dissenting.
The plain language of the statute in question here preconditions a collecting bank’s *296right to charge back upon its giving notice of dishonor to its customer before midnight of the next banking day: “the bank may .. . charge back the amount of any credit given for the item to its customer’s account ... //by its midnight deadline or within a longer reasonable time after it learns the facts it returns the item or sends notification of the facts.” Ill.Rev.Stat. ch. 26, § 4-212 (emphasis supplied). The Official Comment to the Uniform Commercial Code emphasizes the importance of the automatic, domino-like settlements which are made possible between collecting banks by the operation of this simple rule, as “the provisional settlements become final simply with the lapse of time.” Uniform Commercial Code § 4r-212, comment 1. The commentary reiterates that this “right of charge-back or refund must be exercised promptly after the bank learns the facts.” Id., comment 3.1
Numerous courts which have been called upon to interpret section 4-212(1) have concluded that a bank which fails to send notice of dishonor before its midnight deadline loses the right to charge back against the customer’s account; among these cases is one from the Illinois appellate court which should be especially influential upon a federal court sitting in a diversity case. Wells Fargo Bank v. Hartford National Bank & Trust Co., 484 F.Supp. 817, 822 (D.Conn. 1980); Dozier v. First Alabama Bank of Montgomery, 363 So.2d 781, 783 (Ala.Civ. App.1978); Salem National Bank v. Chapman, 64 Ill.App.3d 625, 21 Ill.Dec. 414, 381 N.E.2d 741, 743 (5th Dist.1978); Fromer Distributors v. Bankers Trust Co., 36 A.D.2d 840, 321 N.Y.S.2d 428, 430 (1971); Manufacturers Hanover Trust Co. v. Ak-pan, 91 Misc.2d 622, 398 N.Y.S.2d 477, 479 (N.Y.Civ.Ct.1977); First Security Bank of Utah v. Lundahl, Inc., 22 Utah 2d 433, 454 P.2d 886, 888 (1969); see also 6 J. Reitman, H. Weisblatt, W. Schlichting, T. Rice & J. Cooper, Banking Law § 138.06[2] (1981 and Supp.1982) and cases cited therein. Quite clearly, the intent of the Code’s drafters, reflected in its plain language, was to precondition the right of charge-back under section 4-212 upon timely notice of dishon- or.
The majority argues that this conclusion gives rise to a species of strict liability under section 4-212 which is inconsistent with section 4-103(5). This focus upon a supposed contradiction between strict liability and liability based upon negligence is, in my opinion, wide of the mark. Our task here is to construe together three provisions of Article 4. One is a provision granting banks a right of charge-back under certain conditions, Ill.Rev.Stat. ch. 26, § 4-212(1). One is a provision imposing a duty of ordinary care upon banks, which includes a duty to send notice of dishonor before midnight of the next banking day, Ill.Rev.Stat. ch. 26, § 4—202.2 One is a general provision about the measure of damages under Article 4, Ill.Rev.Stat. ch. 26, § 4—103(5). None of the three provisions directly answers the two-pronged question at issue here: 1) Is a bank liable for the face value of a check if it fails to send notice of dishonor before the midnight deadline? and 2) If the bank is liable for this failure, what is the measure of damages?
Attempting to read these three provisions together so as to do the least violence to the language of each, however, I would conclude that section 4-212 raises a presump*297tion of liability3 when a bank fails to meet its duty to notify the customer in the time prescribed. However, this presumption is still subject to the damage provision of section 103(5):
The measure of damages for failure to exercise ordinary care in handling an item is the amount of the item reduced by an amount which could not have been realized by the use of ordinary care....
Ill.Rev.Stat. ch. 26, § 4-103(5). This section incorporates a rule of causation, that is, a bank will not be held responsible for losses which its conduct did not cause. The section also suggests a procedure, involving the use of a presumption, for excluding damages not caused by failure to notify. In the case at hand, this reading of the statutory provisions requires that we presume Prospect National’s default has injured Appliance Buyers and that the amount of that injury was equivalent to the face value of the check. However, this presumption could be rebutted by evidence that the item in question would have been uncollectible even if timely notice had been given. The language of section 4-103(5), moreover, by prescribing the face amount of an item as a baseline to be “reduced,” seems to support placement of the burden of persuasion on this issue upon the bank.4
I realize that to shift the burden of persuasion to the bank will require banks to rely on information which may be more immediately accessible to their customers, but this is a hurdle which may be surmounted by discovery. I believe it is more significant that failure to shift the burden would leave the onus entirely upon the depositor even though it is the bank’s breach of duty which may have brought about the alleged harm. Judge Morgan seems to have left the burden of persuasion on the depositor rather than on the bank. I would therefore remand this case for further findings, based on a shift of the burden of persuasion as I have indicated, and for a determination of what damages, if any, the plaintiff suffered due to receipt of the notice of dishonor on October 29 rather than on the date statutorily prescribed; in order to limit its responsibility for the loss suffered, the bank would be required to show by a preponderance of the evidence that earlier notice of dishonor would not have permitted the plaintiff to mitigate its damages.
I therefore respectfully dissent.
. The Illinois Code Comment indicates that a bank’s sole remedy prior to section 4-212 was to hold the depositor liable upon his contract of indorsement. Ill.Rev.Stat. ch. 26, § 4-212, comment 1.
. Section 4-202 provides in relevant part that:
(1) A collecting bank must use ordinary care in
(b) sending notice of dishonor or nonpayment or returning an item
(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.
Ill.Rev.Stat. ch. 26, § 4-202.
. Whether the liability is one based on negligence or is liability without fault (“strict liability”) is not really relevant here.
. One court has described this provision as “a shield in the hands of a negligent defendant,” rather than “a sword in the hands of a plaintiff.” Wells Fargo Bank v. Hartford National Bank & Trust Co., 484 F.Supp. at 822 (concluding that section 4-103(5) was thus irrelevant to an action based on section 4-212).