Article 94 of the Saudi Commercial Court Law
المادة 94 من النظام التجاري نظام المحكمة التجارية · الفصل السابع: في تحويل السفاتج المعبر عنه بالجيرو
The article restores to the bill holder the right to claim against the drawer and endorsers if funds set aside for paying its value reach one of them after the time limits, so his suit is heard against whoever received them.
Official text (Arabic)
This article has not been amended since the law was issued.
يعود لحامل السفتجة الحق في مطالبة الساحب والمحيلين إذا وصلت لأحدهما بعد مضي المواعيد المقررة السالفة الذكر المبالغ التي كانت معينة لوفاء قيمة السفتجة سواء كان وصولها بواسطة حساب أو بطرق المقاصة أو بوجه آخر فتسمع دعواه على من وصلت إليه حينئذ.
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 94 explained in plain English
This article sets an exception to the loss of the right through missed time limits. As a rule, missing the prescribed time limits cuts off the holder's right, but this article restores the right in a specific case:
- If the drawer or one of the endorsers has received,
- after the prescribed time limits mentioned above have passed,
- the sums that were set aside for paying the value of the bill,
- whether they reached him through an account, by way of set-off, or in any other way.
The effect: the right to claim returns to the holder of the bill, and his suit is heard against whoever those sums reached.
The reason is plain: the drawer or an endorser may not keep the sums earmarked for payment and then plead against the holder that the time limits were missed. Whoever received these sums has been enriched at the holder's expense.
Note that the suit is heard against the one to whom the sums reached, not against all those liable.
Before it, Article 93 provides that there is no recourse against the drawer if it is proven that he had funds to cover payment with the drawee at maturity. Article 95 follows, giving the holder the right of precautionary attachment after giving notice of non-payment.
If you learn that the amount of your bill reached one of those liable after the time limits passed, consult a lawyer who specializes in commercial paper.
Practical example
A bill holder in Riyadh missed the time limit for giving notice, and it then emerges that the drawee transferred the bill's amount to the drawer by set-off in an account between them. Under this article the holder's right returns, and his suit is heard against the drawer to whom the sums reached.
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 94 of the Saudi Commercial Court Law
Does my right on the bill return after time limits are missed?
Yes. If the sums set aside for paying the bill's value reach the drawer or one of the endorsers after the time limits, your suit is heard against whoever received them.
Must the sums have been received in cash?
No. Whether they reached him through an account, by way of set-off, or in any other way.
More articles on Endorsement, Payment and Recourse on the Draft
- Article 51
The article makes the drawer of a bill of exchange and the endorsers who transferred it jointly liable for its acceptance and for payment on time, and jointly bound to pay its holder.
صاحب السفتجة والمحيلون المتناقلون لها مسئولون على وجه التضامن عن القبول والدفع في ميعاده وملزمون لحاملها بالوفاء على وجه التضامن
- Article 57
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.
لا يجب على المتوسط المذكور دفع قيمة السفتجة في ميعاد استحقاق الدفع إلا بعد عمل الإخطار بعدم الدفع في الميعاد المحدود .
- Article 60
The article provides that ownership of bills of exchange passes from one person to another by transferring them by endorsement on them.
تنتقل ملكية السفاتج من واحد لآخر بتحويلها شرحا عليها .
- Article 61
The article sets the particulars of a bill's transfer: the date, a statement that value has been received, the name and surname of the person to whose order it passes, and the endorser's signature or seal.
يؤرخ تحويل السفتجة ويذكر فيها أن قيمتها وصلت ويبين فيها اسم وشهرة من انتقلت تحت إذنه ويضع المحيل إمضاءه أو ختمه .
- Article 62
The article provides that a transfer of a bill of exchange that does not meet the conditions of Article 61 does not pass ownership but counts as an ordinary authorization to collect its value.
إذا لم يستوف تحويل السفتجة شرائطه المبينة في المادة السابقة فلا يوجب انتقال الملك بل يعد توكيلا اعتياديا في قبض قيمتها .
- Article 63
The article prohibits putting dates in transfers ahead of their true date, and treats that as forgery if it occurs.
تقديم التواريخ في التحاويل عن تاريخها الحقيقي ممنوع وإن حصل يعد ذلك تزويرا .
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.