Cashing a cheque marked "final payment" can be liberating for the issuer, unless the recipient informs them that cashing it does not release them from their obligations and gives them time to react.
Who hasn't written the words "paiement final" on a check? Writing such a mention can have a liberating effect for the person issuing it, with certain reservations, however.
For example, a hotel owner, dissatisfied with the performance of their new management software, agrees with their supplier to terminate the contract. Following an exchange of letters, the supplier reimburses the hotel owner and sends them a check in the mail for the amount of $4,296.19, with the mention "final settlement of the case".
After this sending, only a formal notice is addressed by the hotel owner and sent to the supplier by fax and registered mail, two months after the supplier sent the check, on July 24. This formal notice, in addition to claiming a lump sum, states that the check will be cashed on July 26 and that it will not be accepted as "final settlement". The evidence shows that the hotel owner actually cashed the check on July 23, and that the mention "final settlement of the case" had been crossed out.
The hotel owner sues the supplier and claims, in addition to the cashed check, a lump sum as damages. The Court* concludes that if the words "paiement final" are written on a check, the person who receives it cannot cash it and pursue their claim. Thus, the fact that the hotel owner cashed the check constitutes their acceptance of the offer made by the supplier to settle the dispute. However, if the hotel owner wanted to cash the check as a partial payment while retaining their right to an additional claim, they had to inform the supplier and give them time to react in order to stop payment on the check.
Cashing a check with the words "paiement final" can be liberating for the person issuing it, unless the person who cashes it is informed that cashing it does not release them from their obligations and they are given time to react. Be careful, by being too quick on the trigger, you might end up shooting yourself in the foot.
*CA 500-09-015799-059, 2006-09-25
