Presentation of a Cheque and Force Majeure Pursuant to the Law No. 7226 on the Amendment to Certain Laws
Law on the Amendment to the Certain Laws (“Law”) numbered 7226 and dated 25.03.2020 entered into force through publication in the Official Gazette dated 26.03.2020 and numbered 31080 within the context of measures taken against the New Coronavirus Disease (“Covid-19”) outbreak affecting the entire world, as well as our country. Among other provisions, the Law stipulates administrative and legal measures concerning the Covid-19 outbreak. Below, Provisional Article 1 of the Law is examined within the scope of Cheque Law No. 5941 ("Cheque Law") and Turkish Commercial Code No. 6102 ("TCC") and, in particular, as to whether a force majeure that is specific to cheques as regulated in the TCC may be applied.[1]
Provisional Article 1 of Law No. 7226
With Provisional Article 1 of the Law, the following regulation is made:
PROVISIONAL ARTICLE 1– (1) In order to prevent any loss of judiciary rights as a result of the Covid-19 outbreak observed in our country;
- all time limitations related to the arising, use or termination of a right, including presentation and limitation periods, periods of prescriptions and mandatory administrative application … starting from 13/3/2020 (including this date),
- starting from … suspended until 30/4/2020 (including this date). These time limitations start from the day following the day the dwelling period ended. As of the date the dwelling period started, the periods that have fifteen or fewer days left, extends fifteen days starting from the day following the day the dwelling time ended. If the epidemic continues, the President may extend the suspension once, not exceeding six months, and narrow the scope for this period. These decisions are published in the Official Gazette.
With this Provisional Article, time limitations in the civil and administrative judiciary are suspended until 30.04.2020, starting from 13.03.2020. With the President’s Resolution on the Extension of the Dwelling Period for the Purposes of Prevention of Loss of Judicial Rights dated 29.04.2020 and numbered 2480 entered into force through publication in the Official Gazette dated 30.04.2020 and numbered 31114, the dwelling periods, except time limitations regarding mandatory administrative application remedy anticipated in Public Procurement Law No. 4734, are extended, to be reconsidered in case spread risk of pandemic disappears earlier, starting from 01.05.2020 (including this date) up until 15.06.2020 (including this date). However, the word “presentation” mentioned in the Article, and the expression “All time limitations related to the arising, use or termination of a right,” are interpreted in the doctrine by some authors,[2] as if the presentation period of a cheque is also within the scope of the Provision and, therefore, between 13.03.2020 and 15.06.2020 (including these dates) the presentation of a cheque is not possible, or such a presentation shall not bear any legal consequences. When this point of view is accepted, between the dates mentioned above, cheque bearers will not be able to present cheques to banks; even if they do present cheques, the banks shall not pay their money, nor shall the banks conduct necessary transactions if the cheque is dishonored, pursuant to Article 3/4 of the Cheque Law, and the shall not pay the dishonored cheque fee of 2.225.-TL, which is the minimum amount to be paid in accordance with Article 3/3 of the Cheque Law. Also, since cheques cannot be presented, the delay penalty of the bank due to non-payment of the cheque, despite being covered by the account pursuant to Article 3/7 of the Cheque Law, and the liability penalty of the bank official who does not pay the amount of the cheque pursuant to Article 7/5 of the Cheque Law, shall not arise. Again, in accordance with Article 793/I of the TCC, the endorsement made after the end of the presentation period shall not give rise to the provisions with regard to the assignment of claim, the withdrawal of the cheque by the drawer pursuant to Article 799 of the TCC, and the right of application of the bearer pursuant to the provisions of Article 808 of the TCC, as well as the following provisions.
If it is accepted that the presentation period of a cheque is suspended with the Provisional Article of the Law (unless a separate resolution regarding the extension is made by the President), the suspended presentation period will continue from the day following the day the dwelling time ended, the presentation period of the cheques that has fifteen or fewer days left as of 13.03.2020 shall end at the close of business on 15.06.2020. Accordingly, cheques that have 15.06.2020 or after as their written issuance date (unless a separate resolution regarding the extension is made by the President) shall not be presented to the addressee bank in order to be paid prior to the issuance date pursuant to Provisional Article 3/5 of the Cheque Law. Cheques that bear the date of 13.03.2020, or the date of presentation was a previous date, but has not yet ended on 13.03.2020, are within the scope of Provisional Article 1 of the Law.[3] It is, hereby also necessary to make a distinction in accordance with Article 796 of the TCC. Cheques with ten days’ presentation period pursuant to Article 796/1 of TCC will be presentable until 30.06.2020 (including this date), extending 15 days from 15.06.2020.
