Definition
A memorandum check is a check given by a borrower to a lender as evidence of a short-term loan, accompanied by an express or implied agreement that the check will not be presented to the bank for payment but will instead be redeemed directly by the maker when the loan comes due. The arrangement is signaled by writing the word "Memorandum" or the abbreviation "Mem." on the face of the instrument.
The memorandum check occupies an unusual position in commercial law: it looks like a check and functions as a check, but the parties have privately agreed to suspend its ordinary operation. Despite this private understanding, courts have consistently held that the instrument retains full negotiability. A third party who acquires a memorandum check in the ordinary course of business takes it with the same rights as the holder of any other check — the "Mem." notation does not defeat the instrument's negotiable character or bar presentment by a holder in due course.
Common Language
Modern common usage (Wiktionary): No established general-English entry for "memorandum check."
Historical common usage (Webster's 1913): No dedicated entry. "Memorandum" is defined as a record made for future use; a note or reminder.
The legal term borrows the ordinary meaning of memorandum — a private note or reminder — and applies it to a specific commercial instrument. The "Mem." notation was a merchant's shorthand signaling a private arrangement, not a public limitation on the instrument. The gap that matters for researchers: what the word signaled between the original parties was legally invisible to third-party holders.
Common Confusion
The memorandum check should not be confused with a postdated check. A postdated check defers presentment by dating the instrument for a future date — that date is visible on its face and operates as a condition understood by all parties. A memorandum check carries the current date; the deferral is purely a private agreement between maker and payee, signaled only by the "Mem." notation. The legal consequences differ: a postdated check may affect a bank's liability for early payment; a memorandum check's private arrangement is simply unenforceable against a holder in due course who had no notice of it.
Why It Matters in Research
Researchers encounter the memorandum check primarily in nineteenth-century commercial law materials, where short-term merchant lending was common and informal instruments of this kind were routine. Several research traps deserve attention.
First, the term surfaces almost exclusively in older materials. Modern sources rarely use "memorandum check" as a term of art; the practice has been absorbed into general negotiable instruments doctrine without retaining the specialized label. A researcher working in contemporary commercial law should search for the underlying doctrine — negotiability, holder in due course, and the effect of restrictive notations — rather than the term itself.
Second, the negotiability question was the live issue in the historical case law. Courts repeatedly confirmed that the "Mem." notation did not render the check non-negotiable, could not bind a subsequent holder in due course, and did not relieve the maker of liability to such a holder. This line of authority feeds directly into the modern holder-in-due-course framework under the Uniform Commercial Code, making memorandum check cases useful background for understanding why the UCC treats notice and good faith as the operative tests rather than facial notations on the instrument.
Third, the instrument sits at the intersection of contract and negotiable instruments law. The private agreement between maker and payee is enforceable as a contract between those parties; it simply cannot be used to defeat the rights of a subsequent holder. Researchers tracing the boundary between personal defenses and real defenses in negotiable instruments doctrine will find memorandum check cases instructive.
Fourth, in the criminal law context, delivering a memorandum check with no intention of redeeming it could expose the maker to check fraud liability. The Check Fraud and Bank Fraud encyclopedia entry covers the modern statutory framework relevant to that analysis.
Historical Dictionary Support
All three historical dictionaries — Black's, Bouvier's, and Burrill's — are in substantive agreement on the core definition: a check given in connection with a temporary loan, bearing the "Mem." notation, with a private understanding that it will not be presented to the bank. The three sources converge on the merchant context and on the critical legal point that negotiability is unaffected by the notation.
Bouvier's contributes the most practically useful observation: if the check is passed to a third person, it is valid in that person's hands like any ordinary check. This is the point that generated litigation, and Bouvier's correct identification of it as the operative legal consequence aligns with how courts resolved the issue.
Burrill's explicitly states that the making of a check in this way "does not affect its negotiability, or alter the right of the holder to present it" — the clearest of the three formulations on that point. The Burrill's entry is unfortunately truncated in surviving sources, and the surrounding text drifts into an unrelated discussion of membrane-based records, suggesting a printing or compilation error in the historical source. Researchers relying on Burrill's should treat that entry as incomplete.
What none of the historical dictionaries address is the question of the maker's liability to the original payee if the payee breaches the private agreement by presenting the check prematurely. That contractual dimension — enforcement of the side agreement between the original parties — was a separate matter from negotiability and is underexplored in all three sources.
Jurisdictional Note
The memorandum check as a distinct term of art appeared primarily in nineteenth-century American and English commercial practice. Under modern U.S. law, the analysis is governed by Article 3 of the Uniform Commercial Code, adopted in substantially similar form across all states. The UCC framework for holder in due course and the effect of restrictive notations has largely displaced the need to invoke "memorandum check" as a separate category.
Encyclopedia Cross-Reference
Negotiable Instruments — Check 21 Act and Electronic Check Processing (The Law Mind Contracts & Commercial Law Encyclopedia): covers the modern framework for check processing and negotiability doctrine that supersedes historical memorandum check practice.
Check Fraud and Bank Fraud (The Law Mind Criminal Law Encyclopedia): relevant when analyzing whether delivery of a memorandum check with intent not to redeem it constitutes fraudulent conduct under modern statutes.