Promissory notes

A promissory note is a negotiable instrument embodying a unilateral undertaking by one person, the maker, to pay a specified sum of money to another, the payee. In essence, it is the debtor’s written, unconditional promise to pay a specified sum. To be valid, it must strictly comply with the form required by law. Under Article 535 of the Commerce Act, the note must contain all of the following particulars: the words “promissory note” in both the heading and the text of the document, in the language in which it is drawn up; an unconditional promise to pay a specified sum of money (the amount must be clearly stated, not merely capable of being determined); the maturity date; the place of payment; the name of the person to whom, or to whose order, payment must be made; the date and place of issue; and the maker’s signature. A document lacking any of these particulars is not a promissory note, except in the cases provided for in Article 536(2), (3) and (4) of the Commerce Act. If any of the other elements listed in Article 535 is missing, the document cannot be regarded as a valid promissory note.

This article is not a legal opinion or advice on any particular situation or person. For assistance with a matter involving civil law, the Obligations and Contracts Act, a promissory note and/or a bill of exchange, consult a lawyer.