Lower coast gazette., 1913-06-21
Popular Talks on Law.
CHECKS AND BANK ACCOUNTS
BY WALTER K. TOWERS, A. B., j. D., of the
Michigan Bar.

John MCGEE owed Warren Gordon five dol
lars for a couple of loads of cordwood. Gordon,
having delivered the wood at McGee's residence
went to McGee's store to secure his money.
MCGEE drew out his check book and signed a
check in the usual form, instructing his bank
to pay to Gordon the sum of five dollars. This
was on Tuesday afternoon about 2 o'clock. The
bank did not close until four, but Gordon know
ing that MCGEE was a responsible man of means
and not needing the cash at that time, decided
ne wouldn't cash the check at once, but would
keep it until he needed money at the end of the
week. Wednesday passed with the bank open
for business in the usual way, but again Gordon
did not present the check for payment. On
Thursday Gordon heard rumors that the bank
was in difficulties and might fail, so he fastened
to it's doors only to find that he was too late
and that they had already been closed. The fail
ure proved complete.
Gordon went to MCGEE and asked that he be
paid the five dollars, insisting that it was Me-
Gees bank that had failed and that he had
never received his pay for the wood delivered.
MCGEE inquired into all the circumstances and
pointed out that had Gordon presented the
check for payment on either Tuesday afternoon
or any time Wednesday it would have been paid
in full. MCGEE further stated that he had had
the money on deposit in the bank and it had
been lost. Had Gordon presented the check
within a reasonable time five dollars, at least,
would havo hoar cauad apd fhoro wac No roacon
why MCGEE should lose the five dollars a second
time. Before the law McGee's position was cor
rect, he was not required to make. good the
check, Gordon having failed to present it for
payment when he reasonably might have at a
time when it would have been paid in full.
The payment of obligations by checks on
bank accounts is a familiar business procedure
in every community, and an examination of the
legal relations of the banker, the depositor who
signs the check and the person to whom he
gives it, is of the greatest practical Importance.
Let us examine the legal significance of a check,
the requirements Of a good check and the obli-
cations of the various parties to it.
The form Of a bank check is familiar enough
to all of us. 1t is usually prepared by filling
in ink or pencil blank spaces in the printed
form provided by the bank. But the entire
check may be written and checks have been
prepared on many substances besides paper.
Lumbermen have whitfield out a smooth single
and written their checks thereon. A young
profligate in Jail, after a spree once tore off his
cuff and wrote on it a check to obtain funds to
secure his release. The requirements is that
the check be in writing of some kind which in
cludes typeWriting, etc.
1t is addressed to a stated bank, which is
directed to PAY to the order of John Jones"
or "Pay to the order of Bearer a certain sum
of money. These words pay to the order Of"
are necessary to the negotiability of the check
that is necessary so that it may fulfill all the
legal requirements and be capable Of passing
by endorsement, etc. A check may be drawn
to Bills Payable" or Rent" or Cash."
and is then payable to bearer.
There is no legal requirement that a check
be dated, but this is a wise and almost inva-
riable custom. Any legal holder Of check may
fill in the date where it has been left blank. A
check may be dated in the past or in the future.
If dated in the past it is.payable at once, and if
dated in the future, it is payable on or after
it's date. While the words ION demand are not
used in a check, they are implied in law, the
understanding being that the bank is instruct
ed by it's deposition to pay to the order Of John
Jones on demand.
A check must be signed by the depositor and
usually in his own hand, though contract rela-
tons between the bank and depositor may au-
thorize the use of rubber stamp, or some such
device in place of a written signature.
In law the person who draws a check and
gives it to another is understood to agree that
he will stand back of the check and see to it
that the person receiving it secures the money
for which it calls, provided he handles it in a
proper and reasonable manner. If the person
receiving a check presents it to the bank within
a reasonable time, and the bank dishonors the
check, and he then gives notice Of this to the
narson who drew II. that drawer is hound to