22 thoughts on “Bouncing Checks, Grace Periods and the Enhanced Community Quarantine

  1. AvatarShan Jacobe

    I have a situation. My check, dated November, is about to be stale by the first week of May and I’m not allowed to go outside due to the ECQ since I don’t have a quarantine pass. I was in my province until February and was only able to claim the cheque, which was addressed in QC, probably in March, a few days before the quarantine has been implemented. Is there something else I can do to encash it or is there an exception esp if ECQ lasts longer than expected? Kindly advise. Thank you.

    Reply
    1. pnlpnl

      Hi Shan. That is a very interesting topic. There is a related discussion on “force majeure” during the ECQ period, here: https://pnl-law.com/blog/covid-19-lockdown-fortuitous-event-or-force-majeure-exemption-from-obligations/

      However, a check is deposited with a bank and we suspect that because banks are governed by strict regulations, the bank will most probably hesitate to clear a stale check. Please note that banks are open and checks are still being cleared during the ECQ period. Good luck.

  2. AvatarEke Balanquit

    Good day. I have issued PDCs to the developer for the monthly payment for the equity for the house unit that I applied for acquisition. I would like to know if I can still enjoy the 30-day grace period without penalty obligations since my case is I think different from rental or lease that RA 11469 has been specifically mentioned. I am planning of withdrawing my fund and use it for our daily necessities while we are still on ECQ. I am just worried that if the bank process the PDC then I have insufficient balance I may be held liable for bouncing checks or I may be penalized by the developer. I would highly appreciate it if you could give me some advice/clarifications in layman’s term. THANK YOU!

    Reply
    1. pnlpnl

      Hi Eke. We already noted somewhere that the guidelines only cover loans. It would seem that installments in purchase transactions are not covered. You may want to discuss the matter with your developer. Good luck.

  3. AvatarJobie de jesus

    Hello, good morning po, i have concern about my PDC condo Rental, ang nangyari po is yong march 2020 and April 2020 na check ko in nag bounce check because of sufficient funds dahil nagkaroon ako ng financial problem during the ECQ period but somehow nakita while ago sa Checkque account ko nagkaroon ako ng penalty charges dahil sa bounce check ang gusto lang po malaman pwede ko po kaya ipawavied yong penalty charges na dineduct sa account ko sa bank branch ko…Babayaran ko naman po yong dues ko for rental but not this time especially habang ECQ Period pa po… please advice po…. maraming salamat

    Reply
    1. pnlpnl

      Hi Jobie. So long as the check payment covers rentals falling due on the ECQ, there should be no charges (shouldn’t have been deposited in the first place). Good luck.

  4. AvatarGirlie

    Hi! I have PDC check issued for car insurance dated May 30. I may not have sufficient money to fund it as our office is temporarily closed because of ECQ and until further notice and we have no-work, no-pay scheme. Can I ask the bank not to deposit or clear said check?

    Reply
    1. pnlpnl

      Hi Girlie, no harm in negotiating with your insurance company. Note, however, that the grace period is for loans. Payments for car insurance is not a loan. Good luck.

  5. AvatarRelly

    Good pm po atty.. I issued cheque to my supplier on march to may,, exactly lock down,, this coming june he try to pick on the bank.. Then bounce check and i suffer to pay a penalty,, this is possible in the bank, we should not give penalty during lock down?

    Reply
    1. Avataraiko Unemoto

      Good morning, i would like to know your contact number to ask about legalities during covid. im about to file a case its an investment scam so i guess case would be. “estafa through falscification” and “bouncing cheques”.
      may i know your contact number or any means to contact you directly.

    2. pnlpnl

      Hi Relly. First off, the grace period is only for rents and loans. All other obligations, including supply or sales, are not covered. Good luck.

  6. AvatarKaren Felipe

    Hello. May I be able to encash my salary loan check that expired last April 30, 2020 and issued on January 2020? I only received my check today from my employer because of the ECQ. Please help me what should I do regarding this matter. Thank you and have a nice day.?

