Cheque payments

tax_inspector

Hi
Can anyone confirm if it's true that a debt paid via cheque is considered to be settled immediately upon the cheque having been posted to the creditor?

le_loup

I would imagine that the debt is settled upon clearance of the cheque.

jonesMUFCforever

tax_inspector wrote: »

Hi
Can anyone confirm if it's true that a debt paid via cheque is considered to be settled immediately upon the cheque having been posted to the creditor?

Incorrect.
What if the cheque is never received by the beneficiary?

To get round this why not use a modern method of paying such as faster payment?

tax_inspector

I was seeking clarification from a legal point, Guys. I seem to recall reading sometime back that once the cheque had been posted to the creditor the debt was deemed to have been paid. You had to have proof of posting ie copy of the stamped addressed envelope, recorded delivery slip etc and maybe also a copy of the cheque would be useful but unnecessary. I was just wondering if that was still the case.

jonesMUFCforever

tax_inspector wrote: »

I was seeking clarification from a legal point, Guys. I seem to recall reading sometime back that once the cheque had been posted to the creditor the debt was deemed to have been paid. You had to have proof of posting ie copy of the stamped addressed envelope, recorded delivery slip etc and maybe also a copy of the cheque would be useful but unnecessary. I was just wondering if that was still the case.

Have a look here you might find the answer:

http://hansard.millbanksystems.com/lords/1958/mar/18/the-cheques-act-and-receipts

bengal-stripe

tax_inspector wrote: »

......once the cheque had been posted to the creditor the debt was deemed to have been paid.

And if the cheque bounces subsequently, so the creditor has received a worthless piece of paper, is the debt being paid as well? The cheque is an instruction to the bank to pay someone a specified amount. For a variety of reasons (errors, insufficient funds etc) the bank cannot or will not pay.

The debt is paid, once the creditor has received the money in his/her account.

MDMD

You might be thinking of the postal rule for contract acceptance

http://www.lawteacher.net/free-law-essays/communications-law/postal-rule-is-a-historical-ruling.php

the_long_and_winding_road

I agree with MDMD ^^^
Attended a course on this particular point (Contract Management & Law) last Summer and this area was covered.