I'm looking for any informed opinion on a rather specific issue.
In the eyes of most small claims courts and judges ... is it
generally
considered wrong to stop payment on a check for goods and services?
I am a small claims judge pro-tem sometimes (including this
afternoon).
If there is intent to defraud, then stopping payment is fraud.
If there is no intent to defraud, there is nothing "wrong" with
stopping payment, but that doesn't make the check valueless. The
check remains a dishonored negotiable instrument regardless of whether
the customer or the merchant is right. The merchant who recieved the
check can sue on the check and win. If the customer has a grievance
against the merchant, about breach of contract or breach of warranty
or whatever, the customer can countersue the merchant in the same
case. But regardless of who wins on that counterclaim, the merchant
wins on the check claim. If the customer wins the counterclaim, then
the merchant owes $X to the customer and the customer owes $Y to the
merchant. A net of those set-offs will be the judgment.
I run a
computer service business and have successfully sued people for
stealing
from me and my business via writing checks for goods and services
and then
subsequently stopping payment on those checks. However, because I
want to
take no chance of loss with these scumbags ... I always hire an
attorney and
sue for the the full amount the check plus court costs plus
attorneys fees
plus anything else I can add in. This works well in the long run ..
but is a
major pain in the short run. Attorneys generally don't like to do
cases for
anything less than $1000 on a bad debt of any sort.
I have no criticism for your practice. But you're a bit out of tune
regarding the attorneys. Attorneys in the collection business like to
do collections. You simply need to find an attorney in the right
field. As for the small collections, it's not a matter of an attorney
not liking small ones, or not being willing to do small ones, it's
simply that the legal fees are larger than the recovery, and clients
are obviously unwilling to pay $2 to collect $1. The attorney knows
when you call and describe the case that you will balk at the fees.
So the attorney advises you to go to small claims rather than listen
to you gripe about paying $2 to collect $1.
To me and most ... it seems like a no brainer. If you pay for goods
and
services (I also have the customers sign and initial a satisfaction
clause
along with bad check policies, etc) this indicates satisfaction and
is
payment in full at the time of payment. In other words if you pay
for goods
and services in cash ... and for (whatever?) reason decide that you
have the
right to take back ALL of the payment you have given to a business
without
going to court ... you would of course be strong arm robbing that
business
or individual and would likely wind up in jail or worse. So, what is
the
view in small claims courts? Are all of these cases generally slam
dunks?
Check cases are very easy. If plaintiff tells a two minute story
saying all the right things, hands over the check (and the certified
letter if applicable) its over. Judgment for plaintiff for the amount
of the check and maybe statutory penalties. If the customer has a
counterclaim, that can take some time and isn't a slam dunk. If the
customer doesn't actually file a counterclaim, but has a story about
breach of contract or whatever, the small claims judge can accept the
customer's story and will treat the customer's damages as a set-off
against the merchant's claim. But the merchant wins on the check
claim.
I'm wondering if I have to keep paying up front for an attorney when
this
happens.
I can't advise on whether you would be better off, but certainly it's
possible to handle check cases yourself in small claims court.
Happens every day.
McGyver
