The holder or transferor of a negotiable instrument transferred to a licensee for collection has a preferred claim in the amount of the liability of the licensee on the instrument if the instrument was forwarded to the licensee by any person or by any other financial institution for collection and remittance, if payment therefor has not been made and if the same has been collected either in whole or in part by the licensee, unless the holder or transferor is a voluntary depositor in the
licensee and the proceeds of the collection, at his or her request, have been credited by the licensee to his or her account.
Liquidation and ConservationPriorities
Section § 710
This section explains that if you give a negotiable instrument, like a check, to a licensed company to collect money for you, you have a top priority claim to that money. This applies unless you've agreed for the money to be deposited into your account with them. If they've collected the money but haven't paid you yet, your claim is prioritized.
negotiable instrument preferred claim licensee liability
