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Two-Party Check Endorsement
by Mary Beth Guard, BOL Guru

Question: We have had many disputes on the endorsement of two party checks. Does the check have to have "Pay to the Order of so and so", then be signed by the person the check was originally written to, and then have the signature of the person cashing the check? Or is it legal to just have two signatures, where the last one is the person responsible? ( no pay to the order of)

Answer: Ideally, it should say "Pay to the order of". An indorsement which identifies a person to whom it makes the instrument payable is a "special indorsement." When specially indorsed, an instrument becomes payable to the identified person and may be negotiated only by the indorsement of that person.

See your state's version of UCC Section 3-205

First published on 04/14/03

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