To further protect yourself, demand that the check contain as much information about what is being paid for with this specific instrument.  For example, in the memo line, list the specific invoice that is being paid with this check.  If multiple invoices are being paid with one check, list all invoices being satisfied with this check.  The individual/business who bounces a check is also likely to later allege that previously or subsequently tendered checks (which did clear the bank) were intended to satisfy the invoices at issue on the NSF check. 

Governing Law for NSF Checks

Once a creditor is confronted with an NSF check from a debtor, regardless of the underlying debt, the individual whom signed the check is now potentially liable for the amount of the check, statutory damages and attorney's fees.  The case law is clear on this issue with the conclusion being: "A person violates the bad check statute if, with intent to defraud and with intent to obtain control over property or to pay for property of another, he issues or delivers a non-sufficient funds check. Ill. Rev. Stat. ch. 38, para. 17-1 (1987). Nowhere does the statute require that the "person" acquire the property "for his own use."

The Illinois Statute governing NSF checks is: § 720 ILCS 5/17-1.  It is commonly known as the Deceptive Practices Act.  Section B of this statute specifically refers to NSF check.  The pertinent part of Section B reads: "A person commits a deceptive practice when: 

(1) With intent to obtain control over property or to pay for property, labor or services of another, he or she issues or delivers a check or other order upon a real or fictitious depository for the payment of money, knowing that it will not be paid by the depository. The trier of fact may infer that the defendant knows that the check or other order will not be paid by the depository and that the defendant has acted with intent to defraud when the defendant fails to have sufficient funds or credit with the depository when the check or other order is issued or delivered, or when such check or other order is presented for payment and dishonored on each of 2 occasions at least 7 days apart;  

(2) He or she issues or delivers a check or other order upon a real or fictitious depository in an amount exceeding $ 150 in payment of an amount owed on any credit transaction for property, labor or services, or in payment of the entire amount owed on any credit transaction for property, labor or services, knowing that it will not be paid by the depository, and thereafter fails to provide funds or credit with the depository in the face amount of the check or order within 7 days of receiving actual notice from the depository or payee of the dishonor of the check or order.

Importantly, the case law presumes that a debtor has, or should have, the knowledge of what funds are in its account.  So, the burden for "intent" shifts to the debtor who must present evidence showing that the NSF check was not tendered with the intent to defraud. 

Debtor's Liability for NSF Check (Creditor's Recovery)

Taken directly from the Deceptive Practices statute, "A person who issues a check or order to a payee in violation of paragraph 

(B)(1) and who fails to pay the amount of the check or order to the payee within 30 days following either delivery and acceptance by the addressee of a written demand both by certified mail and by first class mail to the person's last known address or attempted delivery of a written demand sent both by certified mail and by first class mail to the person's last known address and the demand by certified mail is returned to the sender with a notation that delivery was refused or unclaimed shall be liable to the payee or a person subrogated to the rights of the payee for, in addition to the amount owing upon such check or order, damages of treble the amount so owing, but in no case less than $ 100 nor more than $1,500, plus attorney's fees and court costs. An action under this subsection 

(E) may be brought in small claims court or in any other appropriate court. As part of the written demand required by this subsection 

(E) the plaintiff shall provide written notice to the defendant of the fact that prior to the hearing of any action under this subsection 

(E) the defendant may tender to the plaintiff and the plaintiff shall accept, as satisfaction of the claim, an amount of money equal to the sum of the amount of the check and the incurred court costs, including the cost of service of process, and attorney's fees.

Final Recommendations

A common hurdle creditors run in to when dealing with collection arises when a corporate entity is liable for the underlying debt the creditor is attempting to collect.  Corporations dissolve, voluntarily and involuntarily often, many times to avoid creditors.  Further, the principals of these corporations funnel the monies/assets out of the corporation long before the creditor can enforce a judgment.  The easiest solution to this problem would be simply getting a "personal guaranty" on any agreement made.  However, avoiding a personal guaranty is exactly why the principal set up the corporation in the first place. 

So, once a check is tendered by a principal, or other individual, the signor is now potentially putting themselves on the line for the debt.  This is why it is important to get all information on the signor of the check.  If that check is returned NSF, the creditor can now pursue not only the corporation, but the individual as well.  While no creditor wants to see a check returned NSF, it sometimes can lead to greater collection in the end, so long as all measures are taken to gain knowledge on that individual.