Understanding Bad Checks: Laws, Procedures, and Liabilities

Bad Check Issues

Bad check implications:

• Embezzlement - CP 171, § 2, VI - is a felony.
• If there are no funds - non-payment of a check for insufficient funds, when in fact there are funds, by itself generates moral damages to be compensated - the docket entry 388 of the STJ.
• The case of joint accounts - accounts for the bounced check only one who issued the check.
• Art. 47, § 3 LC-out of funds after the deadline (30 or 60 days), have been given during the presentation available funds, and the server no longer have them (funds) for reasons beyond their control - eg. : liquidation of the bank; theft.

Protest for Non-Payment

• Necessary to allow the protest to the execution of endorsers and their guarantors; Now you can charge without protest, by a declaration from the bank.
• Can run endorsers and their guarantors without protest, simply bank statement of lack of funds.
• No need to protest the execution of the server and its guarantors, can be directly executed.
• Bank statement is not enough, however, to instruct the debtor's bankruptcy filing. The bank records in CT the lack of provision of funds. Thus it can be run without protest. Now depends on the bankruptcy petition of protest, so the bank statement has no effect.

Check Handling Procedures

Cashier: check that, on application (server or bearer), the drawee (bank) on the back of the title declares that no provision of funds in the account of the drawer. (Art. 7)

• Drawee (bank) to charge the amount on account of the drawer and reserve it until the deadline for submission.
• Since the drawee (bank) does not relieve the responsibility of the receiver and other obligors.
• If it fails to make a reservation, the drawee (bank) shall be jointly liable for non-payment.
• Do not accept a partial view.

Cashier (or bank): is the bank issues a check that he paid for - the drawer and drawee are the same financial institution.

• Not allowed in bearer form.
• Assumes the nature of a promise of payment.
• Traveler's check as a kind of cashier.

Crossed Checks

CROSSED CHEQUE (art. 44): check that included two parallel lines on its obverse (front) through the check.

• Can only be paid through a bank (to be deposited into account).
• General (blank) or special (black).
• Check to be taken into account (art. 46): clause "to be credited to account" inscribed across.
• Can not be paid, should.

Pre and Post-Dated Checks

CHECK PRE and POST-DATED:

• Conceptual and practical differences, Doctrine and believes it is not pre post terminology. There is no legal provision for this practice.
• The post-dated check and the bank, the check after the deadline for submission runs from the date of post dating, not the issue (Jurisprudence majority).
• The post-dated check and the payee.
• Entry 370 of the Supreme Court docket; is characterized moral damage to early submission of post-dated check.
• Principle of literalism - in case of post-date the check is recommended to write their own check in the date in question, so that if necessary, to make the proof of the agreement post-dating.

Worth the obligations that are recorded in the TC. It should be written on the check "Good day for p-so."