Cancelling a cheq to stop payment (intentionally breech contract) is Fraud!

shocky_2

Cancelling a cheque isn't fraud, it is just breach of contract.

miduck

youngsolicitor wrote: »

Cancelling a cheque isn't fraud, it is just breach of contract.

It can be, it depends on what the intent of the buyer was when entering into the contract.

shocky_2

miduck wrote: »

It can be, it depends on what the intent of the buyer was when entering into the contract.

This isn't right. If you enter into a contract intending to cancel the cheque from the very beginning, then handing over the cheque would be both criminal and civil fraud. Whether the cheque is cancelled or not is irrelevant to the legal analysis.

If you hand over a cheque which you don't intend to pay, but later change your mind and pay the money, thats still fraud (although in reality the retailer wouldn't care). If you enter into a contract honestly and later decide to dishonour the cheque, that is not fraud regardless of your reason for cancelling it - only breach of contract.

miduck

youngsolicitor wrote: »

This isn't right. If you enter into a contract intending to cancel the cheque from the very beginning, then handing over the cheque would be both criminal and civil fraud. Whether the cheque is cancelled or not is irrelevant to the legal analysis.

If you hand over a cheque which you don't intend to pay, but later change your mind and pay the money, thats still fraud (although in reality the retailer wouldn't care). If you enter into a contract honestly and later decide to dishonour the cheque, that is not fraud regardless of your reason for cancelling it - only breach of contract.

That is exactly what I said - it depends on the intent of the buyer when entering into the contract.

You're not actually a solicitor are you?

zzzLazyDaisy

It is unlawful to dishonour (bounce) a cheque. The relevant legislation is the Bills of Exchange Act 1982, as amended. The normal rule is that there is no defence to a claim in relation to a dishonoured cheque except in very exceptional circumstances such as fraud and duress (for example, if you hold a gun to my head and make me write a cheque for my life savings, then that would be a defence if I cancelled the cheque, assuming I was believed).

The point is, that once the recipient has the cheque in their hands, they are entitled to treat it as cash. If a builder does some work for you and you pay him cash, when the work turns out to be faulty, you can sue him for breach of contract, but you cannot mug him in the street, or break into his house, and take the cash back. Same for the cheque, you cannot stop the cheque just because you are unhappy with the work. You have other means of redress, but that is not one of them.

If you do stop/bounce a cheque, the recipient can commence proceedings under the Bills of Exchange Act, and ask for summary judgement on the grounds that there is no defence (ie it would not go to a full hearing). It is not a breach of contract action, so you cannot counterclaim on the basis of their breach of contract in failing to carry out the work to a satisfactory standard - you would have to commence your own separate breach of contract claim.

I have pursued many dishonoured cheque claims on behalf of clients and never lost a case - provided you know and understand the law, it is a simple procedure.

EDIT - for the sake of completeness - a claim under the Bills of Exchange Act is a civil claim and would not interest the police unless there were some additional element, such as a deliberate intent to defraud, and probably also an established pattern of such behaviour. For the most part, though, the police will tell you this is a civil matter.

Hern

Lord knows why anyone wastes their time on American television carp like 'Judge Judy' (who isn't a judge anyway.)

Be good though if we had an intelligent, intelligible UK version to show the Yanks how sensible folks do it. . . in which case, I herewith propose zzzLazyDaisy: talks more sense in three paragraphs than Judge Judy manages in three months.

JethroUK

MothballsWallet wrote: »

Isn't Judge Judy American and they've got Federal and State laws to completely muddy the waters, so perhaps in the good old US of A cancelling a cheque isn't assumed to be fraud until the recipient can prove it?

I'm just chucking on my US$0.02, which is now worth less than £0.01.

vikingaero wrote: »

Different laws. In France I believe it is a criminal offence to have a cheque bounce.

But is cancelling a cheque fraud if there has been non-performance by the seller?

Nope - Writing a cheque with intent to cancel is 'fraudulent' in any language/state/country - it's the intent to deceive that defines it - just like printing false money (intent to deceive) is fraud in any language

Bouncing a cheque is equally 'fraudulent' in any country/language if you write it with full knowledge of insufficient funds (with intent to deceive) - as opposed to writing a legitimate cheq and simply forgetting your standing order - in case of bouncing cheque the intent would need to be proven - and often is (no funds to start with) - not in the case of 'cancelling' - the act of cancelling is prove enough of intent - unless they argued they thought it was lost - but they aint smart enough

arcon5 wrote: »

This article is very informative

http://www.lyonsdavidson.co.uk/news/2063/the-pitfalls-of-paying-by-cheque

you might consider instructing your bank to cancel the cheque until these issues are sorted out. Be warned: the law says that, by giving someone a cheque as payment, the drawer of the cheque (i.e. your bank) is undertaking that it will be paid and therefore the person receiving the cheque (i.e. the payee) should be able to treat it as cash. In other words, cheques should always be honoured and the payee can seek recompense if they are not.

Yeap - as I said - writing a cheque is a promise to pay and only right to cancel is if it is lost or stolen - cancelling with intent 'not to pay' is fraud

JethroUK

antrobus wrote: »

To Jethro UK;

(1) Judge Judy is American; SFA to do with UK law

(2) Judge Judy is a TV Show; it's not a real court. Ms Sheindlin is on record for stating that she bases her decisions on "common sense" rather than the law.

To antrobus

Fraud is defined in the dictionary, not just in law - as is "murder"

A fraudulent act is fraudulent in any language in any country

I am not a lawyer - but I KNOW what fraud means - hence I know what is fraud and what aint - its common sense that should tell you

She uses common sense - but not 'rather' than law - you simply wrote what you 'want' to hear

Common Sense is : I once dropped an apple and it fell to the ground - I dont need to drop a canteloupe to KNOW it will do exactly the same

P.S> I dont even know what a canteloupe is - never seen one, never held one - I've simply heard of one - but it wont stop me KNOWing something about it

JethroUK

youngsolicitor wrote: »

Cancelling a cheque isn't fraud, it is just breach of contract.

No it's fraud if its done with intent not to pay (as opposed to lost/stolen) - Young Solicitor?

You have much to learn o' young one

antrobus

JethroUK wrote: »

...
I am not a lawyer - ..

Well, I think we've all worked that one out.

Anyway, the point is that Judge Judy is a TV show. It's an entertainment. It doesn't pretend to be an exposition of US law (which in any case, tends to vary from state to state). Hence crtiticising Sheindlin for not following a particular legal principle that you think applies in any given case is pointless. She can, and does, make it up as she goes along. If you don't like that, don't watch it.