Collect the Balance That You are Owed, Do Not Deposit Paid in Full Check

If You Want to Collect the Balance That You are Owed, Do Not Deposit “Paid in Full Check”


We have recently seen a trend with some of our clients who ended up in litigation after receiving a check from their clients saying “paid in full” and here is our first piece of advice: you have the right to shut up and you should exercise it. Do not assume you know what is going on and call us.

            Unfortunately, we have a history of clients coming to us after accepting checks that said, “paid in full”. In the old days, if they wrote some special wording on a check, you still reserved your rights for protection. Recent rulings have weakened that understood protection and made it so if a client writes extra wording on a check, it should no longer be trusted. When we hear an excuse about advice taken from a 1980s law class, it never comes from an attorney. An actual lawyer will be constantly updated on changes in the laws, so do not trust that one class you took back in business school and listen to the advice of a practicing lawyer.

            So, what happens when a client goes to dispute a check that says, “paid in full”? There are a few ways that you can end up in trouble once you receive that check. The first way is if you deposit the check and later try to collect. This opens you up for a countersuit file for misaction because the check has been cashed. Depending on the state there is some time allowance to cancel a check that was cashed, but the best action is to reject the check and call us to help you collect the full amount.

            The number one rule in these situations is: if they write “paid in full,” it is better not to accept. Some clients will write this on a check to make it invalid. It is slightly easier to dispute if it is written on the stub rather than written on the back and we have even seen it written on a post-it note, but in any case if someone says they are not going to pay you, exercise your right to shut up and give us a call!

            Our team of lawyers have some important advice if you find yourself in this situation: if you send an invoice and receive a partial payment that says, “paid in full,” contact the debtor and send the check back to collect the full amount. If they claim that they do not owe you any more, DO NOT CASH IT! By cashing the check, you are unlikely to ever get the remainder of the money you are owed. Clients are very good at creating layers of defense: writing “paid in full” or certified on a check, saying it over the phone, or even sending it in a letter. We have even seen cases where a client did not deposit but kept the check and their argument was overturned in litigation.

We have posted many blogs and written articles about knowing what you are signing and this is another example of why. If you are sent a partial check along with something to sign, do not touch that paper unless you know exactly what it means; otherwise you are opening yourself up to a legal disaster. You cannot file any kind of suit if you have signed a settlement. The “under duress” argument is simply not valid unless they held a gun to your head.

If you receive a “paid in full” check, contact the debtor to see if this is a mistake. If you keep the check, be aware of the possible repercussions. This is a difficult case to fight even in collections, so do not think that you can outsmart the debtor. If a debtor puts you in this situation then it is highly likely that they have done this before and are very good at it; so be smart and protect yourself by shutting up and calling us.

            Need our help? Contact Samantha Cole at and have our team of expert lawyers consult on your case.



Key Takeaways

Quote 1: The number one rule in these situations is: if they write “paid in full”, it is better not to accept.

Quote 2: If someone says they are not going to pay you, exercise your right to shut up and give us a call!

About Wilson Cole

Wilson Cole is the founder and CEO of Adams, Evens, & Ross-NC, LLC, the nation's largest credit and collection agency design exclusively for the staffing and recruiting industry. In 2008 he was inducted into INC Magazines, "INC 500" for being the CEO of Adams, Evens, & Ross-NC, LLC,, the 307th fastest growing privately held company in America. This exclusive group of other INC 500 CEOs includes Bill Gates of Microsoft and Larry Ellison of Oracle. In 2007 Recruiting & Staffing Solutions Magazine's Editorial Staff named him " The Billion Dollar Man" due to the fact that he had collected or helped his clients collect more than 1 Billion dollars in past-due debt over his career of almost 20 years as CEO of Adams, Evens, & Ross-NC, LLC,