Negotiable instruments such as cheques, bills of exchange and promissory notes offer the creditor a faster and stronger route of enforcement than general enforcement proceedings. The attachment procedure specific to negotiable instruments, governed by Enforcement and Bankruptcy Law No. 2004, gives the debtor short time limits. Correct calculation of the time limits is therefore decisive for both the creditor and the debtor.

Payment order and time limits

In enforcement proceedings based on a negotiable instrument, the payment order sent to the debtor states that:

• The debt must be paid within ten days,
• Any complaint that the instrument does not qualify as a negotiable instrument, and any objections to the debt or to the signature, must be filed with the enforcement court within five days.

Unlike in the general attachment procedure, the objection is filed not with the enforcement office but directly with the enforcement court. An objection does not automatically stay the proceedings; the enforcement court may, where the conditions are met, order a temporary stay of the proceedings.

Consequences of an objection to the signature

A debtor who claims that the signature on the instrument is not theirs must state this expressly. If the objection to the signature is dismissed, the debtor is ordered to pay a fine of ten per cent of the amount claimed in the proceedings and, at the creditor’s request, compensation of not less than twenty per cent of the claim. This sanction aims to deter objections made in order to delay the proceedings.

Presentment periods for cheques

Under Turkish Commercial Code No. 6102, a cheque must be presented to the bank within ten days if it was issued in the place of payment, within one month if the place of issue and the place of payment are different, and within three months if they are on different continents. Where a cheque is not presented in time, the holder may lose the right of recourse against the endorsers and other liable parties. Where a cheque presented in time is dishonoured for lack of funds, the bank records this on the back of the cheque.

Limitation

• Cheque: Actions of recourse by the holder against the endorsers, the drawer and other parties liable on the cheque become time-barred six months after the expiry of the presentment period.
• Promissory note and bill of exchange: Three years from maturity against the maker or the acceptor; shorter periods apply to the holder’s rights of recourse against the endorsers.

In enforcement proceedings based on negotiable instruments, the limitation objection must also be raised within the five-day period. An instrument that has lost its status as a negotiable instrument may serve as evidence as an ordinary written instrument, to be assessed separately.

Assessment

Negotiable instruments law is built on strict formal rules and short time limits, in keeping with the pace of commercial life. For the debtor, the five-day period starting on the day the payment order is served is often the only opportunity to mount a defence. For the creditor, the soundness of the proceedings depends on the instrument meeting the formal requirements and being presented in time.