Article 207 of the Saudi Civil Transactions Law
المادة 207 من نظام المعاملات المدنية · الفرع الثاني: الأجل
The article provides that a deferred debt does not fall due on the creditor's death, and falls due on the debtor's death unless it is secured by security in kind, the heirs provide adequate security, or the creditor agrees it remains deferred.
Official text (Arabic)
This article has not been amended since the law was issued.
لا يحل الدين المؤجل بموت الدائن، ويحل بموت المدين إلا إذا كان الدين موثَّقًا بضمانٍ عينيٍّ أو قدم الورثة ضمانًا كافيًا عينيًّا أو شخصيًّا أو وافق الدائن على بقاء دينه مؤجلًا.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 207 explained in plain English
This article explains the effect of death on a deferred debt, and distinguishes between the death of the creditor and the death of the debtor.
Death of the creditor: The deferred debt does not fall due on his death, so the term remains in place.
Death of the debtor: The rule is that the deferred debt falls due on his death, that is, it becomes payable at once. There are three exceptions in which the debt remains deferred:
- If the debt is secured by security in kind.
- If the heirs provide adequate security, whether in kind or personal.
- If the creditor agrees that his debt remains deferred.
This rule gives the heirs the chance to keep the term if they provide adequate security, without harming the creditor, whose right remains secured.
This article is connected with Article 206, which regulates early performance of a debt by the person for whose benefit the term was set, and with Article 208, which deals with the case where the debtor's right to the term is lost and the term turns out to have increased the amount of the debt when the contract was made, in which case the court reduces that increase.
Because matters of a deceased person's debts relate to the estate, heirs or creditors would do well to consult a lawyer specializing in civil or personal status cases.
Practical example
Abdulrahman died owing a deferred debt to a merchant due in two years, and the debt is not secured by security in kind. The rule is that the debt falls due on his death, but if his heirs provide adequate security, such as a mortgage of real estate or a guarantor, or the merchant agrees that it remains deferred, the debt remains deferred until its date.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 207 of the Saudi Civil Transactions Law
Does a deferred debt fall due on the debtor's death?
Yes, unless it is secured by security in kind, the heirs provide adequate security in kind or personal, or the creditor agrees it remains deferred.
Does a deferred debt fall due on the creditor's death?
No. The article provides that a deferred debt does not fall due on the creditor's death.
How do the heirs preserve the deferment of their predecessor's debt?
By providing adequate security, in kind or personal, or with the creditor's agreement that the debt remains deferred.
More articles on Condition, Term and Joint Liability
- Article 127
If several persons are liable for a harmful act, they are jointly liable for compensation, the court sets each one's share, and if that is not possible, liability is divided equally.
إذا تعدد المسؤولون عن فعل ضار كانوا متضامنين في التزامهم بتعويض الضرر، وتعين المحكمة نصيب كل منهم في التعويض وفق القواعد الواردة في هذا الفصل، وإذا تعذر ذلك كان
- Article 197
The article defines a conditional obligation as one whose existence or disappearance depends on a future event that may or may not occur.
يكون الالتزام معلَّقًا على شرطٍ إذا كان وجوده أو زواله مترتِّبًا على أمرٍ مستقبلٍ محتمل الوقوع.
- Article 198
The article provides that an obligation made conditional on an event that has occurred is treated as immediate, and one made conditional on something impossible has a void condition and is itself void.
إذا علق الالتزام على أمر واقع عد الالتزام ناجزًا، وإذا علق على أمر مستحيل عد الشرط باطلًا، ويبطل الالتزام الذي علق عليه.
- Article 199
The article provides that an obligation does not arise if it is made conditional on a condition whose purpose is to encourage something unlawful.
لا ينشأ الالتزام إذا عُلق على شرطٍ يكون القصد من التعليق عليه الحض على أمر غير مشروع.
- Article 200
The article provides that an obligation does not exist if it is made conditional on a suspensive condition making its existence depend on the mere will of the obligor.
لا يكون الالتزام قائمًا إذا علق على شرط واقف يجعل وجود الالتزام متوقفًا على محض إرادة الملتزم.
- Article 201
The article provides that an obligation subject to a suspensive condition is not enforceable unless the condition is fulfilled and cannot be performed before then, while the creditor may take steps to preserve his right.
لا يكون الالتزام المعلق على شرط واقف نافذًا إلا إذا تحقق الشرط المعلق عليه، ولا يكون الالتزام قبل تحقق الشرط قابلًا للتنفيذ، وللدائن أن يتخذ من الإجراءات ما يُح
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.