N.Y. General Obligations Law Section 5-328
Processing fee by holder of dishonored check


1.

As used in this section the following terms shall have the following meanings:

(a)

“Holder of a check” means the holder or its assignee, representative or any other person retained by the holder to seek collection of the face value of a dishonored check.

(b)

“Dishonored check” means a check, draft or like instrument drawn on a bank or depository institution as full or partial payment for an unpaid balance on an account, or for other extensions of credit or payments of money in connection with a consumer transaction, which is not paid or is dishonored or is returned by such institution due to insufficient funds or other cause not attributable to the holder.

(c)

“Consumer transaction” means a transaction in which a natural person is extended credit for, or purchases or leases, personal property, money or services primarily for personal, family or household purposes.

(d)

“Account” means a loan account, a retail credit account or an obligation under a retail lease agreement, retail instalment contract or retail instalment obligation or a retail instalment credit agreement, as defined in sections three hundred one, three hundred thirty-one and four hundred one of the personal property law.

2.

Notwithstanding the provisions of any law:

(a)

The holder of a dishonored check given in payment for a consumer transaction or an account may collect from, charge, or add to the outstanding balance of the account of, the person from whom such check was received or to whom such credit was extended, a dishonored check charge of not more than the lesser of the amount agreed upon, if contracted for, or twenty dollars.

(b)

A dishonored check charge shall not be deemed a credit service charge, interest or an incident to or a condition to the extension of credit, for any purpose of law.

3.

Notwithstanding any other provision of law, any person to whom a check, draft or like instrument, other than a money order, bank cashier’s check or certified check, is tendered for any transaction, other than a consumer transaction, may, if such instrument is dishonored charge or collect from the maker or drawer the amount of twenty dollars for the return of such unpaid or dishonored instrument.

Source: Section 5-328 — Processing fee by holder of dishonored check, https://www.­nysenate.­gov/legislation/laws/GOB/5-328 (updated Sep. 22, 2014; accessed Jun. 22, 2024).

5‑301
Certain employment contracts void
5‑311
Certain agreements between husband and wife void
5‑321
Agreements exempting lessors from liability for negligence void and unenforceable
5‑322
Agreements exempting caterers and catering establishments from liability for negligence void and unenforceable
5‑322.1
Agreements exempting owners and contractors from liability for negligence void and unenforceable
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Contents of certain construction contracts
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Payment bonds to be filed
5‑323
Agreements exempting building service or maintenance contractors from liability for negligence void and unenforceable
5‑324
Agreements by owners, contractors, subcontractors or suppliers to indemnify architects, engineers and surveyors from liability caused by ...
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Garages and parking places
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Agreements exempting pools, gymnasiums, places of public amusement or recreation and similar establishments from liability for negligence...
5‑327
Consumers’ right to recover attorney’s fees in actions arising out of consumer contracts
5‑328
Processing fee by holder of dishonored check
5‑331
Certain covenants and restrictions in conveyances and other agreements affecting real property void as against public policy
5‑332
Unsolicited and voluntarily sent merchandise deemed unconditional gift
5‑333
Validity of oil, gas or mineral land leases
5‑334
Option or right to acquire interest in property
5‑335
Limitation of reimbursement and subrogation claims in personal injury and wrongful death actions
5‑336
Nondisclosure agreements
5‑337
Agreements requiring contractees to waive their rights in relation to expressing certain opinions about contractors void and unenforceable

Accessed:
Jun. 22, 2024

Last modified:
Sep. 22, 2014

§ 5-328’s source at nysenate​.gov

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