cost of returned cheques

astjon

Unfortunately the bank returned two cheques I paid to a retailer and I received a letter from the retailer (or agency acting on their behalf) where the cost for these two cheques is £144.50. Is it up to each company how much they charge for returned cheque? There must be some law. Otherwise they could ask you for 1000's of pounds for a cheque of £10.

paradoxia

£144.50 on top of the original value of the cheques or £144.50 in total?

Rafter

It is basic contract law.

The retailer offered you some goods.

You agreed to pay using a cheque which is a 'promise to pay'

The cheques bounced I guess and the retailer is entitled to recover its costs of recovering the money from you but no more.

This is the same law that is currently enabling people to challenge penalty charges from credit card companies and banks.

R.

astjon

The first cheque was for 181.63 which now stand in £176.63 (cost is £95) and the second cheque is for 58.06 and stands in £106.06 (cost is £48)

If there isn't any laws that take on this does it mean that next time a customer that pays me with cheque of £100 that is returned by the bank I can charge him £100 + £500???

How can I challenge these ridiculous charges?

Rafter

Suggest you pay both cheques and add £12 for each one to cover admin charges.

This is the rumoured amount that the OFT will impose next month as a suggested maximum.

Tell them if they want any more you will be making a small claims court claim for unlawful charges levied against you which have no basis in law unless they can clearly demonstrate that the returned cheques have cost them the £143 they are claiming from you.

The fact that the retailer has been charged by their own bank is irrelevant as the retailer should persue the bank for levying unfair charges too.

R.

bengal-stripe

The cheques probably bounced twice: first time returned “Refer to drawer, please represent”, second time: “Refer to drawer”.

You obviously had your reasons, why you wanted to pay by cheque and not use a card. For a start, what about paying the sum you owe, then argue about the fees. In some countries it is a criminal offence to issue duff cheques.

astjon

Thank you for your advise. It is a much appreciated.