The company signs a promissory note with the amount or maturity date left blank. By giving an aval, the managing director undertakes to pay it on the same basis as the company and is liable with all their assets. The creditor may complete it only in the manner and under the conditions set out in the completion agreement, for example if the loan is not being repaid. If the creditor completes it otherwise, the party who entered into the agreement with the creditor may raise this as a defence. Against a subsequent holder of the note, however, this defence is available only exceptionally. Slovakia and Czechia have almost identical legislation on bills of exchange and promissory notes, but court enforcement differs.
A creditor finances a company through a loan or lease and, as security, requires the company to issue a promissory note with the amount and maturity date left blank and the managing director to sign it as an avalist. A completion agreement is signed alongside the note, setting out when and how the creditor may fill in the missing details. In Slovakia, promissory notes are governed by the Bills of Exchange and Cheques Act (Act No. 191/1950 Zb.); in Czechia, they are governed by an Act with the same name and number (Act No. 191/1950 Sb.). Article I uses the same numbering in both Acts. Where the sections cited below do not identify an Act, they refer to that Article.
What the managing director signs
By giving an aval, you guarantee payment of the note (Section 30). A signature alone on the face of the note also constitutes an aval unless it is the maker’s signature; if it does not specify for whom the aval is given, it is deemed to be given for the maker (Section 31(3) and (4) and Section 77(3)). An avalist is liable on the same basis as the person whose obligation they guarantee, and the aval remains valid even if the company’s obligation is invalid for a reason other than a defect of form (Section 32(1) and (2)). All signatories are jointly and severally liable, and the creditor is not required to pursue them in any particular order (Section 47(1) and (2)). The creditor can therefore demand the amount payable under the note directly from you without first seeking recovery from the company. An aval may also cover only part of the amount (Section 30(1)), so a limit on its scope can be negotiated. The law does not provide for an aval to end when the managing director leaves office or sells their ownership interest. If you are leaving the company, you need to agree a release from the aval with the creditor.
In its judgment of 29 October 2024 (Case No. 5ObdoZ/1/2024), in the part in which it rejected the appeal on points of law as inadmissible, the Supreme Court of the Slovak Republic did not regard as a consumer a managing director who was also a shareholder and had given an aval on a note securing a loan to his company. For completeness, it noted that an avalist cannot derive defences from the debtor liable under the note. Referring to its earlier order in Case No. 5Obdo/26/2014, it stated that an avalist may rely on defences arising from the underlying relationship, such as the loan agreement, only if they prove the existence of an agreement concerning the note with its first holder that permits this. If the loan or lease were entered into by a consumer, securing the consumer’s obligation with a bill of exchange or promissory note would be invalid in Slovakia (Section 53(7) of the Civil Code, Act No. 40/1964 Zb.).
When the creditor may complete the note
This is determined by the completion agreement. Against the creditor with whom you entered into that agreement, you may raise the defence that the note was completed contrary to its terms. If the creditor transfers the note to someone else, failure to comply with the agreement may be raised against the new holder only if they acquired the note maliciously (the Czech wording refers to acquisition in bad faith) or were grossly negligent when acquiring it (Section 10). Before signing, therefore, ask for the text of the agreement and check in particular:
- which breaches of the loan or lease agreement entitle the creditor to complete the note,
- the maximum amount the creditor may enter and how it is calculated,
- how the maturity date will be determined,
- whether you also sign the agreement as an avalist, rather than only the company signing it,
- that the creditor will return the note once the loan has been repaid.
You may also propose a “not to order” clause. A note containing this clause may be transferred only with the effects of an ordinary assignment, rather than by endorsement (Section 11(2)).
Enforcement in Slovakia
The Code of Civil Contentious Procedure (Act No. 160/2015 Z. z.) does not provide for a special payment order for bills of exchange or promissory notes. The creditor may apply for an ordinary payment order. The court may issue one if it has no doubts about the facts alleged, particularly where they are supported by documentary evidence (Section 265(1)). A statement of opposition must be filed within 15 days of service and must state substantive grounds; otherwise, the court will reject it (Section 267(1) and (2)). Disputes concerning bills of exchange and promissory notes are heard by eight designated courts (Section 23). Claims against the maker of a promissory note become time-barred after 3 years from the maturity date (Section 70(1) and Section 78(1) of the Bills of Exchange and Cheques Act). The article promissory notes as security for a loan (forthcoming) (in Slovak) discusses this in more detail.
Enforcement in Czechia
The Czech Code of Civil Procedure (Act No. 99/1963 Sb.) retains a special payment order for bills of exchange and promissory notes:
The following quotation is reproduced in its original language:
Předloží-li žalobce v prvopisu směnku nebo šek, o jejichž pravosti není důvodu pochybovat, a další listiny nutné k uplatnění práva, vydá na jeho návrh soud směnečný (šekový) platební rozkaz, v němž žalovanému uloží, aby do 15 dnů zaplatil požadovanou částku a náklady řízení nebo aby v téže lhůtě podal námitky, v nichž musí uvést vše, co proti platebnímu rozkazu namítá.
If you do not file objections in time, the special payment order has the effects of a final judgment. The court will reject late objections and objections that give no reasons, and will disregard any objections raised subsequently (Section 175(3) and (4)). You should therefore include all grounds of defence in the objections filed within this time limit, including completion of the note contrary to the agreement.
If you signed a surety declaration instead of giving an aval, different rules apply, as explained in the question a surety’s position when the debtor enters bankruptcy. We will review the loan agreement, blank promissory note and completion agreement governed by Slovak law before you sign them through our suretyship and bank guarantees service. For loans between companies under either Slovak or Czech law, we will prepare these documents through our credit and loan agreements service.
This answer provides general information on the law as at 3 October 2026. It does not constitute legal services or replace an assessment of an individual case. The details of your situation may differ. Book a consultation to discuss them.
