Promissory bill (“billet à ordre”) pursuant to French law
What is a promissory bill (“billet à ordre”) pursuant to French law ?
A promissory bill (“billet à ordre”) is a document of title by which a person undertakes to pay to the order of another person, known as the beneficiary, a certain sum of money on a specific date.
What principles govern the payment of the promissory bill (“billet à ordre”) in France?
Payment by promissory bill (“billet à ordre”) must be expressly agreed between the debtor and the creditor and mentioned on the invoice.
If the bill is not received within thirty days after the invoice is sent, the creditor may issue a bill of exchange.
The promissory bill involves only two people, the subscriber and the beneficiary, and does not require acceptance or provision.
The mandatory information in the promissory bill is the promissory clause, the promise to pay a specific sum, the maturity date, the place and the name of the beneficiary and the subscriber.
The optional particulars of the bill of exchange may also be inserted in the promissory bill if they are compatible with its particular nature.
The creation of a promissory bill between the subscriber and the beneficiary does not novate the pre-existing fundamental relationship.
The promissory bill contains several mandatory mentions listed in article L. 512-1 of the Commercial Code, and the failure to respect one of these mentions may invalidate the document.
The payment of the promissory bill follows the rules of the bill of exchange, except for two exceptions: the drawee cannot ask for a second presentation and promissory bills payable at a certain time of sight must be presented to the visa of the underwriter in one year.
In case of default of payment, a protest must be drawn up, failing which the bearer will be qualified as negligent and deprived of his recourse against the endorsers.
The guarantee is the most important guarantee of the promissory bill and the rules relating to the guarantee of the bill of exchange are applicable to the promissory bill.
If the endorsement does not indicate on whose behalf it was given, it is deemed to have been given on behalf of the subscriber of the promissory bill.
French law governing promissory bills :
- C. com. L. 512-1 et seq.
Main decisions of French courts on promissory bills ("billets à ordre"):
- Com. May 19, 2015, No. 14-17.401
- Com. Sept. 13, 2011, No. 10-19.963