Hey gang. Can someone help me with the section of the UCC that covers time frames for return items. We refused a late return of counterfeit items and now the bank is trying to say that we are violating article 3. My brain is toast and I am looking for a quick response.

Thanks

4-302. PAYOR BANK's RESPONSIBILITY FOR LATE RETURN OF ITEM.

(a) If an item is presented to and received by a payor bank, the bank is accountable for the amount of:

(1) a demand item, other than a documentary draft, whether properly payable or not, if the bank, in any case in which it is not also the depositary bank, retains the item beyond midnight of the banking day of receipt without settling for it or, whether or not it is also the depositary bank, does not pay or return the item or send notice of dishonor until after its midnight deadline;