Article 94 of the Saudi Commercial Papers Law
المادة 94 من نظام الأوراق التجارية · الفصل الأول: إنشاء الشيك
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.
Official text (Arabic)
This article has not been amended since the law was issued.
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 بسحبه لحسابه أن يؤدى مقابل وفائه، ومع ذلك يظل الساحب لحساب غيره مسئولا شخصيا تجاه المظهرين والحامل دون غيرهم. وعلى الساحب دون غيره في حالة الإنكار أن يثبت أن من سحب عليه الشيك كان لديه مقابل وفائه وقت إنشائه، فإذا لم يثبت ذلك كان ضامنا وفاءه ولو عمل الاحتجاج بعد مواعيد معينة، ولا يترتب على عدم وجود مقابل الوفاء أو عدم كفايته بطلان الشيك.
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 deals with cover (the funds the drawer must have with the drawee from which the value of the check is paid). It provides the following rules:
- Condition for issue: a check may not be issued unless the drawer has, at the time the check is issued, funds with the drawee that the drawer can dispose of by check, under an express or implied agreement.
- Who is responsible for cover: the drawer of the check, or the person who ordered another to draw it on his account. However, a person who draws a check on the account of another remains personally liable toward the endorsers and the holder, and no one else.
- Burden of proof: if the existence of cover is denied, the drawer alone must prove that the drawee had cover at the time the check was issued. If the drawer does not prove it, the drawer is guarantor of payment of the check even if the protest was made after certain periods.
- Validity of the check: the absence or insufficiency of cover does not make the check void.
The last rule matters for the holder: a check that lacks sufficient funds remains a valid check, and the drawer remains liable on it. This is linked to Article 93, which requires a check to be drawn on a bank, and to Article 95, which explains to whom payment of a check may be stipulated.
Anyone facing a dispute over the existence or sufficiency of funds would do well to consult a lawyer who specializes in commercial matters and commercial papers.
Practical example
A company in Riyadh issued a check to a supplier for SAR 80,000, and when the supplier presented it to the bank, it found insufficient funds. Under this Article, the check is not void for insufficient funds, and if the company denies the existence of cover, the drawer company must prove that it existed at the time the check was issued.
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 Papers Law
Is a check void if there are no funds?
No. The Article provides that the absence or insufficiency of cover does not make the check void.
Who must prove that the check had funds?
The drawer alone. If cover is denied, the drawer must prove that the drawee had cover at the time the check was issued; otherwise the drawer is guarantor of its payment.
Is a person who draws a check on the account of another liable?
Yes. That person remains personally liable toward the endorsers and the holder, and no one else.
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 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
- Article 97
The Article makes the drawer of a check guarantor of its payment, and treats any clause by which the drawer exempts himself from this guarantee as if it had not been written.
يضمن الساحب وفاء الشيك، وكل شرط يعفي الساحب نفسه من هذا الضمان يعتبر كأن لم يكن.
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.