Personal Criminal Liability in Cyprus when Issuing a Cheque on Behalf of the Company
A bouncing cheque (see Art. 305A Criminal Code - Chapter 154) is an offence of strict liability for its issuer.
Therefore, the prosecutor needs to prove only the below elements (actus reus):
(1) The issuing of a cheque;
(2) That the cheque was presented, on or after its due date, at the relevant Bank;
(3) The non-payment of the cheque due to lack of available funds of the issuer or due to the fact that the issuer's account was closed at the time of presentation;
(4) The non-payment of the cheque for a period of 15 days of its first presentation.
When it comes to a bouncing cheque issued by a company, then the signatory of the cheque (most probably its Director) could be liable as an accomplice to the offence of Art. 305A, according to Art. 20 (c) of the Criminal Code.
However, the actus reus of an accomplice includes: a) assistance or motivation b) to an offense; mens rea (guilty mind) is expected to be related to both elements (see Pavlopoulos V. Skopy Show Factory (2003) 2 CLR 261).
In Johnson v. Youden  1 K.B. 455 it was stated that “before a person can be convicted of aiding and abetting the commission of an offence, he must at least know the essential matters which constitute that offence", and also in National Coal Board v. Gamble  1 K.B. 11 it was stated that “… aiding and abetting is a crime that requires proof of mens rea, that is to say, of intention to aid as well as of knowledge of the circumstances").
Given the above, difficulties arise when it comes to evidencing that the signatory of a company’s cheque, provided aid to the commission of a crime, especially when it comes to large companies with accounting departments, CFOs and postdated cheques.
Firstly, in order to prove that the signatory had the needed mens rea, when executing the cheque on behalf of the company, the prosecution needs to prove the time of the signing. Only when the time of the signing is known, the prosecution can provide evidence proving, that at the time of the signing of the cheque, the signatory knew or owed to had known that the cheque would bounce.
“A requirement of knowledge is sometimes held to be satisfied by proof of "wilful blindness" as where "the defendant had deliberately shut his eyes to the obvious or refrained from inquiry because he suspected the truth but did not want to have his suspicion confirmed" (Westminster City Council v. Croyalgrange  2 All E.R. 353 at p. 359 (H.L.) (see HENRY HARRY HODFIELD V. Customs Department (2002) 2 CLR 414).
According to the above, the willful blindness of a defendant, i.e. when he is willfully shutting his eyes to the obvious, then such behavior is not excusable and is criminally liable.
In a very recent and interesting case (see Ioannide V. Gastop Boutique Ltd a.a. 161/2014, 30/6/2017) it was stated that: “… it does not seem necessary to prove the intention on the part of the accomplice to commit the principal offense” ... “It is sufficient, in our judgment, if the accomplice knew the facts constituting the principal offense of issuing a bouncing cheque and was indifferent or reckless with regard to whether the cheque would be paid when it was presented to the Bank for payment.” … “Therefore, neither the non-involvement of the respondent 2 in the company's daily financial statements nor the promise, general and vague, of her husband, that he would deposit the money he would receive from a court case, on the account of the company from which the cheque was issued, could be a defense for the respondent 2 …”
In Smith and Hogan’s Criminal Law it is stated that the Primary meaning of “wilful” is “deliberate” but it may also include recklessness, as accepted by the majority of the House of Lords in Sheppard (1981 AC 394). It is also said that a person who does not intend to cause a harmful result may take an unjustified risk of causing it. If he does so, he may be held to be reckless.
The content of this article is intended to provide a general guide to the subject matter. Specialist advise should be sought about your specific circumstances.
AUTHOR: Mr. Antonis Alexopoulos
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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.