Cashed Checks and Offset

Does the right of offset cover a situation where the customer cashes a check instead of depositing it into his account and the check is returned account closed?

Our Harland Deposit Agreement states... "for any liability or debt" under the offset section. But isn't a cashed check final according to UCC?

Anybody?

Cashing an on-us check is final payment. Cashing a check drawn on another bank is simply an accommodation, and you can pursue the person who negotiated it to you. That creates an obligation. If your state law permits offset in such a situation, go for it. If not, perhaps you'll need to use other collection methods, such as small claims court.