    Reply
    1. pnlpnl

      Hi Karen. Unfortunately, banks won’t clear the stale checks. One option is to ask the employer is to re-issue the check. Good luck.

  7. AvatarRubi

    Hi! First of all, thank you for providing this venue. The article is enlightening po. I hope you can help me with my concern. It has to do with the PDCs I issued with my landlord for our unit rental. My checking account is that of a small saving bank and the branch that is close to my place of residence closed together with most of the bank’s branches at the height of the ECQ. In April, I informed my landlord about it and we agreed that I’ll pay in cash for the meantime and he’ll just return my check and that’s what actually happened.

    The same set up is what I had in mind when the ECQ was extended until May and so by May 11 (checks are due every 15th of the month), I gave him a heads up about the arrangement and also requested for a payment extension because my mother was in the hospital and we needed cash on hand as the hospital’s card facility was always offline and lining up at the bank to withdraw (beyond the maximum for ATM, I’m referring to another bank (more established) I have an account with but it’s just plain savings) takes too long because of social distancing. Fully understanding the situation, my landlord agreed. In the morning of May 15, I even dropped by to remind him about it before going to the hospital. By this time, the branch is already open though their operations are limited. At first they were only open TTh and eventually they moved to MWF. My mother passed on on May 16 and we buried her on May 19. By May 22, I paid my landlord the rental for the month of May in cash.

    Yesterday (May 31), my landlord paid me a visit and I thought that it was to return my check. Unfortunately, it was to inform and apologize to me about a miscommunication. He said that confusion led to their messenger depositing my check and he offered to shoulder the penalty charges it incurred.

    Earlier today, I went to the bank to inquire about it and after checking, the manager confirmed that it was deposited on May 20. I asked for penalties that I need to settle and he said there’s no need for it because they already closed my account for insufficient funds. When I asked if there is anything that can be done about it, he said that nothing can be done about it anymore.

    I was upset, dismayed and disappointed and I also needed to go back home because I had a virtual meeting to attend. But I’ve asked some people and since it was first time to issue a check with insufficient funds and it even happened during ECQ, I hope that you can confirm whether it’s true that accounts can only be closed after having checks bounced twice and consideration can be given considering the circumstance. May I also ask if it’s really proper for the bank not to have notified me about it (they’re not required to initiate the communication)?

    Thank you very much and God bless.

    Reply
  8. AvatarJessie

    Hi, attorney.

    What happens to personal loans(with PDC) that you can no longer pay due to losing your income and even losing your job because of covid19 pandemic?
    Makukulong po ba ung di makabayad dahil bankrupt na?

    Reply
  9. AvatarAra

    Hi, would like to know any remedy if the bouncing checks were due to lapses on the part of bank employee. For example, bank grants grace period to pay the loans until end of June. Client already issued PDCs but balance is still insufficient funds and promise to fund the PDC on a certain date agreed. However the bank employee processed the PDC for the payment of loans in advance versus the agreed date. Hence client was charged for bouncing checks as the issued PDC was still not funded. Hoping for your kind assistance.

    Reply
  10. AvatarCyn Claudio

    Hi Atty.. thank you in advance for noticing my message. My seller client sold his condo unit. The pinoy buyer my client too… is a resident of japan, but travels because of business weekly in the Phlis. Because of the Travel Ban caused by Covid 19 His PDCs for March April and May have not been funded. The pdcs bounced.
    Is the buyer liabke for bounced checques?
    Is there a proviision in the Bayanihan Act to protect my client buyer this pandemic times? Help pls…

    Reply
    1. pnlpnl

      Hi Cyn. First off, sorry we cannot give any legal advice in the absence of an attorney-client relationship. By way of general information, and as discussed in another post, BP 22 is meant to punish the mere issuance of a worthless check. COVID and the quarantine, however, creates a difficult situation that will definitely affect BP 22 cases (if one is filed). Note that the penalty may only be a fine (for the value of the check), considering that good faith is presumed. Refer to this post: https://pnl-law.com/blog/bouncing-checks-bp-22/

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