Article 57 of the Saudi Commercial Court Law
المادة 57 من النظام التجاري نظام المحكمة التجارية · الفصل السادس: في السفاتج ، سندات الحوالة المعبر عنها بالبوليسة والكمبيالة المتداولة بين التجار
The article provides that the intervener is not bound to pay the bill's value on the due date except after notice of non-payment has been given within the set time.
Official text (Arabic)
This article has not been amended since the law was issued.
لا يجب على المتوسط المذكور دفع قيمة السفتجة في ميعاد استحقاق الدفع إلا بعد عمل الإخطار بعدم الدفع في الميعاد المحدود .
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 57 explained in plain English
This article specifies when the intervener becomes bound to pay. The intervener, who accepted the bill of exchange on behalf of the drawer or one of the endorsers after notice of non-acceptance, does not automatically take the drawee's place in paying.
The ruling as it appears:
- The intervener is not bound to pay the value of the bill on its due date,
- except after notice of non-payment has been given,
- within the set time.
The expected steps are therefore: the bill is presented for payment on the due date; if it is not paid, notice of non-payment is given within its time; and then the intervener must pay. If the notice is not given, the text does not require the intervener to pay.
This article comes after Article 56, which provides that all the holder's rights against the drawer and the endorsers are preserved because of the drawee's non-acceptance, even if acceptance came from an intervener. The holder is thus protected on both sides, but must observe the procedures.
The article does not state the length of the "set time" for the notice. Because missing the notice may affect whether the intervener is bound, it is advisable to consult a lawyer specializing in commercial paper.
Practical example
An intervener accepted a bill held by a merchant in Riyadh. On the due date the amount was not paid, so the merchant gave notice of non-payment within the set time. At that point the intervener had to pay the value of the bill under this article.
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 57 of the Saudi Commercial Court Law
When is the intervener bound to pay the value of a bill of exchange?
The intervener is not bound to pay on the due date except after notice of non-payment has been given within the set time.
Does the intervener pay automatically when the due date arrives?
No. The text requires that notice of non-payment be given first.
More articles on The Draft and Bill of Exchange and Acceptance
- Article 42
The article sets the details required in a bill of exchange (safta): date, amount, drawee's name, date and place of payment, reason for the value and its receipt, and drawer's signature, and the rule for multiple copies.
سندات الحوالة أي السفاتج التي تسحب من محل على آخر يجب أن تؤرخ ويوضح فيها المبالغ المحولة واسم الشخص المحال عليه وتاريخ ومكان الدفع ويبين فيها أنها قيمة بضاعة أو
- Article 43
The article allows a bill of exchange to be drawn on one person with a condition that it be paid at the place of another person, and also allows it to be drawn at the order of a person on his account.
يجوز أن تسحب السفاتج على شخص ويشترط فيها الدفع في محل شخص آخر كما يجوز سحبها بأمر شخص على ذمته
- Article 44
The article provides that bills of exchange drawn contrary to the preceding conditions are considered only ordinary instruments.
السفاتج المحررة على خلاف الشروط الآنفة الذكر لا تعتبر إلا كسندات عادية .
- Article 45
The article requires that, when the payment date falls due, the drawee owe the transferor or the person who ordered the drawing an amount not less than the value of the bill.
عند حلول أجل دفع قيمة السفاتج يجب أن يكون في ذمة المحال عليه للمحيل أو للآمر بالسحب مبلغ لا يقل عن قيمة السفتجة .
- Article 46
The article makes acceptance sufficient proof that the acceptor owes the funds covering payment, and requires the drawer to prove the existence of the cover if it is denied, failing which the drawer guarantees the bill's value to the holder.
الشرح على السفتجة بالقبول دليل كاف على أن القابل مدين للساحب أو الآمر بالسحب بما يقابل الوفاء وعلى الساحب وحده أن يثبت في حالة الإنكار أو الامتناع عن الدفع بعد
- Article 47
The article regulates the holder's right to the cover for payment when the drawer goes bankrupt after acceptance, and when the drawee goes bankrupt after accepting, depending on the nature of the cover.
إذا أفلس الساحب بعد قبول المحال عليه ولو قبل حلول أجل الدفع فلحامل السفتجة دون غيره من غرماء الساحب الحق في استلام مقابل الوفاء الذي عند المسحوب عليه وإذا أفلس
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.