Bad cheque from a class action suit?

[EmAnJ]

In 2012, Danone was ordered by the courts to repay a certain amount of money to members of the public for false advertising. Claims were made through a company called Collectiva, a class action service company. I made a claim in about August of last year and was awarded $30. I received the cheque on December 5, 2013.

The cheque was lost in our paperwork so did not get deposited until about two weeks ago. Today we received it back with ‘Item Dishonoured’ on it. I’ve emailed Collectiva, but wonder if anyone has an answer as to why this might have occurred? I do not recall anything stating the cheque had to be deposited within a certain amount of time, and I seem to recall that cheques are generally valid for one year (not sure why I remember this).

For reference, I’m in Canada. The cheque was issued in Quebec.

[Keeve]

@EmAnJ

I do not recall anything stating the cheque had to be deposited within a certain amount of time, and I seem to recall that cheques are generally valid for one year (not sure why I remember this).

In my experience (USA), when such limitations apply, a notice to that effect appears on the check itself. Take another look at both the front and back.

[EmAnJ]

@Keeve

In my experience (USA), when such limitations apply, a notice to that effect appears on the check itself. Take another look at both the front and back.

Nope, nothing like that appears anywhere on the cheque.

[jtur88]

Banks have varying policies on what they consider to be a stale check. My bank once told me that they won’t honor a check over 6 months old.

[bengangmo]

Policy here is 6 months

[Senegoid]

And that’s only if someone at the bank has some reason to notice. In recent years, the banks I’ve done business with point out explicitly that most checks are handle in such a fully automated way that most of them are never seen nor handled by a human at the bank.

To be more specific, the checks are scanned and the amount is recognized by optical character recognition. The date is irrelevant and ignored, as is the written-out-in-words amount.

[Northern_Piper]

I’m in Canada and I’ve always heard there’s a six month limit. Can’t give a cite for it, just what I remember hearing.

[thelurkinghorror]

@Senegoid

And that’s only if someone at the bank has some reason to notice. In recent years, the banks I’ve done business with point out explicitly that most checks are handle in such a fully automated way that most of them are never seen nor handled by a human at the bank.

To be more specific, the checks are scanned and the amount is recognized by optical character recognition. The date is irrelevant and ignored, as is the written-out-in-words amount.

Pretty much. Not accepting checks that old is a policy, but it’s only enforceable if noted.

Who was it made out to? Just your name? Any spelling oddities, changed names, that stuff? US government checks would get rejected if made out to Mr. and Mrs. Smith but was only signed by one of them. I imagine Canadian banking doesn’t stray too far from that formula.

[Mops]

Could it be that they set up that account# the check was drawn on for that specific payout, in order to better track the outflow, then later closed the account when supposedly everyone who wanted to deposit their check had done so?

[What_the]

@Mops

Could it be that they set up that account# the check was drawn on for that specific payout, in order to better track the outflow, then later closed the account when supposedly everyone who wanted to deposit their check had done so?

That’s what I would have done if I were them… of course I’m the evil corporation type .

Is it also possible that the scads of paperwork you probably received had a time limitation on cashing the check buried in there somewhere?

[Dead_Cat]

@Northern_Piper

I’m in Canada and I’ve always heard there’s a six month limit. Can’t give a cite for it, just what I remember hearing.

Same here except I’m in the UK.

Perhaps the cheque failed the automatic process for whatever reason, and then when a human looked at it they noticed the date and so dishonoured it for that reason? That’s my best guess. Good luck with getting it reissued…

[Rachellelogram]

It stale-dated. You should be able to contact the issuer and ask them to do a stop payment and reissue the check.

[Really_Not_All_That_Bright]

Under UCC Article 4, which has been adopted in every state in some form, a bank does not have to honor a stale (6 months or older) check but can if it wants to.

It appears most Canadian banks have voluntarily (?) adopted the same rule.

Stale Dated Items
22. (a) Subject to subsection (b), each Item dated more than six months prior to presentment for
payment may be returned unpaid for the reason “Stale Dated”.
(b) Subsection (a) does not apply if the Item is a Bank Draft, Money Order, Certified Item, or
Receiver General Warrant.
Note: Confirmation that such Items are still acceptable may be obtained by inquiry via fax or
phone, or by sending the Item on collection.

[jtur88]

@Rachellelogram

It stale-dated. You should be able to contact the issuer and ask them to do a stop payment and reissue the check.

It will cost at least $30 to put a stop payment on the $30 check. Just mail it back to the issuer, and request that it be reissued. This time, don’t lose it.

No bank is ever obliged to honor any check, and when they do, it is just a courtesy to their accountholder.

[Really_Not_All_That_Bright]

@jtur88

No bank is ever obliged to honor any check, and when they do, it is just a courtesy to their accountholder.

Nonsense. It is a contractual obligation to the account holder. The bank is the agent of the drawer and may only disregard the drawer’s directions as provided by law.

[Omar_Little]

@Really_Not_All_That_Bright

Nonsense. It is a contractual obligation to the account holder. The bank is the agent of the drawer and may only disregard the drawer’s directions as provided by law.

You are right the obligation is of the account holder, which doesn’t go away even if the instrument that they used to pay became stale. But banks are allowed to put policies concerning stale instruments as they see fit, on drafts that they are responsible for covering. It’s an internal control.

[Really_Not_All_That_Bright]

ahem Post 13.

[Canadjun]

Back in the late 70s (so the procedures could very well have changed by then), I got a cheque from the federal government that was stale-dated. I wasn’t expecting it (I seem to recall it was the final pay for a temporary job I had, and I didn’t realize that I was owed it). Pretty sure the delay was because the appropriate people lost track of me (moved from Ontario to Alberta to go to U of A).

What was interesting was that rather than re-issue the cheque, when they tracked me down they sent me the original cheque accompanied by an official letter asking my bank to accept it even though it was stale-dated! I guess the bureaucracy of re-issuing a cheque was too much hassle.

[Omar_Little]

@Really_Not_All_That_Bright

ahem Post 13.

:smack:

[jtur88]

@Really_Not_All_That_Bright

Nonsense. It is a contractual obligation to the account holder. The bank is the agent of the drawer and may only disregard the drawer’s directions as provided by law.

A bank can think of a hundred reasons to refuse to honor a check, regardless of any contractual obligation. The contract is written unilaterally by the bank, and always, always, is worded to favor the bank’s discretion.

“As provided by law” means nothing in this case, because stale-dating of checks is not statutory, but bank policy, which can be as fluid as they like…