G. Bradley Hargrave, Esq.
Every business that relies on check acceptance for increased sales is exposed to the risk of stop payments. Despite the fact that consumers may believe that a stop payment is equivalent to a discharge of the obligation to pay, the act of stopping payment, in and of itself, has no impact whatsoever on the check writer's obligation to satisfy the underlying debt.
Every check writer has virtually an unqualified right to order a stop payment. The reasons for this rule are clear: as a check is an order on a bank to pay a fixed sum of money, the check writer is free to revoke that order until such time as the bank makes final payment. The point for every retailer to remember, however, is that the check writer's right to stop payment is a right against his or her bank, and has no impact on the merchant's right to enforce payment. In fact, a check that is returned because of a stop payment is as enforceable as any dishonored check.
Checks are contracts, and a check writer who refuses to carry through with his/her promise to pay is in breach. Of course, if the check writer is able to prove that he did not receive the goods and services for which the check constituted payment, the obligation will be discharged. But it is his/her argument to make. The retailer is not the party with the burden of proving that the stop payment was wrongful - it is the check writer's responsibility to establish that the stop payment was justified.
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