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You wrote, A stop payment does not mean that the check won't be paid or that it ends his liability for the check.

Well... Actually, it sort of does. If the bank takes payment for a stop and the check clears after the stop was placed, the bank is liable for the check.

They're liable because they've taken a payment to stop payment. They can't simply take money from you for a service and fail to deliver. And because they're doing this to make a profit, they're not just liable for the $10-20 they took in payment. Instead they're liable for any damages you incurred.

When I was very young I had this argument with a large local bank. After a lot of yelling and complaining, a manager refunded the stop payment fee; but I was still stuck with the loss. (I don't think it was very much, nor do I remember the exact circumstances behind it now.)

I later discovered that Texas banking laws specificaly cover this case [Section 4.403 of the Texas Business and Commerce Code ( ) (full text is below)] and requires the bank to indemnify you against a stopped check, so what the bank had done to me was a direct violation of state banking law; but by then I think it was too late for me to sue them for it.

To quote 4.403 of the Texas Commercial Code:
PROOF OF LOSS. (a) A customer or any person authorized to draw on
the account if there is more than one person may stop payment of any
item drawn on the customer's account or close the account by an
order to the bank describing the item or account with reasonable
certainty received at a time and in a manner that affords the bank a
reasonable opportunity to act on it before any action by the bank
with respect to the item described in Section 4.303. If the
signature of more than one person is required to draw on an account,
any of those persons may stop payment or close the account.
(b) A stop-payment order is effective for six months and is
binding on the bank only if it is in a dated, authenticated record
that describes the item with certainty. A stop-payment order may be
renewed for additional six-month periods by an authenticated record
given to the bank within a period during which the stop-payment
order is effective.
(c) The burden of establishing the fact and amount of loss
resulting from the payment of an item contrary to a stop-payment
order or order to close an account is on the customer. The loss from
payment of an item contrary to a stop-payment order may include
damages for dishonor of subsequent items under Section 4.402.

Unfortunately, the next section allows a Texas bank to refuse payment on a check that is more than six months old; but it also effectively allows a Texas bank to pay old checks regardless of the date...

- Joel
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