Stop Payment and Partial Payment on Issued Checks (Philippine context)

For business owners, in-house counsel, accountants, and bank clients. This is general information, not legal advice.

1) The legal backdrop

Negotiable Instruments Law (NIL, Act No. 2031). Governs checks (a check is a bill of exchange drawn on a bank, payable on demand), presentment, dishonor, acceptance/certification, payment, discharge, and rights of holders/parties.
B.P. Blg. 22 (Anti-Bouncing Checks Law). Penalizes issuing a check that bounces for insufficient funds or credit, or would have bounced for insufficiency but for a stop-payment order; provides a 5-banking-day window after notice of dishonor to fully pay and avoid conviction.
Revised Penal Code, estafa (Art. 315[2][d]). Separate crime when a check is used as deceit to obtain money/property and is later dishonored.
Civil Code & jurisprudence. A check is not legal tender; giving a check does not by itself pay a debt unless accepted and cleared; if dishonored/stopped, the underlying obligation remains.

2) Stop payment: what it is and when it’s effective

Definition. A depositor’s instruction to the drawee bank not to pay a particular check before the bank has paid or certified it.

Timing rules (practical):

Effective only if received in time. If the bank has already paid, certified, or finally posted the check, a stop order is too late.
Form & content. Banks typically require a written order identifying check number, date, amount, payee, and may charge a fee. Many policies make a stop order effective for a fixed period (e.g., 6 months), renewable.
Certification defeats stop. Certified checks (bank’s acceptance written on the check) bind the bank; the drawer can no longer stop payment after certification because the bank becomes primarily liable and segregates funds.
Manager’s/Cashier’s checks. These are the bank’s own checks; purchasers generally cannot compel stop payment absent clear legal grounds (e.g., forgery, fraud, court order). Banks treat them as near-cash obligations.

Bank–depositor relationship. The bank is the debtor of the depositor. If a bank wrongfully pays despite a timely and proper stop-payment order, and the drawer suffers loss, the bank can be liable (subject to proof of loss and compliance with account terms). Conversely, if the bank refuses payment because of a proper stop order, it is not liable to the drawer—but it may face claims from the holder only if the bank breached an independent duty (rare; banks owe their duty primarily to the account holder).

3) Grounds commonly cited for stop payment (and risks)

Loss/theft/forgery of the check leaf; wrong amount/payee; duplicate issuance; contractual disputes (failure of consideration/defective goods); suspected fraud.
Risk alert: Stopping payment does not extinguish the underlying debt. If you stop payment because of a purely civil dispute, you may still face collection suits, and—depending on facts—BP 22 or estafa exposure (see §6–§7).

4) What happens to the holder when payment is stopped

The bank will mark the item “Payment Stopped” (or similar) and dishonor it.
The holder may proceed civilly against the drawer/indorsers (collection, damages).
Under the NIL, notice of dishonor should be given to secondary parties (indorsers) to preserve recourse; drawers are generally charged without notice but giving notice is best practice in disputes.

5) BP 22 interaction with stop payment

Core rule. BP 22 punishes issuing a check that is dishonored for insufficiency of funds/credit or would have been dishonored for insufficiency but for a stop-payment order.

Practical effects:

If a check is returned “Payment Stopped”, prosecutors often ask: Would it have bounced for insufficiency anyway? If yes, BP 22 can still apply.
5-banking-day cure. Upon written notice of dishonor, the drawer may avoid criminal liability by fully paying the face amount (plus bank charges) within five banking days.
- Partial payment is not enough to avoid BP 22; it must be full.
Defenses often misunderstood.
- Failure of consideration (e.g., defective goods) is generally not a BP 22 defense because the law penalizes the act of issuing a worthless check, not breach of contract.
- Claims of good faith or no intent to defraud usually do not acquit under BP 22 (it’s largely malum prohibitum), though they can be relevant to estafa (see §7) or civil outcomes.
- No notice of dishonor (or improper notice) can be fatal to BP 22 prosecution; keep records of what you actually received and when.

6) Estafa (RPC) vs. BP 22

Estafa requires deceit and damage—e.g., issuing a check to induce delivery of goods/money knowing it will bounce.
BP 22 punishes issuance of a worthless check, whether or not it induced a transaction.
You can be sued for both, but you cannot be punished twice for the same act if they constitute the same offense in law and in fact; prosecutors typically choose based on evidence of deceit.

7) Civil effects of stopping payment

A stopped or dishonored check does not pay the obligation. The creditor can:
- Sue on the check (instrument) and/or sue on the underlying obligation.
- Demand damages, interest, and costs under the Civil Code.
If the creditor accepted the check as conditional payment and it later clears, the obligation is extinguished to the extent of the amount cleared. If it is dishonored/stopped, the creditor may proceed as if unpaid.

8) Partial payment: what’s allowed and what is not

At the bank/clearing level.

A check orders payment of the full face amount. The drawee bank does not “partially pay” a presented check. It either pays or dishonors (unless there is a specific legal mandate or a court order, which is exceptional).

Between drawer and holder (rights under NIL).

