The procedure and terms for presenting a check for payment

The check belongs to the category of negotiable documents, i.e. for transferring rights on a check to another person, there is no need to resort to the procedure provided for by civil law – the cession. All rights under it can be transferred to another person by means of a transfer inscription – an endorsement affixed to the back of the check or on an additional sheet attached to it.

The endorsement must be signed by the person on whose behalf it is affixed and dated. A check issued by endorsement must be awarded by an endorser – a person to whom the check belonged earlier and who put his endorsement on it, an endorser (toru) – new to the owner of the check.

The endorsement may be blanc, warrant, personal or instructive.

A blank endorsement consists of one inscription of the last legal holder of a check or signature, accompanied by an indication that the check is paid to any of its owners. A person who receives a check on a blank endorsement may transfer it to another person by simple delivery, by means of a blanc endorsement, or affix a warrant or personalized endorsement.

Namely, the endorsement contains the name of the person to whom the check must be paid, for example, “pay to company X”. If the wording “pay the order …” is contained nearby, then such an endorsement is called warrant.

If the endorsement contains a clause “on collection”, “on deposit” or equivalent wording, then such an endorsement is called instructive. Its peculiarity is that, putting down a similar endorsement, the holder of the check, the endorser, aims to transfer the endorser indicated by him not the right to receive money, but only the right to collect the amount of the check in favor of the endorser.

The main functions of the endorsement:

Transferable – i.e. transfer of the right to receive payment on a check from one person to another; Legitimation – confirmation that the new check holder owns it legally; Guarantee – taking responsibility by the endorser to the endorser (rom) for payment by check.

Payment for a check can be guaranteed for the entire amount or part of it by any other person, except for the payer on the check.

The guarantee is usually expressed by the words “guaranteed”, “aval”, “count for an aval” or other equivalent formulations reflecting the essence of the guarantee (aval) and is accompanied by the signature of the person (avalista) who assumed responsibility for the payment. It is also necessary to indicate on the check for whom the guarantee is given, as well as the addresses of the guarantor and the date of affixing the warranty inscription.

The warranty (aval) is noted on the check itself – on its back or on the sheet attached to the check (allonge). Moreover, if the aval is marked on the front side of the check, it is enough for the guarantor to put his signature without adding the above expressions “guarantee”, “count for aval”, etc., i.e. a simple signature on the front side of the check, if this is not the signature of the checker, is recognized as the signature of the avalist. At the same time, the signature on the back of the check is considered as an endorsement.

By its nature, the responsibility of the guarantor is not the main, but the subordinate (accessory).

Unlike other persons responsible for the check:

the guarantor can limit his liability only to part of the amount of the check or indicate that his guarantee is valid only until such a period; the guarantor must not be required to check before, how responsibility came for the check of the person for whom he gave the guarantee; having paid the check, the guarantor acquires the right of a reverse claim against him against the party for which he gave the guarantee, and against those parties, who are responsible to the last. Moreover, he does not have to be the holder of the check, i.e. the check may not be endorsed by him, but simply transferred (handed over) against the payment made by him.

To exercise the rights laid down in the check, the check holder must present it for payment in compliance with certain rules.

The check must be submitted to the payer indicated on the check during the validity period of the check, determined by the relevant check legislation.

Failure to submit a check for payment within these terms deprives the check holder of the right to recourse against previous parties – endorsers and their guarantors, but not against the latch.

According to international standards of check legislation, the following deadlines for submitting a check for payment are provided:

8 days from the date of compilation, if the check is issued and paid in one country; 20 days if the check is issued in one country is paid in another country, but both countries are in the same part of the world on the same continent; 70 days if the country of the place of the check and the country of its place of payment is in different parts of the world.

These dates begin to flow from the day indicated on the check as the day of its exhibition. After the deadline for presenting a check for payment, the latch has the right to withdraw the check, i.e. instruct the payer bank not to pay the check upon presentation.

The presentation of the check to the payer for payment can be made by the check holder directly. However, in practice, the check holder often passes it to his bank “on collection”.

The bank accepts the check for collection, having previously checked the correct design of the transfer labels and affixes a instructive endorsement on the check. The collection order should also contain instructions in case of non-payment of the check, namely: should an unpaid check be submitted to protest or otherwise take legal action in exchange for it in order to certify the fact of non-payment of the check. Such a certificate is necessary so that the owner of the check, who presented it for payment and did not receive it, acquires the right to demand payment from other persons required by the check – endorsers, avalists.

During the exercise of check rights, the checkholder may encounter the fact of refusing to pay the check. In this case, the normal check-in process is disrupted, and the check holder is faced with the need to satisfy his check claims. The confirmation of the fact of non-payment must be given to this process a public character, i.e. make a check protest.

The protest is an official confirmation of the fact that the check is not paid (deferred to non-payment). The protest is made in the place where the check is payable. The protest process of the check is drawn up by an act of protest, which is signed and dated by a person authorized by the law of the place of protest. The protest act usually indicates the person at whose request the check, place of protest is protested, a message about, that the check was presented for payment to the payer and the payer’s response with the refusal to pay was received either no response or payment, or the payer was not found.

The protest act is handed to the holder along with the original of the unpaid check.

In addition to protesting, the check holder, faced with the fact of his non-payment, must notify the latch and the previous endorser within 4 -x days if he received the check by endorsement. The notice must be made in any form, including the refund of the unpaid check. Notification is a legally significant act. An obligated person who has not made the specified notice, having paid the check to his holder, loses the right of recourse to other persons obliged by check, namely: endorsers, avalists, who are responsible for paying the check as joint debtors.

In case of late payment, the check holder has the right to demand from any person (player, chekoder, endorser, guarantor) to pay, in addition to the amount indicated on the check, also the costs associated with the protest and notification, as well as interest per delay, if any. Interest is calculated from the date of presentation of the check to the person obligated by check. In turn, the person who made the payment on the check has the right to demand from the holder of the check the transfer of the check, the act of protest and other documents to him, confirming the amount of the payment made by him for the subsequent recourse to other persons required by check.

The endorser, the guarantor who paid for the check, pays off his obligations under the check, as well as the obligations of all persons who signed the check after him, so he has the right to cross out his endorsement, as well as all the endorsement set after him.