Section 5-328. Processing fee by holder of dishonored check

1. As used in
  this section the following terms shall have the following meanings:
    (a)  "Holder  of  a  check"  means  the  holder   or   its   assignee,
  representative  or  any  other  person  retained  by  the holder to seek
  collection of the face value of a dishonored check.
    (b) "Dishonored check" means a check, draft or like  instrument  drawn
  on  a  bank  or depository institution as full or partial payment for an
  unpaid balance on an account, or  for  other  extensions  of  credit  or
  payments  of  money  in connection with a consumer transaction, which is
  not paid or is dishonored or is returned  by  such  institution  due  to
  insufficient funds or other cause not attributable to the holder.
    (c)  "Consumer  transaction"  means  a  transaction in which a natural
  person  is  extended  credit  for,  or  purchases  or  leases,  personal
  property,  money or services primarily for personal, family or household
  purposes.
    (d) "Account" means a loan account, a  retail  credit  account  or  an
  obligation under a retail lease agreement, retail instalment contract or
  retail instalment obligation or a retail instalment credit agreement, as
  defined in sections three hundred one, three hundred thirty-one and four
  hundred one of the personal property law.
    2. Notwithstanding the provisions of any law:
    (a)  The  holder of a dishonored check given in payment for a consumer
  transaction or an account may  collect  from,  charge,  or  add  to  the
  outstanding  balance  of the account of, the person from whom such check
  was received or to whom such credit was  extended,  a  dishonored  check
  charge  of  not  more  than  the  lesser  of  the amount agreed upon, if
  contracted for, or twenty dollars.
    (b) A dishonored check charge shall not be  deemed  a  credit  service
  charge,  interest  or  an incident to or a condition to the extension of
  credit, for any purpose of law.
    3. Notwithstanding any other provision of law, any person  to  whom  a
  check,  draft  or  like  instrument,  other  than  a  money  order, bank
  cashier's check or certified check, is  tendered  for  any  transaction,
  other than a consumer transaction, may, if such instrument is dishonored
  charge  or collect from the maker or drawer the amount of twenty dollars
  for the return of such unpaid or dishonored instrument.