Certified Check

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Certified Check

A written order made by a depositor to a bank to pay a certain sum to the person designated—the payee—which is marked by the bank as "accepted" or "certified," thereby unconditionally promising that the bank will pay the order upon its presentation by the payee.

A certified check is considered the equivalent of cash since the bank, by its certification, guarantees it to be cashable. No bank is under a duty to its depositors or anyone else to certify checks since it involves the assumption of a new obligation for which it is primarily responsible. It is a commonplace practice, however, and there is usually a small fee for this service. A certified check is often required by a payee who does not want to rely only upon the credit of the drawer, the person who wrote the check.

A payee who requires a drawer's check to be certified ensures his or her right to payment. Not only can the payee seek payment from the certified bank, but if for some reason the bank refuses to pay, the payee retains the right to enforce payment from the drawer. In this situation the bank is primarily liable while the drawer is secondarily liable.

Occasionally the payee or subsequent holder of the check—a person who has been legally given possession and the right to payment—will present the check to the drawer's bank for certification. Although the bank is obligated to cash the check, it need not certify the check because only it, not the drawer or any subsequent endorsers, would be liable for its payment. Some banks will certify a check in such instances only with the approval of the drawer.

If a bank refuses to pay a check that it has certified, its drawer or holder may sue the bank for its wrongful conduct, called dishonor. A certified check, a type of Commercial Paper or negotiable instrument, is governed by Article 3 of the Uniform Commercial Code.

certified check

n. a check issued by a bank which certifies that the maker of the check has enough money in his/her account to cover the amount to be paid. The bank sets aside the funds so that the check will remain good even if other checks are written on the particular account. Like a cashier's check, a certified check guarantees that it is immediately good since it is guaranteed by the bank and the recipient does not have to wait until it "clears." (See: cashier's check)

References in periodicals archive ?
Confusing wording does say she is a winner, and it does say there is a prize of pounds 8,700 payable by certified cheque.
The warrant certificate must be submitted together with (i) a duly completed and executed subscription, in the form attached to the warrant certificate or in the form that was mailed to registered warrantholders with the Notice of Special Meeting of Warrantholders and Management Information Circular, each dated June 28, 2005, specifying the number of warrants that the holder intends to exercise; and (ii) a certified cheque, bank draft or money order in Canadian dollars, payable to or to the order of the Company in an amount equal to the Cdn$1.
If the successful bidder has submitted a certified cheque, bank draft or letter of credit in lieu of bonding, the bidders certified cheque, bank draft or letter of credit will be retained for the duration of the project as both bid and performance security.
Just AS&K (Inc) also allows clients to pay incorporation fees by the more traditional methods of wire transfer, certified cheque or payment through their trust account.
Or a - Certified cheque in an amount not less than 10% of the Total Tender Price.
e) a guarantee by the Shareholder that all of the Accounts Receivables of Lighting are collectible within 120 days of the Closing, failing which the consideration paid by the Corporation shall be adjusted in the face amount of the un-collected Accounts Receivable 121 days after the Closing, firstly be reducing the number of Preferred Shares to be issued to the Shareholder for any amount less than 5 percent of the aggregate Account Receivables at Closing, and secondly by a certified cheque payable to Lighting by the Shareholder for the balance of such uncollected Accounts Receivable.
at its principal office in Montreal, the warrant certificates together with a duly completed and executed subscription form, in the form set forth on the reverse of the warrant certificate with cash, a certified cheque, a bank draft or a money order in an amount equal to the total subscription price.
Any holder wishing to exercise its warrants must forward to General Trust of Canada, at its offices in Montreal, the warrant certificates with the reverse side duly completed and executed together with cash, a certified cheque, a bank draft or a money order in an amount equal to the total subscription price.
and will deliver a certified cheque to them in the amount of $150,000 before the 24th of May.
Tenders must be accompanied by a bid security in the form of a Bid Bond or certified cheque in the amount of 10% of the tendered price, payable to the City of Regina and a Consent of Surety to furnish a Performance Bond in the amount of 25% of the tendered price.
Bidders Must Furnish A Certified Cheque Or Bank Draft In The Amount Of Twenty Thousand Dollars ($20,000.

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