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#46950 - 12/04/02 09:57 PM Stop Payments
CFreasier Offline
Junior Member
Joined: Mar 2001
Posts: 25
Corpus Christi, TX, USA
We have a customer who put a stop payment on a check. When the check was returned to the merchant, stamped accordingly, the merchant submitted the check to the County District Attorney - Hot Check Division for collection. The customer was told that they could put a warrant out for her arrest. The customer says that she put the stop payment on the check due to not receiving satisfactory service. Does anyone know what the guidelines are in this situation? Thanks in advance for your help.

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General Discussion
#46951 - 12/04/02 10:21 PM Re: Stop Payments
Andy_Z Offline
10K Club
Joined: Oct 2000
Posts: 27,748
On the Net
Let the customer duke it out with the DA. You have to follow stop payment requests.

If the merchant believes it is theft by check, you should not be involved. If the DA wants to handle a dispute over goods and services, let them.

Tell the customer it is a legal issue if they ask. And that they should visit the DA and/or get counsel.
My opinions are not necessarily my employers.
Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell

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#46952 - 12/05/02 02:08 PM Re: Stop Payments
LoisLane Offline
Diamond Poster
Joined: Oct 2001
Posts: 1,570
Wisteria Lane..
I'm guessing that the DA can get involved because of the the UCC's "Holder in Due Course" rule.
And where is Superman when I need him?

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#46953 - 12/05/02 02:15 PM Re: Stop Payments
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
The fact of a stop payment does not erase the obligation for which the check was tendered. At a minimum, the drawer of the check must return the merchandise (if applicable). If it's a service that was received, the drawer of the check and the provider of the service have to settle the transaction. The merchant is entitled to payment.

The bank, if it dishonored the check in conformance to the drawer's instructions, is out of the picture here, and should keep out of it to avoid any liability.
John S. Burnett
Fighting for Compliance since 1976
Bankers' Threads User #8

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