Business Sphere

A businesswoman-reader consulted me, by e-mail, asking for my legal advice on her problem about the bounced check issued in her favor by one of her customers.

     She writes: “I have been engaged in a buy-and-sell jewelry business. Two weeks ago, one of my customers, let’s call her Miss “A”, got a gold necklace from me worth P 100,000.00, and as payment, she issued a check in the same amount of P 100,000.00. 

     When I encashed the check in the bank, it bounced. The check was returned to me by the bank teller with the rubber stamp marked on its face “Drawn Against Insufficient Funds.”  What am I to do to enforce payment?  Please advice me. I am stressed and could not sleep because of this.”

     My advice: It is clear that your customer Miss “A” has issued a worthless check. It bounced when you presented it for payment, because she did not have sufficient funds with the bank to cover or pay for the amount of her check.   

     Certainly, it was very unprofessional for Miss “A” to issue a bouncing check. By issuing such a bum check as payment for the jewelry, Miss “A” has violated the Bouncing Checks Law.

     What you must do now, to protect your rights and interest, is to get the services of a lawyer  to prepare and send to Miss “A” in your behalf, a notice of dishonor.  The notice is a requirement under the law, to inform her that the check has not been paid by the drawee bank.  Miss “A” must make good the check by paying you the sum of P 100,000.00 or by making arrangement for its payment, within five days after receiving the notice of dishonor.

     If Miss “A” fails to pay you or make arrangement for its payment within 5 days after she received the notice, then she will be liable for violation of the Bouncing Checks Law. The law punishes a person who issued a worthless check that was dishonored when presented to the bank for payment.

     When found guilty by the court, Miss “A” can be penalized with an imprisonment of not less than 30 days but not more than 1 year, or a fine of not less than but not more than double the amount of the check, which fine shall not exceed P 200,000,.or both imprisonment and fine. Of course, this is in addition to paying you of her P 100,000 liability.

     I would like to advice you that next time, be careful when accepting a check as payment for your jewelry (or for any other items that you sell for that matter). Otherwise, when the check bounced, you will experience sleepless nights and stressed out again.