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Two Payees on Postal Money Order
Answer by John Burnett, BOL Guru
Guru Bios
Question: We took a U.S.P.S Money Order two months ago for deposit. It listed two payees, but they were connected by "OR," so we let our customer deposit it with just his endorsement. A copy of the money order just came back, marked to say that both endorsements are required. Do we have to charge this back to our customer at this late date, and what's up with the endorsements?
Answer: Like the U.S. Treasury, the U.S. Postal Service has its own regulations, and does not have to comply with the UCC when it comes to returning its money orders. They have no "midnight deadline" to worry about, so don't even think about sending it back for "late return." However, I believe you may have a legitimate gripe here, because, if the facts are as you've stated them, the Postal Service may have erred in applying its own rules.
In its Domestic Mail Manual, section 14.3.5, the USPS states:
A money order completed by the purchaser to show more than one firm or
person as payee is paid to either payee if the conjunction "or" is used to
connect the payees. If no conjunction is used, or if the conjunction "and"
is used to connect the payees, then all the listed payees must endorse the
money order.
I suggest you take the matter up with the local postal authorities. If the money order was issued without the "or" between the payee names, the Postal Service should prevail, and you continue to have a problem. But if the money order was issued with the "or" included, you may have a strong case for reimbursement.
First published on BankersOnline.com 6/26/06. Revised 7/18/06.
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