The cheque, the most frequently used type of negotiable instrument in practice, is regulated in Articles 780 to 823 of the Turkish Commercial Code No. 6102. Payment depends upon the holder presenting the instrument within the prescribed period; under Turkish law the capacity of drawee always belongs to a bank.
An instrument that is not presented within its period loses its character as a negotiable instrument. The most significant consequence of that loss is that the creditor forfeits the possibility of resorting to the enforcement procedure specific to negotiable instruments. Because unfamiliarity with the presentment periods — which are of almost vital importance — gives rise to serious difficulties in practice, this note examines the periods applicable to cheques in detail.
The Code requires the instrument to be presented to the drawee within the period; an instrument taken to the bank after the period has expired does not carry the character of a negotiable instrument.
The Concept of the Cheque and Its Legal Basis
The cheque, one of the negotiable instruments, is governed both by Articles 780 to 823 of the Turkish Commercial Code No. 6102 and by the Cheque Act. For an instrument to qualify as a cheque bearing the character of a negotiable instrument, it must carry the mandatory elements laid down in both statutes. Those conditions are addressed in detail in our note entitled Mandatory Elements a Cheque Must Contain.
The instrument was defined by the 19th Civil Chamber of the Court of Cassation in its judgment dated 12.10.2015, docket no. 2015/432, decision no. 2015/12597, as follows:
“Pursuant to Article 780 of the Turkish Commercial Code, a cheque is an order and a means of payment given for the payment of a certain sum unconditionally and without reservation…”
Presentment Periods
For payment to take place, the holder must present the instrument to the drawee. Under Article 796 of the Turkish Commercial Code No. 6102, the presentment periods are determined as follows:
- Where payment is to be made in the place where the instrument was drawn, the period is ten days.
- Where payment is to be made in a place other than the place of drawing, the period is one month.
- For instruments drawn in a country other than the country of payment, the criterion is that of the continent: if the place of drawing and the place of payment lie on the same continent, presentment to the drawee must be effected within one month; if they lie on different continents, within three months.
One exception has been made to that criterion. Instruments drawn in a European country and payable in a country bordering the Mediterranean, together with instruments drawn in a country with a Mediterranean coastline and payable in a European country, are deemed to have been drawn and made payable on the same continent. All of the periods mentioned begin to run from the day following the date of drawing shown on the instrument.
Presentment of Post-Dated Cheques
As a rule, the date of drawing written on the instrument must correspond to the date on which the instrument was in fact drawn. However, under Provisional Article 3(5) of the Cheque Act, it is possible until 31.12.2023 to insert a forward date of drawing on the instrument. That paragraph provides:
Cheque Act No. 5941, Provisional Art. 3(5)
“Until 31/12/2023, presentment of a cheque to the drawee bank for payment before the date of drawing written upon it is invalid.”
Within the framework of that provision, until 31.12.2023 the instrument may not be submitted to the drawee bank for payment, nor may a dishonour procedure be requested, before the date written on it; the date of drawing shown on the instrument must be awaited.
For more detailed information on the subject, reference may be made to our note entitled Dishonoured Cheques.
Consequences of Missing the Presentment Period
The periods laid down by the Code for presentment are preclusive in nature. If the holder fails to observe them and does not present the instrument in time, the instrument loses its character as a negotiable instrument. As a result, the instrument may no longer be endorsed, nor may it be collected by way of the enforcement proceedings specific to negotiable instruments. An instrument not presented within its period is thereafter regarded merely as prima facie written evidence and may be used in proving the underlying obligation between the parties.
Revocation of a Cheque
The drawer of an instrument that has not been presented within the presentment periods may, by exercising the right of revocation, prevent the drawee from paying against an instrument whose period has expired.
The moment from which revocation takes effect is regulated in Article 799 of the Turkish Commercial Code No. 6102:
Turkish Commercial Code No. 6102, Art. 799
“Revocation of a cheque takes effect only after the presentment period has expired.
Where the cheque has not been revoked, the drawee may pay the cheque even after the presentment period has expired.”
