MISSISSIPPI LEGISLATURE

1997 Regular Session

To: Judiciary B

By: Representatives Cummings, Dedeaux, Mitchell, Moss

AN ACT TO AMEND SECTIONS 97-19-55, 75-3-113 AND 75-4-401, MISSISSIPPI CODE OF 1972, TO PROHIBIT WRITING CHECKS KNOWING THAT THE ACCOUNT WILL BE CLOSED BEFORE PAYMENT; TO PROHIBIT POSTDATING CHECKS IF THE PAYEE REFUSES TO EXTEND CREDIT; AND FOR RELATED PURPOSES. 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 97-19-55, Mississippi Code of 1972, is amended as follows:

97-19-55. It shall be unlawful for any person with fraudulent intent to make, draw, issue, utter or deliver any check, draft or order for the payment of money drawn on any bank, corporation, firm or person for the purpose of obtaining money, services or any article of value, or for the purpose of satisfying a preexisting debt or making a payment or payments on a past due account or accounts, knowing at the time of making, drawing, issuing, uttering or delivering said check, draft or order that the maker or drawer has not sufficient funds in or on deposit with such bank, corporation, firm or person for the payment of such check, draft or order in full, and all other checks, drafts or orders upon such funds then outstanding or knowing at the time that the account will be closed before the payment of such check, draft or order. It shall be unlawful to postdate a check, draft or order if the payee refuses to extend credit on such check, draft or order.

SECTION 2. Section 75-3-113, Mississippi Code of 1972, is amended as follows:

75-3-113. (a) An instrument may be antedated or postdated. If the payee refuses to extend credit, an instrument shall not be postdated. The date stated determines the time of payment if the instrument is payable at a fixed period after date. Except as provided in Section 75-4-401(c), an instrument payable on demand is not payable before the date of the instrument.

(b) If an instrument is undated, its date is the date of its issue or, in the case of an unissued instrument, the date it first comes into possession of a holder.

SECTION 3. Section 75-4-401, Mississippi Code of 1972, is amended as follows:

75-4-401. WHEN BANK MAY CHARGE CUSTOMER'S ACCOUNT.

(a) A bank may charge against the account of a customer an item that is properly payable from that account even though the charge creates an overdraft. An item is properly payable if it is authorized by the customer and is in accordance with any agreement between the customer and bank.

(b) A customer is not liable for the amount of an overdraft if the customer neither signed the item nor benefited from the proceeds of the item.

(c) A bank may charge against the account of a customer a check that is otherwise properly payable from the account, even though payment was made before the date of the check, unless the customer has given notice to the bank of the postdating describing the check with reasonable certainty or if the payee refuses to extend credit for postdating. The notice is effective for the period stated in Section 75-4-403(b) for stop-payment orders, and must be received at such time and in such manner as to afford the bank a reasonable opportunity to act on it before the bank takes any action with respect to the check described in Section 75-4-303. If a bank charges against the account of a customer a check before the date stated in the notice of postdating, the bank is liable for damages for the loss resulting from its act. The loss may include damages for dishonor of subsequent items under Section 75-4-402.

(d) A bank that in good faith makes payment to a holder may charge the indicated account of its customer according to:

(1) The original terms of the altered item; or

(2) The terms of the completed item, even though the bank knows the item has been completed unless the bank has notice that the completion was improper.

SECTION 4. This act shall take effect and be in force from and after July 1, 1997.