Civil Check Collection Procedures
Dishonored Checks Introduction
The Bellevue Police Department, White Collar Crime Unit investigates approximately 1000
cases each year involving financial crimes. We use a large portion of our available time
to investigate cases involving the unlawful issuance of bank checks. During the year, we
receive may cases we are regrettably unable to work to a successful prosecution for a
number of reasons including an inability to prove the suspect intent to commit a crime,
improperly completed forms, insufficient evidence, inability to identify the suspect, or
witnesses may have moved leaving no way to contact them.
Though a case may not lend itself to criminal justice resolution, there are alternative
resolutions a complainant or victim may chose to pursue. The purpose of this pamphlet is
to provide general information on one such alternative known as the "Civil Notice of
Dishonor".
The Essentials
The Revised Code of Washington (RCW), Title 62A.3-501 through 525, sets forth a
collection procedure for dishonored checks. The law should NOT be used for checks that are
dishonored because of forgery or checks dishonored by reason of any justifiable stop
payment order. This procedure should be used for checks you have received that are
returned by the bank, marked "Non-Sufficient Funds" or Account Closed" that
you wish to pursue yourself through civil means (instead of filing a criminal complaint or
presenting them to a collection agency). You may use this procedure for checks declined
for investigation by your local police department.
Here are a few general tips and guidelines:
- The purpose of this law is to assist the business community with the problem of
dishonored checks. It applies civil law procedures to obtain collection for both merchants
and individuals.
- Some costs are associated with this procedure. There are copy fees, mail expenses, court
filling fees, possible attorney's fees, and loss of personal time associated with
following this procedure. Before pursuing civil redress, you should carefully weigh the
expenses this procedure may cost you against what you may receive.After receiving
notification by a bank that a check is being dishonored, you can begin a Notice of
Dishonor action against the person who issued the check.
- Take time to document all the steps taken in trying to collect on the bad check. Writing
a chronological narrative, referring to dates, times and names of persons contacted, and
what they tell you, will provide you with a useful resource if and when you go to court.
- You must send a Notice of Dishonor letter to the last known address of the person who
issued the check. The letter must be in a form substantially similar to the statutory form
shown in RCW 62A.3-520 in order to comply with state law.
- You must sent the Notice of Dishonor letter by certified mail (we suggest using
registered delivery) with a return receipt requested, or you must complete an affidavit of
service my mail and be able to provide it in any future court hearings.
- Once served in person or by certified mail with a Notice of Dishonor letter, the person
who issued the check has 15 days to make payment to you.
- If payment is not made within 15 days, you are entitled to recover one percent interest
per month (12 percent per annum) from the date of dishonor and reasonable collection
costs, not to exceed $40.00 or the face amount of the check, whichever is the lesser (See
RCW 62A.3-515).
- RCW 62A.3-315 provides: "... in the event of court action on the check, the court,
after such notice and the expiration of the said fifteen days, shall award a reasonable
attorney's fee, and three times the face amount of the check or three hundred dollars,
whichever is less, as part of damages payable to the holder of the check. This section
shall not apply to any instrument which has been dishonored by reason of any justifiable
stop payment order.
- RCW 62A.3-525 provides: "No interest, collection costs, and attorney's fees, except
handling fees, shall be recovered on any dishonored check under RCW 62A.3-515 (Notice of
Dishonor) where the holder of such check or any agent, employee or assign to the holder
had demanded: (1) interest or collection costs in excess of that provided by RCW
62A.3-515; or (2) interest or collection costs prior to the expiration of fifteen days
after mailing of notice of dishonor, as provided by RCW 62A.3-515 and 62A.3-520; or (3)
attorney's fees either without having such fees set by the court, or prior to the
expiration of fifteen days after the mailing of the notice of dishonor as provided by RCW
62A.3-515 and 62A.3-520.
- In order to receive restitution, you will have to file the Notice of Dishonor suit in
small claims court or in superior court in your county. Where you file depends on the
amount owed to you. Please contact your county, municipal, or district court for further
information on filling a case with them.
- Additionally, RCW 62A.3-515 92) (1) permits you to settle before going to court. If you,
as the holder of the check, commence an action in court and the person who issued the
check wishes to make the check "good" prior to the court hearing, you may accept
as satisfaction of the claim, an amount of money equal to the face amount of the check, a
reasonable handling fee, accrued interest, collection costs equal to the face amount of
the check not to exceed $40.00 and the incurred court costs, service costs, and statutory
attorney's fees.
Sample Notice of Dishonor Letter
(Your Company Letterhead)
Notice of Dishonor of Check
A check drawn by you and made payable by you to (Insert Payee's Name) in the amount of
$ ________ has not been accepted for payment by (Insert Name of the Bank Check is Drawn
Upon) which is the drawee bank designated on your check. This check is dated (Insert Issue
Date From Face of Check), and it is numbered, No (Insert Number on Face of Check)
You are CAUTIONED that unless you pay the amount of this check within fifteen (15) days
after the date this letter is postmarked, you may very well have to pay the following
additional amounts:
(1) Costs of collecting the amount of the check, including any attorney's fee which
will be set by the court;
(2) Interest on the amount of the check which shall accrue at the rate of twelve (12)
percent per annum for the date of dishonor; and
(3) Three hundred ($300.00) dollars or three (3) times the face amount of the check,
whichever is less, by award of the court.
You are also CAUTIONED that law enforcement agencies may be provided with a copy of
this notice of dishonor and the check drawn by you for investigation which may result in
criminal charges if you do not pay the amount of this check within fifteen (15) days after
the date this letter is postmarked.
You are advised to make payment to (Insert Your Name or Company Name) at the following
address: (Insert your address or Company Address).
(Your Signature)
(Source RCW 62A.3-520)
Sample Affidavit of Service by Mail
From RCW 62A.3-522L In addition to sending a notice of dishonor to the drawer of the
check under RCW 62A.3-520, the holder of the check shall execute an affidavit or certified
statement certifying service of the notice by mail. The certificate of service by mail
shall be attached to a copy of the notice of dishonor and shall be substantially in the
following form:
Certified Statement of Service by Mail
I, (Insert Check Holder's Name), hereby certify that on the _____ day of _____________,
19 ____, a copy of the attached Notice of Dishonor of Check was served on (Insert Check
Writer's Name) by mailing via the United States Postal Service, postage prepaid, at
(City), Washington.
Dated: _______________________ Signature: _________________________________
The affidavit of certified statement shall be retained with the check, but a copy of
the affidavit shall be filed with the clerk of the court in which an action on the check
is commenced.
(Source RCW 62A.3-522)
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