Period for Protest
The holder of an instrument that was presented in time but was not paid must notify those concerned of the position by way of protest in order to exercise the right of recourse against the endorsers, the drawer and the other parties liable on the cheque. The protest, which constitutes an official document, is regulated in Article 809 of the Turkish Commercial Code No. 6102:
Turkish Commercial Code No. 6102, Art. 809
“The protest, or an equivalent determination, must be made before the expiry of the presentment period.
If presentment is made on the last day of the period, the protest or the equivalent determination may also be made on the following business day.”
Force Majeure
Under Article 811 of the Turkish Commercial Code No. 6102, headed force majeure:
Turkish Commercial Code No. 6102, Art. 811
“Where the presentment of the cheque, or its protest, or the making of an equivalent determination within the periods laid down by law has not been possible on account of an insurmountable obstacle such as the legislation of a State or any event of force majeure, the periods laid down for those acts shall be extended.”
Accordingly, where there exists an insurmountable obstacle such as the legislation of a State or any event of force majeure, the relevant periods will be extended.
That said, the existence of force majeure imposes certain obligations on the holder, who must act in accordance with Art. 811 et seq. of the Turkish Commercial Code No. 6102:
“The holder is obliged to give notice of the force majeure to his own endorser without delay and to record that notice on the cheque or on an allonge, signing it and writing beneath it the place and the date. The provisions of Article 723 apply here as well.
After the force majeure has ceased, the holder is obliged to present the cheque for payment without delay and, where necessary, to have a protest or an equivalent determination made.
If the force majeure continues for more than fifteen days from the day on which the holder gave notice of it to the party liable preceding him, provided that it arose before the expiry of the presentment period, the right of recourse may be exercised without any need for presentment of the cheque or for the drawing up of a protest or an equivalent determination.
Facts relating solely to the holder, or to the person he has entrusted with presenting the cheque, drawing up the protest or having an equivalent determination made, are not deemed to constitute force majeure.”
That provision sets out the course to be followed by the holder when force majeure arises. As is apparent from the wording of the article, facts relating to the person of the holder, or of the person entrusted with carrying out the acts, are not deemed to constitute force majeure.
Statute of Limitations
The period during which the holder may exercise the right of recourse against the endorsers, the drawer and the other parties liable on the cheque, or during which one party liable on the cheque may exercise such a right against another, is regulated in Article 814 of the Turkish Commercial Code No. 6102:
Turkish Commercial Code No. 6102, Art. 814
“The rights of recourse of the holder against the endorsers, the drawer and the other parties liable on the cheque become time-barred upon the expiry of three years from the end of the presentment period.
The rights of recourse of one party liable on the cheque against another become time-barred upon the expiry of three years from the date on which that party liable paid the cheque or on which the cheque was asserted against him by way of an action.”
Calculation of Periods and the Effect of Public Holidays
In all of the periods addressed here, the days indicated as the starting point are not included in the calculation. Presentment of the instrument and its protest may be carried out only on a business day. If the last day of the period for presentment, protest or an equivalent determination falls on a Sunday or another public holiday, the period is extended so as to include the first following business day. Public holidays falling within the period, by contrast, are included in the calculation.
Independent Legal’s Assessment
The periods applicable to cheques form a whole whose components differ in nature but whose consequences are interwoven. The presentment period is preclusive; once missed, the instrument loses its character as a negotiable instrument. The statute of limitations, for its part, concerns the rights of recourse and likewise takes its starting point from the end of the presentment period. A delay at the presentment stage therefore affects not only collection at that moment but every subsequent avenue of recourse.
In terms of managing these periods, the following points should be observed:
- Taking into account that the presentment period begins on the day following the date of drawing written on the instrument
- Distinguishing between the ten-day and the one-month periods according to whether the place of payment is the same as the place of drawing; and, for instruments with a foreign element, assessing the continental criterion and the Mediterranean–Europe exception
- Having the protest drawn up, as a rule, before the presentment period expires, bearing in mind that where presentment is made on the last day the following business day may be used
- Giving notice of force majeure to the endorser without delay and recording that notice on the instrument or on an allonge
- Entering in the calendar the fact that the three-year limitation period for the rights of recourse runs from the end of the presentment period
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