The Legal System

IT SEEMS THAT WE ARE RECEIVING MORE AND MORE BAD CHECKS FROM OUR CUSTOMERS. WHILE WE HATE TO HAVE TO GO TO SUCH EXTREMES, I HEARD THERE WAS A LAW THAT WOULD ALLOW US TO SUE OUR CUSTOMERS TO RECOVER ON THESE CHECKS. IS THERE SUCH A LAW?

You are correct and as a matter of fact, effective January 1, 1996, Governor Pete Wilson signed into law a bill increasing the amount small businesses and individuals can recover from bad check writers from $500 to $1,500. If you receive a check from a customer that bounces, in addition to the amount of the check itself, you now may sue the check writer for the lesser of:

(i) three (3) times the amount of the check; or,

(ii) $1,500.