Payee has issued us a cheque for a duplicate payment

SOLVED

I double paid an invoice in error, and the vendor cashed the cheque before realizing it. 
I deleted the duplicate invoice, and entered the amount as a "deposit" instead of an invoice.  

This left me with a credit on their account of -430.00

They then sent us a cheque equal to the amount that was overpaid being $430.00.
I can't enter this into our system as it is a payee and not a receivable . 

I put the cheque back into our bank account. 

How do I enter a transaction for a credit when I already have this amount showing as a credit? 

If I enter this as a payment, it then doubles the credit amount on my payee account.