How to collecting payment on a stopped check?

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How to collecting payment on a stopped check?

We own a small business in Oregon which sells and installs walk-in bathtubs. In 08/10, we installed a walk-in bathtub for a senior woman. She signed the completion certificate, indicating she was 100% satisfied. She even wrote a smiley face on the $5,400 check, and wrote, “Thanks Murray!” We deposited the check, and days later, it came back NSF. We found out that she stopped payment on the check. She won’t answer her phone or return our calls. The letters we sent have all come back unopened, and the certified letter came back, as well. We know she has the money in her account to cover the check. We tried to contact legal entities in our area, and apparently no one wants to deal with check fraud. What is the best way to proceed?

Asked on November 8, 2010 under Bankruptcy Law, Oregon

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

You are going to have to sue her for the funds and obtain a judgement.  Depending on the monetary limit you may be able to do so in small claims court.  If the amount is above the limit then you will have to sue her in the court of the next level up.  You could also give the matter to an attorney that does collection work but they will take about one-third of the recovery they receive.  That may be worth your time if the matter is above the small claims amount.  It may be a business decision not to waste your own time either.  Once a judgement is obtained against the customer you can levy her bank account or personal assets in a collection proceeding.  Good luck. 


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