If a person pays for goods or services with a check and that check is then dishonored by the bank on which it is written, you may be able to collect on the check by proceeding under the so-called South Carolina Bad Check law.
That law provides that it is unlawful for any person, with intent to defraud, to make, issue or deliver to another a check, whether given to pay rent, make payment on a lease, obtain money, services, credit or property of any kind, when at the time of making, issuing or delivering such check, the maker does not have an account in such bank, does not have sufficient funds on deposit to pay the check, or the check has an incorrect or insufficient signature thereon.
It is important that you understand that not all checks that are dishonored come under this law. For the law to apply certain requirements must be met. First, the payment by check must be made at the same time that the goods or services are delivered. Second, the check must not have been postdated. Third, the maker of the check must not have given you any reason to believe that the check is no good such as asking you to hold it for a few days. Fourth, you must have presented the check for payment within ten days of receipt. Finally, you must have obtained the name, home address and home telephone number of the maker at the time the check is given to you and you must show that you witnessed the maker's signature by initialing the check.
Remember that by proceeding under this law you may cause the arrest of a person, so it is important that you proceed correctly. If you don't the person from whom you are trying to collect may have grounds to file a complaint against you.
Once you have determined that the check in question does come under the Bad Check law, you are required to send written notice to the maker of the check to the address given at the time the check was written. This notice must be sent by certified mail. The notice must include the check number, the date it is written, the amount and the bank on which it was drawn. You must also give the reason why the bank refused payment, advise the maker that payment in full, plus $20.00 service charge, must be make within ten days from the date the notice was mailed and advise the maker that failure to make payment may result in you applying to the criminal court for prosecution under the Bad Check law.
If the check and service charge is paid, then that should end the matter. In the event that payment is not made you must decide whether to institute criminal proceedings against the maker of the bad check. You will have to give the magistrate evidence that you sent the proper notice ten days earlier in order to get a warrant. The law prohibits anyone from using the criminal process to collect a debt; prosecutions are instituted primarily to vindicate the rights of the public by punishing criminal conduct. Therefore, at this point you must be prepared to suffer the loss of the payment in exchange for seeking punishment of the person who gave you a bad check. However, if the maker subsequently pays you after criminal charges have been filed and before a hearing on the matter, you can drop the charge providing that you notify the court at least 24 hours before the court date that the matter has been resolved.
It is strongly suggested that you obtain an attorney to advise you whether you should proceed under the Bad Check law in order to collect on a bad check. Unless all requirements for using the law are met, you could be subjecting yourself to a lawsuit if the maker of the check is arrested and it subsequently develops that the matter should not have been brought under the Bad Check law.
This information was prepared to give you some general information on the law. It is not intended as legal advice about any particular problem. If you have questions about the law you should consult a lawyer. If you do not know a lawyer, you can call the South Carolina Bar Lawyer Referral Service weekdays between 9 a.m. and 5 p.m. The number is 799-7100 in Richland or Lexington Counties, and 1-800-868-2284 from other parts of the state.