLEMENT. TAKING PROPER ACTION WITHIN A
REASONABLY LONGER TIME MAY CONSTITUTE THE EXERCISE OF ORDINARY CARE,
BUT THE BANK HAS THE BURDEN OF ESTABLISHING TIMELINESS.

[(3)](C) Subject to subsection [(1) (a)] (A)(1), a bank is not liable for the
insolvency, neglect, misconduct, mistake, or default of another bank or person or for loss
or destruction of an item [in transit or] in the possession of others OR IN TRANSIT.

4-203.

Subject to [the provisions of] Title 3 concerning conversion of instruments ([§
3-419] § 3-420) and [the provisions of both Title 3 and this title concerning] restrictive
indorsements (§ 3-206) only a collecting bank's transferor can give instructions [which]
THAT affect the bank or constitute notice to it, and a collecting bank is not liable to prior
parties for any action taken pursuant to [ such] THE instructions or in accordance with
any agreement with its transferor.

4-204.

[ (1)] (A) A collecting bank [ must] SHALL send items by A reasonably prompt
method, taking into consideration [ any] relevant instructions, the nature of the item, the
number of [such] THOSE items on hand, [and] the cost of collection [involved]
INVOLVED, and the method generally used by it or others to present [such] THOSE
items.

[ (2)] (B) A collecting bank may send:

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