Court Ruling: You Be the Judge
The litigants are in court because the plaintiff Christina Blasco is arguing that her payday loan check to Money Services Center (MSC) is non-negotiable and therefore cannot be cashed after her filing for bankruptcy. The defendant MSC is arguing that the check is negotiable and therefore can be cashed. Normally personal checks are negotiable and may be cashed after the party files for bankruptcy -- thus MSC should normally be able to cash the check and receive its return on investment in Ms. Blasco. The problem is that Blasco is interpreting a rule about checks, which states that the check itself must state a definite amount -- and the check that she has written, she argues, is ambiguous and indefinite because the words do not precisely match the numerical amount stated (and in such cases it is the words that take precedent). Because the words are ambiguous, Blasco says the check is non-negotiable and cannot be cashed. MSC argues that the words are ambiguous but that they do not contradict the numerical amount stated on the check and that therefore the check is clear, negotiable, and may be cashed by the defendant. The level of the court hearing the case is federal, within the U.S. Bankruptcy Court for the Northern District of Alabama.
The issue of the case is: Does ambiguity of words describing the amount of a check invalidate the clear numerical statement of a check's worth according to the Uniform Commercial...
The numerical amount clarifies the written amount and the written amount in its ambiguity does not contradict the numerical amount and therefore does not invalidate it or override it. The check remains negotiable and may be cashed by MSC. Judgment for the defendant is Affirmed.
The legal basis for the court's decision is situated within the context of the Uniform Commercial Code which cedes that words take precedence over numbers on a check if there is a discrepancy. However, in this case, there is no clear discrepancy but rather only ambiguity in the words, and they do not explicitly or clearly contradict the amount/meaning of the numbers written on the check; therefore, the words cannot take precedence over the numbers as they themselves do not indicate a clear amount and thus cannot constitute a substantial priority.
The Legal reasoning to the specific facts of the case regarding the plaintiff Christina Blasco and the defendant Money Services Center are based on the following: the plaintiff has the right to have the negotiable check made non-negotiable following her declaration of bankruptcy if the words written on the check contradict the numerical amount printed on the check because in accordance with the Uniform Commercial Code, words take precedence over numbers (Id. at 153, quoting Tex. Bus. & Com. Code § 3.114). However, as the plaintiff has argued…
