(810 ILCS 5/4A-211)
(from Ch. 26, par. 4A-211)
Cancellation and amendment of payment order.
(a) A communication of the sender of a payment order cancelling or
amending the order may be transmitted to the receiving bank orally,
electronically, or in writing. If a security procedure is in effect between
the sender and the receiving bank, the communication is not effective to
cancel or amend the order unless the communication is verified pursuant to
the security procedure or the bank agrees to the cancellation or amendment.
(b) Subject to subsection (a), a communication by the sender cancelling
or amending a payment order is effective to cancel or amend the order if
notice of the communication is received at a time and in a manner affording
the receiving bank a reasonable opportunity to act on the communication
before the bank accepts the payment order.
(c) After a payment order has been accepted, cancellation or amendment
of the order is not effective unless the receiving bank agrees or a
funds transfer system rule allows cancellation or amendment without
agreement of the bank.
(1) With respect to a payment order accepted by a
beneficiary's bank, cancellation or amendment is not effective unless the order was issued in execution of an unauthorized payment order, or because of a mistake by a sender in the funds transfer which resulted in the issuance of a payment order (i) that is a duplicate of a payment order previously issued by the sender, (ii) that orders payment to a beneficiary not entitled to receive payment from the originator, or (iii) that orders payment in an amount greater than the amount the beneficiary was entitled to receive from the originator. If the payment order is canceled or amended, the beneficiary's bank is entitled to recover from the beneficiary any amount paid to the beneficiary to the extent allowed by the law governing mistake and restitution.
(d) An unaccepted payment order is canceled by operation of law at the
close of the fifth funds transfer business day of the receiving bank after
the execution date or payment date of the order.
(e) A canceled payment order cannot be accepted. If an accepted payment
order is canceled, the acceptance is nullified and no person has any right
or obligation based on the acceptance. Amendment of a payment order is
deemed to be cancellation of the original order at the time of amendment
and issue of a new payment order in the amended form at the same time.
(f) Unless otherwise provided in an agreement of the parties or in a
funds transfer system rule, if the receiving bank, after accepting a
payment order, agrees to cancellation or amendment of the order by the
sender or is bound by a funds transfer system rule allowing cancellation or
amendment without the bank's agreement, the sender, whether or not
cancellation or amendment is effective, is liable to the bank for any loss
and expenses, including reasonable attorney's fees, incurred by the bank as
a result of the cancellation or amendment or attempted cancellation or
(g) A payment order is not revoked by the death or legal incapacity of
the sender unless the receiving bank knows of the death or of an
adjudication of incapacity by a court of competent jurisdiction and has
reasonable opportunity to act before acceptance of the order.
(h) A funds transfer system rule is not effective to the extent it
conflicts with subsection (c)(2).
(Source: P.A. 97-813, eff. 7-13-12.)