Didim Today

This is indeed a universal warning. I have received a letter from a reader who signed a promissory note that was not filled in properly. The guy signed for TL 1,000, but the other party simply added another one at the beginning of the number and made it 11,000. It sounds stupid. Why should you sign a blank promissory note? It sounds very unlikely to happen to a sane person, isn’t it? However, a promissory note is the easiest instrument to issue as security.

For a very simple transaction a foreign person may be required to put his/her signature on promissory notes in Turkish. My office dealt with several cases and defended foreign persons many times on fraud or abused promissory notes which were given as security with good will. What is a promissory note?

A promissory note is a written promise committing an individual or institution to pay a specified sum of money at a fixed or determinable future date, with or without interest.

A promissory note is a contract detailing the terms of a promise by one party (the maker) to pay a sum of money to the other party, the payee. Business people use promissory notes very commonly as security for commercial purposes.

A valid promissory note must include the following elements according to Article 688 of the Turkish Commercial Code:

1. The wording “promissory note,” or if it is written in a foreign language, the correct translation of this wording in this foreign language should be included in the text of the promissory note.

2. An undertaking for an “unconditional” and “absolute” payment of a definite sum of money.

The definite sum can be shown in Turkish lira, or it is also possible to show it in a foreign currency.

3. The maturity date (non-existence of the maturity date does not invalidate the promissory note; a promissory note without a maturity date is generally considered to be payable on submission).

4. The name of the beneficiary.

5. The signature of the maker (or drawer).

6. The date of issuance.

7. The place of issuance. If the place of issuance has not been designated on the promissory note, then the promissory note is deemed to be issued at the place written next to the name of the issuer. 8. The place of payment. If one of these terms are missing on the promissory note, then the promissory note may not be deemed a promissory note anymore, and therefore, any legal action can be contested easily.

Why did I give you this boring list? I want you to see that issuing a promissory note is not something you do on the street. Please consult your lawyer if you are required to sign it. It is also a common practice to ask the maker to write the amount and to leave the other details blank. In this case the payee can fill in these blanks freely and any such promissory note shall be valid under Turkish law, provided they are duly signed by the maker.

I strongly recommend you not to use promissory notes for whatever reason since there is almost no difference in giving a promissory note or paying the same amount in cash. If you have to sign a promissory note for some reason then please make sure that there are no blank parts on the form.

If you leave the promissory note blank or in some way open to abuse and if someone fills it in and files it before the execution office then you may be forced to pay the amount written on the note. I should note that it is very difficult to get that paid money back because the gang who abused the note usually vanishes.

Berk Cektir http://www.berkcektir.av.tr/ The information provided here is intended to give basic legal information. You should get legal assistance from a licensed attorney at law while conducting legal transactions and not just rely on the information in this corner. http://www.todayszaman.com/ This e-mail address is being protected from spambots. You need JavaScript enabled to view it