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Blank cheque

A blank cheque (blank check, carte blanche), in the literal sense, is a cheque that has no numerical value written in, but is already signed. In the figurative or metaphoric sense, it is used (especially in politics) to describe a situation in which an agreement has been made that is open-ended or vague, and therefore subject to abuse, or in which a party is willing to consider any expense in the pursuance of their goals.


Literal meaning

Cheque users are normally advised to specify the amount of the cheque before signing it. If created accidentally, a blank cheque can be extremely dangerous for its owner, because whoever obtains the cheque could write in any amount of money, and would be able to cash it (to the extent that the chequeing account contains such funds, also depending on the laws in the specific country).

One might give a blank cheque to a trusted agent for the payment of a debt where the writer of the cheque does not know the amount required, and it is not convenient or possible for the writer to enter the amount when it becomes known. In many cases, it is possible to annotate a cheque with a notional limit with a statement such as "amount not to exceed $1000". In theory, the bank should refuse to process a cheque in excess of the stated amount.

The "formal" American legal term for a blank cheque is an rather, a blank cheque is an example of an incomplete instrument, which more generally is any incomplete signed writing and these are covered in the Uniform Commercial Code's Article 3, Section 115.[1] Filling in an amount into a blank cheque, without the authority of the signer, is an alteration (covered in Article 3, Section 407), and is legally equivalent to changing the numbers on a completed (non-blank) cheque, namely that the cheque writer is not liable for the cheque. However, the cheque writer has the burden of proving that the alteration was not authorized.[2]

Counter cheque

Blank cheque was also commonly used as a synonym for counter cheque. Before the Federal Reserve established regulations in 1967[3] requiring that cheques be MICR encoded in order to be handled by their clearing houses, it was fairly common for banks, especially in small towns, to issue cheque to customers which were not personalized other than the name of the bank.

Businesses would have pads of counter cheques which did not even have the bank specified on them - the customer had to not only fill in the value of the cheque, the date, and their signature, but also had to designate the bank on which funds were to be drawn.

Metaphoric meaning

The metaphor of the "blank cheque" is thus often used in politics. For example, in the United States, the Gulf of Tonkin Resolution has been called a blank cheque as it gave the President, Lyndon B. Johnson, the power to "take all necessary measures" to prevent "aggression" in Southeast Asia. These powers were then used to escalate the Vietnam War. Many in the United States Congress protested, but were helpless to effect change, for the Tonkin resolution's terms were too subjective to enforce.

This term was also used to describe how the Kaiser of Germany (Kaiser Wilhelm II) told Austria-Hungary officials that they could deal with Serbia however they wanted after Serbian Nationalists assassinated the heir to the throne of Austria-Hungary, Archduke Franz Ferdinand. This immediately preceded World War I.

An example of the second metaphorical usage can be seen in a BBC News article, in which Gordon Brown, the then Chancellor of the Exchequer, offered a 'blank cheque', and would thus '"spend what it takes" to tackle Iraq's weapons of mass destruction.'[4]

It may also be used in service fields. Customers may tell a company to treat the project as their own, which, in essence, is a carte blanche. (To the extent the service meets normal expectations.)

In literature

A renowned literary carte blanche (literally 'white card') was handed out by Cardinal Richelieu in Alexandre Dumas, p re's The Three Musketeers:

or in French:

Sir Arthur Conan Doyle used the term carte blanche in several of his Sherlock Holmes stories.

A Scandal in Bohemia

The Adventure of the Beryl Coronet

Blank cheque company

In economics, the term blank cheque company can refer to a company in development that has no specific business plan yet. For a fuller discussion of blank cheque companies, see Special purpose acquisition company.

See also

  • Blank endorsement
  • List of political metaphors


de:Blankoscheck es:Carta blanca

Source: Wikipedia | The above article is available under the GNU FDL. | Edit this article

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