§ 6-21.3. Remedies for returned check.
§6‑21.3. Remedies for returned check.
(a) Notwithstanding anycriminal sanctions that may apply, a person, firm, or corporation who knowinglydraws, makes, utters, or issues and delivers to another any check or draftdrawn on any bank or depository that refuses to honor the same because themaker or drawer does not have sufficient funds on deposit in or credit with thebank or depository with which to pay the check or draft upon presentation, andwho fails to pay the same amount, any service charges imposed on the payee by abank or depository for processing the dishonored check, and any processing feesimposed by the payee pursuant to G.S. 25‑3‑506 in cash to the payeewithin 30 days following written demand therefor, shall be liable to the payee(i) for the amount owing on the check, the service charges, and processing feesand (ii) for additional damages of three times the amount owing on the check,not to exceed five hundred dollars ($500.00) or to be less than one hundreddollars ($100.00). If the amount claimed in the first demand letter is notpaid, the claim for the amount of the check, the service charges and processingfees, and the treble damages provided for in this subsection may be made by asubsequent letter of demand prior to filing an action. In an action under thissection the court or jury may, however, waive all or part of the additionaldamages upon a finding that the defendant's failure to satisfy the dishonoredcheck or draft was due to economic hardship.
The initial written demand forthe amount of the check, the service charges, and processing fees shall bemailed by certified mail to the defendant at the defendant's last known addressand shall be in the form set out in subsection (a1) of this section. Thesubsequent demand letter demanding the amount of the check, the servicecharges, the processing fees, and treble damages shall be mailed by certifiedmail to the defendant at the defendant's last known address and shall be in theform set out in subsection (a2) of this section. If the payee chooses to sendthe demand letter set out in subsection (a2) of this section, then the payeemay not file an action to collect the amount of the check, the service charges,the processing fees, or treble damages until 30 days following the written demandset out in subsection (a2) of this section.
(a1) The firstnotification letter shall be substantially in the following form:
This letter is written pursuant to G.S. 6‑21.3to inform you that on ________________, you made and delivered to the businesslisted above a check payable to this business containing your name and addressin the sum of $________, drawn upon ________________ (bank or institution),account # _______________. [If the check was received in a face‑to‑facetransaction insert this sentence: This check contained a drivers licenseidentification number from a card with your photograph and mailing address,which was used to identify you at the time the check was accepted.] [If thecheck was delivered by mail insert this sentence: We have compared your name,address, and signature on the check with the name, address, and signature onfile in the account previously established by you or on your behalf, and thesignature on the check appears to be genuine.] Also, we have received no informationthat this was a stolen check, if that is the circumstance.
The check has been dishonored by the bank for thefollowing reasons:
___________________________________________________________________________
Asacceptor of the check, we give you notice to rectify any bank error or othererror in connection with the transaction, and to pay the face value of thecheck, plus the fees as authorized under G.S. 25‑3‑506 and G.S. 6‑21.3(a)as follows:
Facevalue of the check # $__________________
Processingfee authorized
under G.S. 25‑3‑506 $__________________
Bankservice fees authorized
under G.S. 6‑21.3 $__________________
Total amount due: $__________________
If thetotal amount due listed above is not paid within 30 days of the mailing of thisletter, thereafter we may file a civil action to seek civil damages of threetimes the amount of the check (with a minimum damage of one hundred dollars($100.00) and a maximum damage of five hundred dollars ($500.00)) for allegedlygiving a worthless check in violation of law (G.S. 6‑21.3), in additionto the amount of the check and the fees specified above.
Appropriate relief will then be sought before a courtof proper jurisdiction for full payment of the check plus all costs, trebledamages, and witness fees.
If you do not believe you are liable for theseamounts, you will have a right to present your defense in court. To pay thecheck or obtain information, contact the undersigned at the above businesslocation. Cash or a bank official check will be the only acceptable means ofredeeming the dishonored check.
If you do not believe that you owe the amount claimedin this letter or if you believe you have received this letter in error, pleasenotify the undersigned at the above business location as soon as possible.
(a2) If the total amountdue in subsection (a1) has not been paid within 30 days after the mailing ofthe notification letter, a subsequent demand letter may be sent and shall besubstantially in the following form:
On __________________, we informed you that wereceived a check payable to this business containing your name and address inthe sum of $ __________, drawn upon _____________________ (bank orinstitution), account # ______________________. This check containedidentification information which was used to identify you as the maker of thecheck. Also, we have received no information that this was a stolen check, ifthat is the circumstance.
The check has been dishonored by the bank for thefollowing reasons:
___________________________________________________________________________
We notified you that you were responsible for the facevalue of the check ($________) plus the fees authorized under G.S. 25‑3‑506($________) and G.S. 6‑21.3(a) ($________) for a total amount due of $_____________. Thirty days have passed since the mailing of that notificationletter, and you have not made payment to us for that total amount due.
Under G.S. 6‑21.3, we claim you are now liablefor the face value of the check, the fees, and treble damages. The damages weclaim are three times the amount of the check or one hundred dollars ($100.00),whichever is greater, but cannot exceed five hundred dollars ($500.00). Thetotal amount we claim now due is:
Facevalue of the check $__________________
Processingfee authorized
under G.S. 25‑3‑506 $__________________
Bankservice fees authorized
under G.S. 6‑21.3 $__________________
Threetimes the face value of the
check, with a minimum of$100.00
and a maximum of $500.00 $__________________
Total amount due: $__________________
Payment of the total amount claimed above within 30days of the mailing of this letter shall satisfy this civil remedy for thereturned check.
If payment has not been received within this 30‑dayperiod, we will seek appropriate relief before a court of proper jurisdictionfor full payment of the check plus all costs, treble damages, and witness fees.
If you do not believe you are liable for theseamounts, you will have a right to present your defense in court. To pay thecheck or obtain information, contact the undersigned at the above businesslocation. Cash or a bank official check will be the only acceptable means ofredeeming the dishonored check.
If you do not believe that you owe the amount claimedin this letter or if you believe you have received this letter in error, pleasenotify the undersigned at the above business location as soon as possible.
(b) In an action undersubsection (a) of this section, the presiding judge or magistrate may award theprevailing party, as part of the court costs payable, a reasonable attorney'sfee to the duly licensed attorney representing the prevailing party in suchsuit.
(c) It shall be anaffirmative defense, in addition to other defenses, to an action under thissection if it is found that: (i) full satisfaction of the amount of the checkor draft was made prior to the commencement of the action, or (ii) that thebank or depository erred in dishonoring the check or draft, or (iii) that theacceptor of the check knew at the time of acceptance that there wereinsufficient funds on deposit in the bank or depository with which to cause thecheck to be honored.
(d) The remedy providedfor herein shall apply only if the check was drawn, made, uttered or issuedwith knowledge there were insufficient funds in the account or that no creditexisted with the bank or depository with which to pay the check or draft uponpresentation. (1975, c. 129, s. 1; 1981, c. 781, s. 2; 1985, c. 643;1993, c. 374, s. 1; 1995, c. 356, s. 1; 1995 (Reg. Sess., 1996), c. 742, s. 5.)