Legal Definitions - cut a check

Cut a Check

To "cut a check" means to formally issue a payment by preparing, signing, and thereby authorizing a financial institution to disburse funds from an account to a specific recipient. It signifies the act of creating a physical check for a payment.

Here are some examples illustrating this term:

• Example 1: Business Expense

  After receiving an invoice for office supplies, the accounting department at "InnovateTech Solutions" needed to cut a check to their vendor, "Office Essentials," for the amount due. This involved an accountant filling out the check with the correct payee and amount, and then an authorized signatory signing it before mailing it out.

  This example illustrates "cutting a check" as the process a business undertakes to make a formal payment to a supplier, involving the preparation and signing of a physical check.

• Example 2: Personal Donation

  During their annual fundraising drive, the local animal shelter received a pledge from Ms. Eleanor Vance. To fulfill her promise, Ms. Vance decided to cut a check for $250, which she then mailed to the shelter's treasurer.

  Here, "cutting a check" refers to an individual preparing and signing a check from their personal bank account to make a donation, demonstrating the act of issuing a payment.

• Example 3: Legal Settlement

  Following a successful mediation, the defendant in a civil dispute agreed to pay the plaintiff a settlement amount. The defendant's attorney informed their client that they would need to cut a check for the agreed-upon sum, payable to the plaintiff's legal counsel, to finalize the settlement terms.

  This scenario shows "cutting a check" in a legal context, where a party issues a formal payment via check to satisfy a settlement agreement, highlighting the authorization and disbursement of funds.