Doctrine

An “ON-US check” refers to a client’s check drawn and deposited on the same branch of a bank. Once an ON-US check is cleared and credited to a payee’s account, the bank can no longer enforce a stop payment order and debit the payee’s account. When the late stop payment order is enforced and the payee’s account is debited, resulting in the dishonor of the check drawn from such account, the bank is deemed to have committed a breach of contract which makes it liable for damages.