We have a customer who purchased a number of cashier’s checks dating back to 2014 that he has not yet delivered to the payees. Can we request that he redeem those checks or allow us to reissue them with more current dates?

We believe that you may request — but not require — the customer to surrender the checks to your bank and have them reissued.

The Illinois Supreme Court has recognized that the remitter of a cashier’s check remains the owner of the check until it has been remitted to the payee, and therefore the remitter may cancel the check at any time before it is delivered to the payee. However, there is no legal mechanism for compelling your customer (the remitter) to surrender and cancel the cashier’s checks. Cashier’s checks generally remain enforceable against the issuing bank until presented for payment or presumed abandoned.

Note that if any of the outstanding cashier’s checks were lost, destroyed or stolen, the Uniform Commercial Code (UCC) permits — but again, does not compel — your customer to submit a declaration of loss (the content of which is fully described in the UCC). In such a case, your bank could then reissue the missing checks.

For resources related to our guidance, please see:

Gillespie v. Riley Management Corp., 59 Ill.2d 211, 217 (1974) (“. . . the purchaser of a cashier’s check remains the ‘owner’ thereof until such time as he delivers or negotiates it to the payee. Until such delivery, the purchaser retains the right to cancel.”)

Illinois UCC, 810 ILCS 5/3-412 (“The issuer of a note or cashier's check . . . is obliged to pay the instrument (i) according to its terms at the time it was issued or, if not issued, at the time it first came into possession of a holder . . . The obligation is owed to a person entitled to enforce the instrument or to an indorser who paid the instrument under Section 3-415.”)

Illinois UCC, 810 ILCS 5/3-312(a)(3) (“‘Declaration of loss’ means a written statement, made under penalty of perjury, to the effect that . . . the declarer cannot reasonably obtain possession of the check because the check was destroyed, its whereabouts cannot be determined, or it is in the wrongful possession of an unknown person or a person that cannot be found or is not amenable to service of process.”)

Illinois UCC, 810 ILCS 5/3-312(b) (“A claimant may assert a claim to the amount of a check by a communication to the obligated bank describing the check with reasonable certainty and requesting payment of the amount of the check, if (i) the claimant is the drawer or payee of a certified check or the remitter or payee of a cashier’s check or teller’s check, (ii) the communication contains or is accompanied by a declaration of loss of the claimant with respect to the check, (iii) the communication is received at a time and in a manner affording the bank a reasonable time to act on it before the check is paid, and (iv) the claimant provides reasonable identification if requested by the obligated bank. Delivery of a declaration of loss is a warranty of the truth of the statements made in the declaration. . . .”)