For cheques with one month and three months presentation period pursuant to Article 796/3 of the TCC, and if there is more than fifteen days to the end of the presentation period as of 13.03.2020, the presentation period shall be suspended, and shall continue as of 15.06.2020. Otherwise, 30.06.2020 (including this date) will be the last presentation date.
As it is clear, in the initial provisions of the laws, the enforcement framework of the law is drawn under the "purpose and scope" Article of the law, and this Article gains importance, especially in its interpretation. However, due to the “omnibus bill” nature of the Law, no such provision has been stipulated. From this perspective, in the introduction part of the Article, the expression, “in order to prevent loss of judiciary rights due to the presence of the Covid-19 outbreak in our country,” is included. Therefore, if the verbal interpretation of the Article is taken as a basis, it can be concluded that the proposed regulation is limited to the prevention of loss of judiciary rights.
In our opinion, the periods listed under subparagraphs (a) and (b) under the first paragraph of Provisional Article 1 shall halt until April 30, 2020 (including this date). The scope of the expression, “All the periods regarding the arising, use, or termination of a right, including filing a lawsuit, initiating enforcement proceedings, application, complaint, appeal, warning, notification, including presentation and limitation periods, period of prescriptions and mandatory administrative application periods,” stipulated in the Article is limited to the judicial proceedings and the duration of proceeding. The presentation period of cheques and securities, in general, cannot be accepted as a period related to judicial proceedings and, therefore, these periods shall continue. The necessary transaction for a dishonored cheque shall be made.
Force Majeure considering Cheques
It can also be considered that there is no need to make a separate regulation regarding the presentation in Provisional Article 1 of the Law, since a force majeure cause specific to cheques is included in the TCC. Pursuant to Article 811/1 of TCC, “If the presentation of a cheque or its protest or an equivalent determination could not be realized within the period determined by law due to an insurmountable obstacle, such as a state legislation, or any force majeure, said periods extend.” The purpose of the provision is to prevent the bearer from any loss of right and opportunity to obtain his/her receivables by extending the periods during the force majeure due to the fact that the bearer could not perform the actions and procedures that are legal burdens, such as the presentation. As is accepted by the doctrine, this provision does not bear any consequences for the drawer.
The “state legislation” or “force majeure” as listed in the Article is representative of "insurmountable obstacle," and does not qualify as numerus clausus.[4] However, the impossible obstacle to overcome must be objective. This is understood both from the general definition made by the doctrine of the force majeure expression stipulated in the Article, and the provision of the 811/5 of the TCC, which states that “The facts solely about the bearer, or the person assigned by the bearer to present the check, to protest, or to make an equivalent determination, are not considered to be force majeure.”[5]
It is necessary to evaluate whether the Covid-19 outbreak is an obstacle that is impossible to overcome objectively in terms of the bearer. It can be said that even though the banks have restricted their working hours, or have closed certain branches, since they continue their activities, there is no situation arising from banks preventing presentation, which constitutes an insurmountable obstacle for the bearer.
However, according to Circular No. 6235, issued by the Ministry of Internal Affairs on 21.03.2020, since citizens aged 65 and over, with low immune systems, chronic lung disease, asthma, COPD, cardiovascular disease, kidney, hypertension and liver disease, and those using drugs that disrupt the immune system, and those under 20 years of age, are under lockdown, with respect to bearers described, above, and there may be an objectively insurmountable obstacle in the context of the "state legislation," as specified in Article 811/1 of the TCC. In our opinion, the Covid-19 outbreak can also be described as a force majeure for bearers who are not subject to the above-mentioned administrative restriction, pursuant to Article TTK 811/3 of the TCC, and cheque bearers are required to present their cheques to be paid without delay after the force majeure disappears and, when necessary, they must protest or make an equivalent determination pursuant to 811/3 of the TCC.
Again, in order to be able to withstand the force majeure that is specific to the cheque stipulated in the TCC, it is obligatory for the cheque bearer to notify the reason of the force majeure pursuant to Article 811/2 of the TCC to his endorser, and to record this notice on the cheque, or in its amalgamation, and to sign it by writing the location and date.
Provided that it is before the end of the presentation date pursuant to Article 811/4 of the TCC, if the bearers’ force majeure continues more than fifteen days following the day s/he notified the debtor before him pursuant to Article 811/2 of the TCC, the application rights may be used without cheque presentation and protest, or any other equivalent determination.
