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Home >> Checks/Money Orders >> Checks You Received
Bank Deposited Check with Two Payees into One Account
A check was issued to another person and me, with both of our names on the payee line, but no and/ or between them. The other person deposited the full amount of the check into his own bank account without my endorsement. The person who issued this check intended that each party receive half of the amount on the check.
The bank that deposited this check claims that it interpreted the check to be for one party, because the person who wrote the check did not include "and" between the names. Does this violate endorsement laws? Can the bank arbitrarily apply language to a check that is not provided by the issuing bank?
The depositing bank wrote me a letter telling me that this is a problem between me and the other person on the check. However I feel that the bank violated endorsement provisions in depositing all of the money into one account. Am I correct? What recourse do I have? How should I go about resolving this issue?
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 Actually, the law is on the bank's side on this question. Under the Uniform Commercial Code, which is a state law adopted by all of the stated with more-or-less uniform provisions, section 3-110, if a check is payable to two or more persons "alternatively," it may be negotiated by any one of the payees. In order to be payable not alternatively, all of the payees must negotiate it. In order to ensure that a check is not payable alternatively, the payees have to be joined by the word "and" or an ampersand ("&"). When there is no indication of whether the payees are listed alternatively (when there is no "and" or "&"), the payees are considered to be named alternatively. If the person who issued the check wanted to ensure that all payees had to endorse the check, the payees should have been joined using the word "and."
Published on BankingQuestions.com 11/06/07
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