North Carolina Department of Justice
North Carolina Department of Justice
North Carolina Department of Justice
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March 28, 1978 Consumer Protection; Worthless Checks; Remedies for Returned Check Under G.S. 6-21.3. Five dollars Added to Amount Due Plaintiff Not Collectible Except in Court Action; G.S. 6-21.3, Civil Procedure; Contractual Agreement not Prohibited.

Subject:

 

Requested By: William L. Mills, Jr. Sanitary District Attorney

 

P.O. Box 368 Concord, North Carolina 28025

Question: Under G.S. 6-21.3, is it lawful to charge the drawer of a check the sum of five dollars to defray the costs of processing a check which has been returned because of "no account" or "insufficient funds" without institution of a civil action to recover the cost in court?

 

Conclusion: No. G.S. 6-21.3 contemplates a civil action, and only the presiding judge or magistrate may add the five dollars to the amount owed on the check. However, this statute does not prohibit a contractual agreement between the holder and maker that said amount would be charged for a returned check.

 

G.S. 6-21.3 was enacted by Chapter 129, Session Laws of 1975, an act to provide additional civil remedies for losses caused by acceptance of returned checks. The statute clearly states "In an action by a holder to recover the sum payable of a check drawn by the defendant on which payment has been refused by the payor bank because the drawer had no account or insufficient funds, . . .". (Emphasis added.)

Upon a determination that the plaintiff has prevailed, the presiding judge or magistrate shall add to the amount due to the plaintiff the sum of five dollars to defray the costs of processing the returned check.

Thus only in an action for the recovery of the amount due on such check may the $5.00 be added to the amount of the returned check, unless the holder had a contractual understanding with the maker at the time the check was given that some additional amount would be charged for a returned check.

Rufus L. Edmisten Attorney General

James F. Bullock Senior Deputy Attorney General