Back in December 2013, I paid the insurance for a "friend's" business on my credit card so that it wouldn't get canceled. The amount was $1,700+ but before I did, I requested a post-dated check for repayment. I received 3 separate checks for $575 each dated 2/1/13, 3/1/13 and 4/1/13. The first problem is that they were all immediately stale checks because the year should have been 2014 but I'm sure it was an honest mistake. Anyway, when those dates had passed, I inquired about cashing them as I didn't want them to bounce and incur more expenses for bounced checks (unfortunately, they are drawn on a bank that does not have any offices near me). I kept getting promises of dates that I would be able to cash ONE OF THEM but that still hasn't panned out. I'm thinking now I should just deposit all 3 and let them bounce if they're going to just so I have something to start legal action with. However, I'm not sure what to do about the stale date. Can you offer any advice for this Central NY loan-not-getting-repaid fool?
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3It's important to note here that a bank may still negotiate a stale-dated personal check, because they do not often carry explicit "VOID AFTER ____ DAYS" notices. They are not required to honor it, but they may.– NoahCommented Jun 17, 2014 at 21:25
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1Please remember to put location tag if you want to get a relevant answer. Rules vary between countries.– littleadvCommented Jun 18, 2014 at 6:26
3 Answers
Check is an obligation to pay, and is unconditional. In the US, checks don't expire (there are countries where they do). Endorsements such as "void after X days" are meaningless and don't affect the obligation to pay.
The bank is under no obligation to honor a check that is more than 6 months old (based on the date on the check, of course). This is from the Unified Commercial Code 4-404. However, this refers to the bank, not to the person who gave you the check. The bank may pay, if the check is deposited in good faith and there's nothing wrong with it or with the account.
So the first thing you can do is deposit the check. If asked - you can say that the person just wrote the wrong date, which is true. Worst case the check bounces. If the check bounces - you can start with demand letters and small claim courts. The obligation to pay doesn't go away unless satisfied, i.e.: paid.
You should write a demand letter immediately, send the letter by certified mail, and then wait 30 days. Here is a sample demand letter for the state of california that you can send: http://www.courts.ca.gov/11151.htm
It seems like most of the demand letters assumed that you tried to cash the check and incurred a service fee. Personally, I wouldn't risk incurring even most cost. Instead, after 30 days, I would take him to small claims court and show all the evidence you have (checks, receipts, and letters of correspondence).
Find smaller payments he can make. Maybe a % of each client he takes payment from. Consult with a lawyer or google buisness contract elements and find fill them out and see what he can do. If the checks are no good bouncing them isn't going to help anything. Nor is getting a judgment from a small claims court. He can still not pay(though stays on his credit for 25 years), file for bankruptcy, etc.