The holder may accept partial payment from the drawer or other parties and must credit it; rights for the unpaid balance remain (the instrument is not discharged until paid in full). It’s good practice to note the partial payment on the instrument or give a receipt that references the check number and amount.
Partial payment does not avoid BP 22. Only full payment within 5 banking days of notice bars criminal liability under BP 22. Partial payments, however, reduce civil exposure.

Common business uses of “partial payment” with checks.

Instead of altering one check, parties typically issue multiple checks (e.g., P200,000 split into two checks of P120,000 and P80,000) to schedule staged payments; each check stands on its own for NIL/BP 22 purposes.

9) Presentment, notice, and staleness

Presentment: A check should be presented within a reasonable time after issue; in banking practice, checks become stale after 6 months from date—banks may refuse stale items.
Notice of dishonor: Preserve rights against indorsers by timely notice. For BP 22, written notice to the drawer triggers the 5-banking-day cure period. Keep logs and proof of delivery/receipt.
Post-dated checks: Present on or after the date. Issuing post-dated checks that later bounce (or are stopped and would have bounced) risks BP 22 and estafa (if deceit is shown).

10) Special instruments and stop-payment nuances

Crossed checks / “For Payee’s Account Only”. Crossing directs the collecting bank to deposit to the payee’s account; it does not prevent the drawer from stopping payment before final clearing.
Replacement checks & undertakings. When stopping payment due to error/dispute, parties often sign a replacement or settlement agreement: e.g., creditor returns the original check in exchange for new checks or cash; include clear waivers, reservation of rights, and timelines.

11) Practical playbooks

A) For drawers (issuers)

Act fast. If a check is lost/erroneous or fraud is suspected, file a written stop-payment order immediately; confirm receipt with the bank.
Document the reason. Keep internal memos, police reports (if theft), emails with the payee, and bank acknowledgments.
Assess BP 22 risk. If you receive written dishonor notice, fully pay within 5 banking days (cash, cashier’s/manager’s check, or other cleared funds) if you want to avoid criminal exposure—even if you dispute the debt. Reserve civil claims separately.
Negotiate structured settlement (multiple checks or dated installments) to avoid future stops; include default/acceleration clauses and clear receipt protocols.

B) For holders (payees)

Present promptly and keep bank return memos.
On dishonor, send written notice (demand letter) with proof of service; start the 5-banking-day clock.
Decide your remedy mix: civil collection, BP 22 complaint, and/or estafa (if deceit).
Consider security (guarantors, mortgages, pledges) in settlements; accept partial payments only with clear documentation and without waiving the balance unless intended.

C) For banks

Enforce uniform stop-payment procedures; verify identity, require complete particulars, warn of expiry of the stop order, and log timestamps.
If a stop order is late (item already paid/certified/finally posted), document the timing to manage liability.
For manager’s/cashier’s checks, escalate stop requests to legal; require court orders or compelling legal grounds.

12) Frequently asked questions

Can I stop payment because the supplier delivered defective goods? You can, but it does not erase the debt. Expect a collection suit; BP 22 risk persists unless you fully pay within 5 banking days after notice of dishonor.

If I stop payment and there’s enough money in my account, is BP 22 off the table? BP 22 focuses on insufficiency. If the check would not have bounced for insufficiency, prosecution becomes difficult—but once you receive written notice of dishonor, the safest course to avoid BP 22 is to fully pay within 5 banking days.

Will the bank pay part of my check if my balance is short? No. Banks do not partially pay checks. They either pay or dishonor.

Does partial payment save me from BP 22? No. Only full payment within 5 banking days from written notice statutorily avoids criminal liability. Partial payments help civilly.

Can I still stop a check that’s certified or a manager’s check I bought? Generally no for a certified check (bank is already liable). For manager’s/cashier’s checks, stop payment is exceptional and typically requires court order/legal basis.

13) Clean documentation (short templates)

Stop-payment request (to your bank)

I request stop payment on Check No. [], dated [], amount [₱], payable to []. Reason: [loss/error/fraud/contract dispute]. I confirm that I am the authorized signatory. Please confirm receipt and effectivity.

Demand after dishonor (to drawer)

Your Check No. [] for ₱[] was dishonored marked “[reason]”. Under the law, you have five (5) banking days from receipt of this notice to fully pay ₱[amount] plus bank charges; otherwise, we will pursue legal remedies.

Partial-payment acknowledgment (holder’s receipt)

Received from [drawer] ₱[amount] as partial payment for Check No. [] dated [], face amount ₱[]. Balance due: ₱[]. Rights to collect the balance are expressly reserved.

14) Key takeaways

A stop-payment order is valid only if the bank receives it before payment/certification; it does not settle the underlying debt.
Banks do not partially pay checks; partial payments are between parties, with rights on the unpaid balance preserved.
BP 22 liability is avoided by full payment within 5 banking days after written notice of dishonor; partial payment won’t do.
Using a check to induce a transaction that later bounces can trigger estafa on top of civil liability.
For high-value items, prefer manager’s/cashier’s checks or escrow; for staged deals, split into multiple checks rather than rely on stops or amendments.

If you tell me your scenario (why you want to stop payment, amounts, dates, and what’s already happened), I can draft a tailored demand/response letter set and a risk map (civil vs. BP 22 vs. estafa) specific to your facts.