Printable Format84-4-404. Bank not obligated to pay check more than six months old. A bank is under no obligation to a customer having a checking account to pay a check, other than a certified check, which is presented more than six months after its date, but it may charge its customer's account for a payment made thereafter in good faith.
History: L. 1965, ch. 564, ยง 230; January 1, 1966.
KANSAS COMMENT, 1996
This section has not been amended and is identical to the 1995 Official Text.
If an ordinary check is more than six months old, the drawee bank may pay it and debit the account or dishonor it. The six-month period does not apply to a certified check. The greatest exposure for a bank which pays a stale check is the "good faith" language appearing at the end of this section. "Good faith," now means subjective "honesty in fact and the observance of reasonable commercial standards of fair dealing" under 84-3-103(a)(4), which applies to Article 4 through 84-4-104(c). Several cases under the former definition of "good faith" in 84-1-201(19) held banks liable for paying stale checks under the former section. See, e.g., Advanced Alloys, Inc. v. Sergeant Steel Corp., 12 U.C.C. Rep. 1173 (N.Y. Sup. Ct. 1973); Charles Ragusa & Son v. Community State Bank, 360 So.2d 231 (La. App. 1978). Under these cases, a bank may be liable to its customer if it pays a check known to be very stale without making some inquiry, especially with the broader current definition of good faith. Since most checks are run by computer, the drawee bank would be unaware of the staleness unless the check was large enough to merit individual inspection. It is uncertain what the standard would be for cashier's and teller checks, which, because they are bank obligations, would be treated more like certified checks than ordinary checks.
CASE ANNOTATIONS
1. Payor bank exercised good faith and ordinary care in processing nine-year old check. IBP, Inc. v. Mercantile Bank of Topeka, 6 F. Supp. 2d 1258, 1268 (1998).