Guaranty of bill of exchange

An avat takes place between guaranty law and negotiable instrument law. Aval was created by aiming guaranty of bill of exchange which used in credit agreement and then it was codified. Avalist has strict responsibilities, according the other guaranties. That's why an aval has more advantage, than other guaranties, when meeting trust needs in the trade life. Another speciality of aval that used in trade is to negotiate easily rights on the instrument. Although it isn't explained in the Turkish Commercial Law (TTK), responsibility of avalist based on contract Defences on this contract may not set up against the goodwill third person. In respect of the most defences, that may be raised by the person for whom he has became a guarantor, cannot use by the avalist. Aval is formed with declaration on the instrument. This declaration include, "aval" or words of similar impact, a specify the person whom avalist became guarantor and signature of avalist. In the absence of such specification, the person for whom he became guarantor is the drawer. Avalist may limit his own liability by an express stipulation in the instrument. This stipulation is effective only Avalist is between parties, whom he became guarantor and who has right on the instrument against whom he became guarantor. Rights and liabilities of avalist define from this position. Avalist hold responsible to parties, who may exercise his right against whom avalist became guarantor. In the same way, when he pays the instrument, he may recover from the party for whom he has became guarantor and from the parties who are liable on it to that party. TT