Article 108 of the Saudi Commercial Papers Law
المادة 108 من نظام الأوراق التجارية · الفصل السادس: الامتناع عن الوفاء
The Article gives the holder of a check the right of recourse against those liable, jointly or individually, if the check was presented on time and not paid and the refusal is proved by protest or by a statement from the drawee or a clearing house.
Official text (Arabic)
This article has not been amended since the law was issued.
لحامل الشيك الرجوع على الملتزمين به مجتمعين أو منفردين إذا قدمه في الميعاد النظامي ولم تدفع قيمته، وأثبت الامتناع باحتجاج. ويجوز عوضا عن الاحتجاج إثبات الامتناع عن الدفع.
أ - بيان صادر من المسحوب عليه مع ذكر يوم تقديم الشيك.
ب - بيان صادر من غرفة مقاصة معترف بها يذكر فيه أن الشيك قدم في الميعاد القانوني ولم تدفع قيمته.
ويجب أن يكون البيان في الحالتين المذكورتين مؤرخا ومكتوبا على الشيك ذاته وموقعا ممن صدر منه، ولا يجوز الامتناع عن وضع هذا البيان على الشيك إذا طلب الحامل ولو تضمن الشيك شرط الرجوع بلا مصروفات، وإنما يجوز للملتزم بوصفه طلب مهلة لا تجاوز يوم العمل التالي لتقديم الشيك ولو قدم في اليوم الأخير من ميعاد التقديم.
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 108 explained in plain English
This Article regulates the check holder's right of recourse against those liable on it if the value of the check is not paid.
The conditions for recourse according to the text:
- The holder presents the check within the legal period.
- Its value is not paid.
- The holder proves the refusal to pay by protest.
When these are met, the holder may have recourse against those liable jointly or individually.
Instead of a protest, the refusal to pay may be proved in one of two ways:
- A statement issued by the drawee stating the day on which the check was presented.
- A statement issued by a recognized clearing house stating that the check was presented within the legal period and its value was not paid.
In both cases, the statement must be dated, written on the check itself and signed by the person who issued it. A person may not refuse to make this statement if the holder requests it, even if the check contains a clause of recourse without expenses. However, the person obliged to make it may ask for a delay not exceeding the working day following presentment of the check, even if it was presented on the last day of the presentment period.
Article 109 completes this rule by setting the time for proving the refusal. Anyone whose check has been returned and who wants recourse against those liable would do well to consult a lawyer who specializes in commercial matters and commercial papers.
Practical example
Mohammed presented a check to the bank in Riyadh within the period, and it was not paid for insufficient funds. Mohammed asked the bank to write on the check itself a dated and signed statement stating the day of presentment; the bank may not refuse this, though it may ask for a delay until the next working day. With this statement, Mohammed may have recourse against the drawer and the endorsers, jointly or individually.
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 108 of the Saudi Commercial Papers Law
How do I prove that the bank refused to pay the check?
By protest, or by a statement from the drawee stating the day of presentment, or by a statement from a recognized clearing house; in either case the statement must be dated, written on the check itself and signed by the person who issued it.
May the bank refuse to write a non-payment statement on the check?
A person may not refuse to make the statement if the holder requests it, but may ask for a delay not exceeding the working day following presentment of the check.
Must all the signatories of the check be claimed against together?
No. The holder may have recourse against those liable jointly or individually.
More articles on The Check
- Article 91
The Article lists the mandatory particulars of a check: the word check, an unconditional order to pay a fixed sum, the drawee's name, place of payment, date and place of issue, and the drawer's signature.
يشتمل الشيك على البيانات الآتية: أ - كلمة (شيك) مكتوبة في متن الصك باللغة التي كتب بها. ب - أمر غير معلق على شرط بوفاء مبلغ معين من النقود. جـ - اسم من يلزمه ال
- Article 92
The Article provides that an instrument lacking a check particular listed in Article 91 is not a check, unless the missing particular is the place of payment or the place of issue.
الصك الخالي من أحد البيانات المذكورة في المادة السابقة لا يعتبر شيكا إلا في الحالتين الآتيتين: أ - إذا خلا الشيك من بيان مكان وفائه اعتبر مستحق الوفاء في المكان
- Article 93
The Article requires checks issued in the Kingdom and payable there to be drawn on a bank, and treats instruments drawn on anyone other than a bank as invalid checks.
لا يجوز سحب الشيكات الصادرة في المملكة والمستحقة الوفاء فيها إلا على بنك، والصكوك المسحوبة في صورة شيكات على غير بنك لا تعتبر شيكات صحيحة.
- Article 94
The Article bars issuing a check unless the drawer has funds with the drawee that can be disposed of by check at the time of issue, and requires the drawer to prove cover if denied; lack of cover does not void the check.
لا يجوز إصدار شيك ما لم يكن للساحب لدى المسحوب عليه وقت إنشاء الشيك نقود يستطيع التصرف فيها بموجب شيك طبقا لاتفاق صريح أو ضمني. وعلى ساحب الشيك أو الآمر غيره بس
- Article 95
The Article allows a check to be payable to a named person with or without an order clause, to a named person with a not-to-order clause, or to bearer, and sets when a check counts as a bearer check.
يجوز اشتراط وفاء الشيك إلى: أ - شخص معين مع النص صراحة على شرط الأمر أو بدونه. ب - شخص معين مع ذكر شرط (ليس لأمر) أو أية عبارة أخرى تفيد هذا المعنى. جـ - حامل ا
- Article 96
The Article allows a check to be drawn to the drawer's own order or for another person's account, and bars drawing it on the drawer himself except between branches of one bank, provided it is not a bearer check.
يجوز سحب الشيك لأمر الساحب نفسه، ويجوز سحبه لحساب شخص آخر، ولا يجوز سحبه على الساحب نفسه ما لم يكن مسحوبا بين فروع بنك يسيطر عليه مركز رئيسي واحد ويشترط ألا يكو
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.