What legally can I do against someone who gives me a bad check?
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UPDATED: Jul 16, 2021
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Against the person who gave you a bad check: (1) contact the individual, if you can, and ask for a replacement check; (2) sue for the full amount of the check plus any bank charges and any damages to your reputation or business problems you might have had; and (3) file a police report to press charges against the individual for passing a bad check.
Certain things are both crimes and also torts, or “civil” wrongs that you can sue over. Passing a bad check is potentially one of those things, so you can both look to press charges and also sue for monetary compensation.
Recourse to the criminal law system
Every state criminalizes passing a bad check. To deliberately give someone a bad check in exchange for something (to pay for goods or services; to pay off a debt; as part of a contract; etc.) is conceptually, either or both, fraud or theft–passing the bad check is lying to or tricking someone to get something of value from them. Therefore, in addition to the more common crimes that passing a bad check might be (like theft), every state has specifically made the act of passing a bad check a crime. The key, though, is that the check must have passed deliberately or with knowledge that it was bad. It’s a crime if you know the account the check was drawn on was recently closed or doesn’t have money in it, but it’s not criminal if you honestly believed the check would be honored, but just did a lousy job of balancing your checkbook.
Often, the surrounding circumstances will make it clear that the check did not bounce by accident but was deliberately bad. For example, take the case of a lawyer who is paid for a court appearance by a check written on an account his client had closed months earlier and the client refused to later honor the bad check with a good one. There is no innocent explanation for writing a check on a closed account at a bank no longer used. The authorities had no trouble concluding that a bad check had been deliberately written and prosecuted the check’s writer.
If you believe that the bad check may have written or passed deliberately, contact the police about pressing charges.
Recourse to civil lawsuit
Whether the bad check was deliberate or not–i.e., whether it was a crime or not–it’s also something you can sue over. You have recourse to the civil (lawsuit) court system as well.
If someone owed you money for something—
–for services you provided;
–for an item you sold him;
–to rent or lease something from you;
–to pay off some debt he owed, such as if he had borrowed money from you or had banged up your car in a parking lot and promised to pay for the damage; and so forth
he’ll still owe you that money. The bad check clearly does not pay whatever amounts he owed.
Therefore, once you find out that the check has been dishonored, you can sue the person who gave you the back check for the money which he or she owes you.
In addition, when someone does something either negligently (or carelessly–i.e., not keeping track of bank balance) or deliberately which costs you money or causes you any other harm, you can sue for that other “damage” they caused you, too. For example, if the bounced check causes you to incur any bank charges (e.g., NSF fee, overdraft protection fee, etc.), you can sue for those amounts.
If the bad check caused some further loss, you can sue for that loss as well. For example, say that you and a friend were going to start a lawn care business and the check was to help buy or lease equipment you needed. The check bounced. Since you could not get the equipment at a good price, but had to scramble to rent it at a more expensive price, you could sue for the additional costs the bad check imposed. In some cases, you might be able to sue for lost profit (if the bad check caused you to lose a customer or job) or even possibly for reputational damage (i.e., defamation) if it damaged your standing in the community or among clients, customers, employees, or vendors.