CERTIFIED CHEQUE, a cheque regularly drawn against a depositor's account in a bank but having stamped or written on the face the word "certified" or "accepted," or the phrase "good when properly indorsed," or "good through clearing house," or some other expression commonly used, and the signature of a bank official, usually a cashier or paying teller, qualified to make certifications. The certification is the bank's guarantee that the signature of the drawer is genuine and that there are and will be sufficient funds to his credit to pay the cheque. A certified cheque becomes an obligation of the bank itself instead of merely an order upon the bank by the drawer. Immediately upon the certification of a cheque, the amount certified is set aside from the drawer's account specially for the purpose of paying the cheque ; and other cheques which may be presented ahead of that certified will not be allowed to withdraw the funds so segregated. The advantage of the certified cheque is that it will not be refused payment on the ground of "no funds," or "not sufficient funds." A cheque may be certified at the request of either the drawer or a holder. If certified at the request of a holder, however, both the drawer and the indorsers, if any, are released from obligation and the holder must look for payment to the bank alone, and the bank is absolutely liable unless the cheque was "raised," either before or after the certification. When a bank certifies a cheque at the request of the drawer, the latter is not released from liability, and if the bank should fail before the cheque is presented for payment, the holder will have recourse against the drawer.
(J. H. B.)