Conclusion
In light of the assessment made, above, it is considered that Provisional Article 1 of the Law regulates the suspension of judicial time limitations, it does not suspend the presentation period with regard to securities, it does not prevent conduction of “unrequited” transaction in terms of cheques, and the cheque bearers may benefit from the provision of Article 811 of the TCC.
[1][1] Sarıkaya, Sinan: 7226 Sayılı Kanun’un Geçici 1. Maddesinin Çeklerin İbrazı ve Karşılıksız Çek Suçuna Etkisi, blog.lexpera.com.tr (Access date: 25. 04.2020).
[2] Deynekli, Prof. Dr. Adnan: “7226 Sayılı Kanunla Yapılan Düzenlemenin Sürelere Etkisi Yönünden Değerlendirme,” 1 April 2020, https://app.e-uyar.com/blog/index/478d6362-2806-49be-a6c2-89976b382794;
Paslı, Dr. Ali: “COVID-19 Salgınının Çek Hukukuna Etkisi: Güncel Koşullar Sürerken Çek İbrazı Mümkün Müdür?” 31 March 2020, http://www.ticaretkanunu.net/ali-pasli-covid-19-salgininin-cek-hukukuna-etkisi-guncel-kosullar-surerken-cek-ibrazi-mumkun-mudur/; Dural , Dr.Ali: “COVID-19 Salgını Nedeniyle Yürürlüğe Giren 7226 Sayılı Kanun’un Geçici 1. Maddesinin Çek Açısından Sonuçları” 9 April 2020, https://blog.lexpera.com.tr/covid-19-salgini-nedeniyle-7226-sayili-kanunun-cek-acisindan-sonuclari/ (Access date: 25.04.2020)
[3] Dural, ibid.
[4] Öztan, Fırat: Kıymetli Evrak Hukuku, 2nd ed., Ankara 1997. Poroy, Reha / Tekinalp, Ünal: Kıymetli Evrak Hukuku Esasları, 22nd ed., Istanbul 2018.
[5] Dural, ibid.
All rights of this article are reserved. This article may not be used, reproduced, copied, published, distributed, or otherwise disseminated without quotation or Erdem & Erdem Law Firm's written consent. Any content created without citing the resource or Erdem & Erdem Law Firm’s written consent is regularly tracked, and legal action will be taken in case of violation.
Other Contents
The Turkish automobile and light commercial vehicle market left the 2000s behind with steadily rising sales figures and the 2010s with high and stable sales figures as well. In this period, the growth of the market was driven not only by high purchase power but also by easy access to credit and product diversity...
Turkish Commercial Code No. 6102 ("TCC") provides the right to exit from the company to the shareholders of limited liability companies and the right to squeeze out the shareholder from the company, unlike the structure of joint stock companies, with the exit and squeeze out institutions specially regulated for...
Turkish Commercial Code No. 6102 (“TCC”) preserves the rule that the board of directors shall manage and represent joint stock companies. The TCC regulates how the power of representation shall be exercised, the registration and announcement of the persons authorized to represent, the transfer of the...
Ordinary partnerships are regulated under Turkish Law between Articles 620 and 645 of the Turkish Code of Obligations No. 6098 (“TCO” or the “Code”). The Law defines an ordinary partnership contract as a contract where two or more persons undertake to combine their labour or property to achieve a common...
Merger and acquisition processes are one of the legal processes that most seriously affect the identities and legal status of companies. After the completion of legal, tax, financial and operational due diligence reports, the parties initiate the negotiation process in case they reach an agreement on proceeding with the...
A popular business model for expanding market reach and brand recognition worldwide is franchising. Despite being less common than distribution agreements in the form of mono-brand store agreements, franchising is another significant method for extending luxury brands' distribution networks. Luxury brands use...
In the decision dated 14.06.2022 and numbered 2019/149 E. 2022/894 K., the Court of Cassation General Assembly (“CCGA”) evaluated the theory of piercing the corporate veil in the context of the relationship between the guarantor and the borrowing company in a dispute arising from a loan agreement...
The European Union continues to be an important investment center for foreign investors. According to data from the European Commission's "Second Annual Report on the monitoring of foreign direct investment in the European Union", the European Union received €117 billion worth of foreign direct investment in...
Transfer of shares is arguably the first legal transaction that comes to mind among the legal transactions regarding the shares of a capital company, and the most common transaction in practice. However, the shares of a capital company may also be subject to various transactions, other than share purchase...
