Drawer, Payee, and Check Authenticity: Legal Relationships and Responsibilities
A) Relationship Between Drawer and Drawee
The internal relations between the drawer and drawee are governed by contract. This agreement is normally part of a broader banking contract and is usually established when the customer receives their checkbook. The drawee bank is obligated to honor validly issued checks if sufficient funds are available.
A key issue is the effectiveness of check revocation (Art. 138.1). Revocation has no effect until after the submission deadline. If the bank pays before the deadline, it is considered a legitimate payment, even against the drawer’s will. The bank is not obligated to follow a stop payment order before the deadline and incurs no liability. Conversely, the bank can accept a revocation and refuse payment without liability to the holder. Some argue that revocation acts as authorization for non-payment.
However, Art. 108.2 suggests the drawee is liable to the holder if sufficient funds are available and the check is valid, but payment is not made. This implies the bank must pay valid checks despite revocation, or risk liability. The bank cannot act on a stop payment order; it must follow the check’s instructions. This strengthens the check’s function as a payment method.
The bank’s obligation to pay is limited to the check’s presentation period. After this, the bank can pay if there was no revocation. If the drawer issued a stop payment order before or during this period, the bank must comply and refuse payment (Rule 138.2).
B) Relationship Between Drawer and Payee
Following check issuance, legal relations emerge between the drawer and the payee. Normally, the check pays a debt from the drawer to the payee. Sometimes, it’s a loan or donation. In any case, an exchange relationship is added to the underlying relationship, with the drawer guaranteeing payment.
Typically, the check extinguishes a pre-existing debt. This depends on the agreement:
- Pro soluto: The check replaces the underlying obligation, extinguishing it.
- Pro solvendo (usual case): The check facilitates payment, but the debt isn’t extinguished until the check clears. If the check is unpaid, the causal action is suspended, then either extinguished (Art. 1170 CC) or revived if the payee is unsatisfied.
C) True or Counterfeit Check
1. Legal Framework
LC Section 156 addresses who bears the loss from payment of a check with a misrepresented drawer’s signature (forgery) or altered content (counterfeit). It doesn’t clarify liability for other signatories (Art. 116 LC) or if the forger’s responsibility aligns with the person whose signature was faked (analogous to Art. 117 LC). Section 156 doesn’t cover forged checks; Article 93 LC applies to altered text, limiting the drawer’s liability to the original terms, even if a third party acquires the check in good faith.
2. Bank’s Responsibility
Article 156 LC states the bank bears the loss from paying a forged or counterfeit check, assuming it acted diligently as an entrepreneur and followed banking techniques. This liability arises from breaching contractual obligations, specifically, paying checks not issued by the drawer or altered after issuance. This breaches the check contract’s purpose. However, general obligation principles require willful or negligent action for liability. Section 156 uniquely derives direct responsibility from the material fact of payment, regardless of fault (STS 15 July 1988, but see STS 18 July 1994). The bank bears the risk of a false or forged check, even without fault, and cannot debit the client’s account (or must refund it).
3. Limitations and Shared Responsibility
The drawee bank’s liability, while objective, isn’t absolute. LC Rule 156 provides an exoneration clause: if the account holder (forged check) or drawer (counterfeit check) acted negligently (e.g., not safeguarding the checkbook or failing to report loss promptly), the bank, if diligent, can impute the consequences to them. Often, both the bank and customer are negligent “double negligenc”). In such cases, the doctrine of shared blame applies, and damages are distributed based on each party’s contribution to the payment of the check (STS 18 July 1994).