Article 101 of the Saudi Commercial Court Law

المادة 101 من النظام التجاري نظام المحكمة التجارية · الفصل التاسع: في الرجوع

The article bars making several statements for the re-exchange account of one bill, and provides that the account is paid from endorser to endorser in sequence until the drawer finally pays it.

Official text (Arabic)

This article has not been amended since the law was issued.

لا يجوز عمل قوائم متعددة لحساب رجوع سفتجة واحدة ويدفع هذا الحساب من محيل إلى محيل بالتسلسل إلى أن يدفع أخيرا من الساحب

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 101 explained in plain English

This article sets two rules on the re-exchange account:

First: one account. Several statements may not be made for the re-exchange account of one bill. Each bill has a single re-exchange statement, and each person liable may not prepare a statement of his own adding new expenses.

Second: payment in sequence. This account is paid from endorser to endorser in sequence, until it is finally paid by the drawer.

The idea is that each endorser pays the account to the one after him, then has recourse for it against the one before him, until the final burden reaches the drawer who created the bill. A single statement prevents the amount from swelling at each stage, because several statements could mean repeated expenses.

Article 100 before it set out the content of this statement: the original bill's value, a statement of the notice expenses and other expenses caused by the original bill, with the certificate of two well-known merchants.

Article 102 follows, providing that every suit relating to bills is not heard after five years from the date of the notice of non-payment or from the day of the last hearing if no judgment was issued in it or no acknowledgment of it was made.

If you are an endorser who has been asked to pay a re-exchange account, consult a lawyer who specializes in commercial paper.

Practical example

A bill passes through three endorsers. The last endorser pays the re-exchange account to its holder, then has recourse for it against the endorser before him, and so on until the drawer finally pays it. None of them may prepare a new statement with additional expenses.

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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