Law No. 6563 on the Regulation of Electronic Commerce (E-commerce Law or Law) has recently undergone a radical change in order to regulate the behavior of the players in the rapidly growing and developing e-commerce sector. The new regulations that came into force as of January 1, 2023 envisage important...
On 11 June 2021, the German Federal Parliament approved the German Supply Chain Due Diligence Act (Lieferkettensorgfaltsgesetz) (“Act”) which affects not only German entities but also their suppliers in foreign countries (including Turkish entities). The main focus of the Act, which entered into force on...
On 21 December 2007, the Federal Council approved the draft revision of the Swiss Code of Obligations, which also includes amendments to company law. On 28 November 2014, the Federal Council referred the draft revision for consultation. Following extensive discussions and a long enactment process, the...
The Turkish Commercial Code No. 6102 ("TCC") regulates maritime trade contracts under the fourth part of the fifth book of the Code. Among the types of contracts regulated in this section, the most frequently used contract in international maritime transport practice is the freight contract regulated under...
Prohibition on hidden income shifting is one of the most important issues that is broadly regulated under Capital Markets Law No. 6362 (“CML”). In conjunction with CML Article 21, which has a broader context than Article 15 of the abrogated Capital Markets Law No. 2499, another significant step has been taken...
As a result of developing commercial activities and large-scale investments, especially concluded in the fields of construction, energy and mining, companies are seeking to participate in these investments by uniting their powers and expertise to take advantage of financial opportunities together. This tendency...
The Turkish Commercial Code (“TCC” or “Law”) has enabled companies to apply different structural models and to implement new legal formations by including spin-off provisions to its Article 159 et seq. In accordance with the provisions of the law, companies may transfer a certain element, or elements, of their...
The International Federation of Consulting Engineers is a professional association established in 1913, known as the FIDIC (Fédération Internationale Des Ingénieurs-Counseils). Its members are duly elected from consultant-engineer associations of various countries, and membership to the association is...
Incoterms are a set of rules introduced by the International Chamber of Commerce (ICC) to explain the commercial terms that are widely used in international trade. The purpose of Incoterms rules is to facilitate and expedite international trade in a safe and secure manner...
The regulation applicable to all Turkish ports prepared by the Ministry of Transport, Maritime Affairs and Communications that entered into force after being published in the official gazette on October 31, 2012 (˝the Regulation˝), consolidates all the bylaws, regulations and instructions in a single Regulation...
As a rule, rights and obligations arising from an agreement have legal consequences only between the creditor and the debtor which are parties to the agreement. This principle is referred to as "privity of contract." In general, contracts for the benefit of third parties, where the fulfillment of an...
The rules of e-commerce, which grow and develop with the digitalizing world, are changing. E-commerce has become the driving force of the digital economy. However, considering the growth rate of e-commerce and the transformation it has undergone in a short time, it is obvious that some...
The dissolution of a company is a specific type of dissolution, which results in the cancellation of the legal personality which was gained by registration at incorporation. The specific proceeding which leads to the dissolution, and thus, the termination of a company upon the constitutive decision...
Companies in which shares or authority to manage is held by members of a family are considered to be “family businesses”. Family members can hold shares that control the company, as well as retain management authority. Having a family business means opportunity, security and income for...
Turkey ratified the Convention on the Contract for International Carriage of Goods by Road (“CMR”) in accordance with Act No. 3939 dated 7 December 1993, and the CMR entered into force in Turkey on 31 October 1995. In accordance with Article 1 / 1 of the CMR, the carriage of goods by road...
Ordinary partnerships are governed by Article 620 et seq. of the Turkish Code of Obligations No. 6098 (“TCO”). An ordinary partnership agreement is defined as an agreement whereby two or more persons undertake to join efforts and/or goods to reach a common goal...
The concept of disguised profit transfer in joint stock companies, in its broadest meaning, covers the transfer of company assets to related parties and may occur in different ways. This concept is regulated in detail under capital markets legislation...
Share subscription agreements, which are commonly encountered in start-up investments, set out the terms and conditions of an investor’s participation in a company as a shareholder by subscribing the new shares issued in a capital increase...
The electronic signature, which has the same legal consequences as wet signatures if it meets certain conditions, has taken its place in many legal systems and has enhanced commercial life. Although there are various types and applications in different legal systems...
INCOTERMS are a set of rules introduced by the International Chamber of Commerce (ICC) to explain the commercial terms that are widely used in international trade. The purpose of the Incoterms rules is to contribute to and facilitate the safe and swift conduct of international trade...