diff --git a/chainqueue/db/models/otx.py b/chainqueue/db/models/otx.py
index deeea0c..63cb102 100644
--- a/chainqueue/db/models/otx.py
+++ b/chainqueue/db/models/otx.py
@@ -189,10 +189,8 @@ class Otx(SessionBase):
             SessionBase.release_session(session)
             raise TxStateChangeError('REJECTED on tx that has not been RESERVED ({})'.format(status))
 
-
-
         self.__set_status(StatusBits.NODE_ERROR | StatusBits.FINAL, session)
-            
+        self.__reset_status(StatusBits.QUEUED | StatusBits.RESERVED, session)
         if self.tracing:
             self.__state_log(session=session)
 
@@ -221,7 +219,7 @@ class Otx(SessionBase):
         self.__set_status(StatusBits.OBSOLETE, session)
         if manual:
             self.manual(session=session)
-        self.__reset_status(StatusBits.QUEUED | StatusBits.IN_NETWORK, session)
+        self.__reset_status(StatusBits.QUEUED | StatusBits.IN_NETWORK | StatusBits.RESERVED, session)
 
         if self.tracing:
             self.__state_log(session=session)
diff --git a/chainqueue/sql/backend.py b/chainqueue/sql/backend.py
index 16a09a5..bbb2a97 100644
--- a/chainqueue/sql/backend.py
+++ b/chainqueue/sql/backend.py
@@ -6,7 +6,11 @@ import urllib.error
 from sqlalchemy.exc import (
     IntegrityError,
     )
-from chainlib.error import JSONRPCException
+from chainlib.error import (
+        RPCException,
+        RPCNonceException,
+        DefaultErrorParser,
+        )
 from hexathon import (
         add_0x,
         strip_0x,
@@ -26,6 +30,7 @@ from chainqueue.sql.state import (
         set_reserved,
         set_sent,
         set_fubar,
+        set_rejected,
         )
 from chainqueue.sql.tx import cache_tx_dict
 
@@ -34,8 +39,11 @@ logg = logging.getLogger(__name__)
 
 class SQLBackend:
 
-    def __init__(self, conn_spec, *args, **kwargs):
+    def __init__(self, conn_spec, error_parser=None, *args, **kwargs):
         SessionBase.connect(conn_spec, pool_size=kwargs.get('poolsize', 0), debug=kwargs.get('debug', False))
+        if error_parser == None:
+            error_parser = DefaultErrorParser()
+        self.error_parser = error_parser
 
 
     def create(self, chain_spec, nonce, holder_address, tx_hash, signed_tx, obsolete_predecessors=True, session=None):
@@ -71,7 +79,7 @@ class SQLBackend:
         fail = False
         r = 1
         try:
-            rpc.do(payload)
+            rpc.do(payload, error_parser=self.error_parser)
             r = 0
         except ConnectionError as e:
             logg.error('dispatch {} connection error {}'.format(tx_hash, e))
@@ -79,7 +87,11 @@ class SQLBackend:
         except urllib.error.URLError as e:
             logg.error('dispatch {} urllib error {}'.format(tx_hash, e))
             fail = True
-        except JSONRPCException as e:
+        except RPCNonceException as e:
+            logg.error('nonce error {} default {}'.format(tx_hash, e))
+            set_rejected(chain_spec, tx_hash, session=session)
+            return 1
+        except RPCException as e:
             logg.exception('error! {}'.format(e))
             set_fubar(chain_spec, tx_hash, session=session)
             raise e
diff --git a/requirements.txt b/requirements.txt
index 2ffa881..93e2d9c 100644
--- a/requirements.txt
+++ b/requirements.txt
@@ -5,4 +5,4 @@ alembic==1.4.2
 SQLAlchemy==1.3.20
 confini>=0.4.1a1,<0.5.0
 pyxdg~=0.27
-chainlib~=0.0.9a2
+chainlib~=0.0.9a3
diff --git a/setup.cfg b/setup.cfg
index e48b94b..c912ff2 100644
--- a/setup.cfg
+++ b/setup.cfg
@@ -1,6 +1,6 @@
 [metadata]
 name = chainqueue
-version = 0.0.4a4
+version = 0.0.4a5
 description = Generic blockchain transaction queue control
 author = Louis Holbrook
 author_email = dev@holbrook.no