What Performance Orders?

Certain commercial debts, undeniably established in writing, often conclude with default judgments against debtors who deliberately avoid attending court sessions to stall proceedings. To address this issue, Saudi regulatory bodies have introduced a solution allowing creditors to swiftly secure their written commercial debts. This solution involves simplified procedures to obtain a court order from the competent commercial court to fulfill the debt after submitting the written evidence. This court order, known as a "Performance Order," comes with accelerated enforcement, enabling immediate execution against the debtor.

Conditions for a Debt to Qualify

1.    Documented Debt: The debt must be explicitly documented, whether in an official or customary document, in paper or electronic form.

2.    Debt Due for Payment: The debt must be due and not contingent on any condition or deferred to a future date.

3.    Specific Amount: The debt must be of a specified amount, such as money or movable assets, and must not be disputed, as the judge issuing the order does not delve into the merit of the claim but only considers the evidence of debt meeting the order's issuance criteria.

4.    Commercial Nature of Debt: The debt should be of a commercial nature (based on jurisprudence, not explicitly stated in law).

5.    No Statute of Limitations: The right to claim the performance order should not be barred by a statute of limitations, typically five years from the right's inception (based on jurisprudence, not explicitly stated in law).

Essential Pre-Application Procedure for Issuing

1.    The creditor must notify the debtor urging immediate payment and warning of legal action to obtain a performance order.

2.    A minimum of five days should elapse between the notification and the application for a performance order.

3.    The notification must specify the date on which the creditor intends to apply for the order.

Circumstances Where a Performance Order is Not Accepted

A performance order may be dismissed if the debtor resides outside the kingdom or if the debt document includes mutual obligations, except if the creditor submits written proof of fulfilling their part.

Adjudication Guidelines

1.    The court reviews the performance order request without confronting the parties.

2.    The court decides on the request within ten days from its registration, although this timeline is not mandatory.

3.    A decision to reject the request is final, allowing the creditor to file a lawsuit according to established procedures to claim their debt.

4.    If the court recognizes the creditor's right to a performance order, it issues the order on a special form with an accelerated enforcement clause, enabling the creditor to execute the order through the execution court.

Objecting to a Performance Order

The system provides the debtor with two methods to object to the issuance of a performance order:

1.    Primary Court Appeal: The debtor has 15 days from the notification of the performance order to appeal. If the court finds the order non-compliant, it may annul the order and decide on the case's merit.

Appeal Court Objection: If the performance order is flawed, such as notification invalidity or jurisdiction issues, the debtor can appeal directly to the appellate court.

2.    Consequences of Appeal: The appellate court may either reject the appeal and uphold the performance order or annul it based on the appeal's merits.

 

This approach establishes performance orders as a straightforward mechanism for creditors to efficiently enforce commercial debts, emphasizing the need for precise compliance with procedural requirements for successful debt recovery.