Article 604 of the Saudi Civil Transactions Law
المادة 604 من نظام المعاملات المدنية · الفرع الثالث: انتهاء عقد الكفالة
If the creditor accepts something else in place of the debt the surety is discharged, even if that thing is later claimed by its true owner.
Official text (Arabic)
This article has not been amended since the law was issued.
إذا قبل الدائن أن يستوفي في مقابل الدين شيئًا آخر برئت ذمة الكفيل ولو استحق هذا الشيء.
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 604 explained in plain English
This article deals with one way in which suretyship ends: where the creditor accepts collecting his right by something other than the debt itself, for example the debt is a cash sum and he accepts in its place a car, goods or real estate.
The rule is that the surety is discharged as soon as the creditor accepts this substitute. The surety remains discharged even if this thing is claimed by its true owner, that is, even if it later turns out that the thing belongs to someone other than the person who provided it and it is taken from the creditor.
This means that when the creditor accepts a substitute for the debt, he bears the risk of this choice in his relationship with the surety; he does not return to the surety if that thing is not secured to him. The article does not deal with what the creditor has against the debtor in this case, so its rule is limited to the surety's discharge.
This article is linked to Article 603, which provides that the surety is discharged when the debtor is discharged, and to Article 605, which deals with the discharge of the surety and the debtor by transfer (hawala). Anyone in a similar position, creditor or surety, would do best to consult a lawyer who specializes in civil cases before accepting a substitute for the debt.
Practical example
A merchant in Makkah had a cash debt owed by a customer, for whom Saleh stood surety. The merchant agreed with the customer to take a car in place of the debt, and it then turned out that the car belonged to someone else, who recovered it. The merchant is not entitled to claim against Saleh, because he was discharged when the merchant accepted the car in place of the debt.
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 604 of the Saudi Civil Transactions Law
If the creditor accepts something in place of the debt, does the surety remain bound?
No. The article provides that the surety is discharged if the creditor accepts collecting something else in place of the debt.
What if it turns out that the thing provided belongs to someone other than the debtor?
The surety remains discharged even if the thing is claimed by its true owner, according to the text of the article.
More articles on Suretyship
- Article 222
The Article provides that solidarity among debtors is not presumed and arises only by agreement or legal provision.
لا يكون التضامن بين المدينين إلا باتفاق أو بنص نظامي.
- Article 578
The article defines suretyship as a contract in which the surety undertakes to the creditor to perform an obligation owed by the debtor if the debtor himself does not perform it.
الكفالة عقدٌ يلتزم بمقتضاه الكفيل للدائن بأن يفي بالتزام على المدين إذا لم يَفِ به المدين نفسه.
- Article 579
Suretyship is concluded between the surety and the creditor, the creditor's silence counts as acceptance, and it does not depend on the debtor's acceptance, so it is valid without his knowledge and despite his objection.
1- تنعقد الكفالة بين الكفيل والدائن، ويعد سكوت الدائن إذا وجه إليه الإيجاب قبولًا للكفالة. 2- لا يتوقف انعقاد الكفالة على قبول المدين، وتجوز دون علمه، وتجوز أيض
- Article 580
The article requires the surety to have full capacity, limits a suretyship by a person on his deathbed to one third of the estate unless the heirs approve, and a suretyship to or for an heir takes effect only with their approval.
1- يجب في عقد الكفالة أن يكون الكفيل كامل الأهلية. 2- الكفالة من المريض مرض الموت لا تنفذ في حق الورثة فيما زاد على (ثلث) التركة إلا بإجازتهم، وإذا كانت الكفالة
- Article 581
The article provides that suretyship is valid only if the obligation guaranteed is valid.
لا تكون الكفالة صحيحة إلا إذا كان الالتزام المكفول به صحيحًا.
- Article 582
The article allows suretyship to be immediate, conditional, for a limited period, or deferred to a term.
يصح أن تكون الكفالة منجزةً أو معلقةً على شرط أو مؤقتةً أو مضافةً إلى أجل.
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.