Scenario: 1. A check/item is received as part of an inclearings cash letter. 2. All items in the cash letter are processed by item processing prior to 10am. 3. As a result, the check/item in question has 'presented' against the customer's account reducing their available balance (not their ledger balance) and the teller's view of the account's activity will show as a check presentment. 5. The account's ledger balance will not be reduced until the close of the business day when all applications are run/closed.

The customer calls the bank at approximately 11am to place a stop payment on the item described above. Since the item has only been memo posted 'presented' against the customer's account record/available balance, can we accept a stop payment request prior to the close of business on this same business day?

Can you - sure. Should you - maybe not. You should check your State's version of UCC 4-303 to determine your obligation under the specific circumstances. What you may not want to do is establish a precedent more lenient than State law.

Check your Commercial Code for something called a "cutoff hour". In CA, we must accept a stop payment until the earlier of the midnight deadline, close of business or the cutoff hour (unless the item was cashed before the stop).

In your example, presentment is "today" and you have until midnight tomorrow to return the item. The cutoff hour can be no earlier than 1 hour after opening, so that is what ours is. Tonight's presentations can be returned for a stop payment until 10:00 tomorrow morning.

That also applies to legal processes received by 10:00. We have presented items returned if necessary for the levy.

Al

Also, review your account agreement to determine whether you have notified the customer of a cut-off time for accepting stop payment orders.

You guys are wonderful.

I checked the ORS 74.3030 "Customer’s right to stop payment; duration of stop payment order; burden of proof of loss."

I feel comfortable that we are ok with returning an item in the scenario I described earlier. It has been our practice to return an item based on the timeline described above, but a situation arose this week that gave me reason for pause. It's always helpful to ask others. Thank you kindly for responding.