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Federal Law No. 5

Issued on 15/12/1985
Corresponding to 3 Rabi’ al-Thani 1406 H.
On the Civil Transactions Law of the United Arab Emirates State
Amended by
Federal Law no. 1/1987 dated 14/2/1987
Federal Decree-Law No. 30 dated 27/09/2020
We Zayed Bin Sultan Al Nahyan President of the United Arab Emirates State,
Pursuant to the perusal of the provisional Constitution, and
Federal Law no. 1 of 1972 concerning the Jurisdictions of the Ministers and the Powers of the Ministers
and the amending laws thereof, and
Acting upon the proposal of the Minister of Justice and the approval of the Council of Ministers and the
ratification of the Federal Supreme Council,
Have promulgated the following Law;

Article 1
As amended by Federal Law no.1 dated 14/2/1987:
The civil Transactions in the United Arab Emirates State shall be subject to the law, whereas the
commercial transactions remain subject to the laws and regulations applicable in their regard, pending the
issuance of the Federal Commercial Law.

Article 2
As amended by Federal Law no.1 dated 14/2/1987:
This Law shall be published in the Official Gazette and shall come into force as of 29 of March 1986.
Promulgated by Us at the Presidential
This Federal Law was published in the Official Gazette, issue no.158, Palace in Abu Dhabi
p. 11
On 3 Rabi; al-Thani 1406
Corresponding to 15/12/1985
Zayed Bin Sultan Al- Nahyan
President of the United Arab Emirates StateINTRODUCTORY TITLE GENERAL PROVISIONS

CHAPTER ONE

APPLICATION OF THE LAW AND ITS EFFECTIVENESS IN TIME AND SPACE

SECTION ONE

THE LAW AND ITS APPLICATION

Article 1
Legislative provisions shall be applicable to all matters dealt therein, in letter and context. In presence of
an absolutely unambiguous text, there is no room for personal interpretation. In the absence of a text in this
Law, the judge shall adjudicate according to the Islamic Shari'a taking into consideration the choice of the
most appropriate solutions in the schools of Imam Malek and Imam Ahmad Ben Hanbal and, if not found
there, then in the schools of Imam El Shafe'i and Imam Abou Hanifa, as the interest so requires.
Where no such solution is found, the judge shall decide according to custom, provided it is not
incompatible with public policy and morals. In case the custom is restricted to a specific Emirate, it shall be
effective therein.
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Article 2
In understanding, interpreting and construing the text, the rules and fundamentals of Islamic doctrine shall
be followed.

Article 3
Shall be considered of public policy, provisions relating to personal status, such as marriage, inheritance,
lineage, provisions relating to systems of governance, freedom of trade, circulation of wealth, private
ownership and other rules and foundations on which the society is based, provided that these provisions are
not inconsistent with the imperative provisions and fundamental principles of the Islamic Shari'a.

SECTION TWO

APPLICATION OF LAW AS TO TIME

Article 4
1- A legislative provision may not be repealed or stopped except by a subsequent law provision expressly
so stating, or including a provision inconsistent with the previous legislation, or regulating anew the matter
formerly regulated by that legislation.
2- Where a law provision repeals another provision and the former is later repealed, this shall not entail
reinstating the latter unless so expressly provided.

Article 5
1- Provisions concerning capacity shall be applicable to persons to whom the conditions set forth in these
provisions apply.
2- Where a person is capacitated under the old provisions and becomes incapacitated under the new
provisions, this shall not affect his previous acts.

Article 6
1- The new provisions relating to limitation of time for lawsuits shall apply as of their effective date on
each unexpired period of limitation.
2- The old provisions shall, however, apply on matters concerning the commencement, stay and
interruption of limitation during the period preceding the effective date of the new provisions.

Article 7
1- Where the new provision sets forth a period of limitation shorter than that presented in the old provision,
the new period shall apply as of the effective date of the new provision even though the old period had
already started to run.
2- Should the remainder of the period presented by the old provision be shorter than the period stated in the
new provision, limitation shall operate upon the expiry of the said remainder.

Article 8
Evidence in support shall be governed by the provisions in force at the time they are, or should have been
prepared.

Article 9
Unless otherwise provided by law, periods of time shall be computed according to the Gregorian calendar.

SECTION THREE

APPLICATION OF LAW AS TO PLACE

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Article 10
The Law of the State of the United Arab Emirates shall authoritatively characterize the relationships when
it is required to determine their nature in a case involving a conflict of laws in order to determine which of
these laws is to be the governing law.

Article 11
1-Civil status and capacity of persons are governed by the law of the State to which they belong by
nationality. However, in financial dealings transacted in the State of the United Arab Emirates and producing
their effects therein, should one of the parties be an incapacitated alien and the reason of his incapacity is not
easily detected by the other party, this reason shall not affect his capacity.
2-The legal system related to foreign juridical personalities, such as companies, associations, institutions
and others shall be governed by the law of the State where such personalities have the actual headquarters
thereof. Should such personalities carry out an activity in the United Arab Emirates State, the national Law
shall prevail.

Article 12
The provisions of Clause (1) of Article (12) have been replaced by virtue of Article 1 of
Federal Decree-Law no. 30 dated 27/09/2020, to read as follows:
1-For the substantive conditions for the validity of marriage, the law of the country where the marriage was
concluded shall be referred to.
2-However, in the form, marriage between two foreigners, or between a foreigner and a national shall be
deemed valid should it be concluded in accordance with the conditions of the State where it is concluded, or
should it take meet the conditions set forth by the law of each of the spouses.

Article 13
The provisions of Article 13 have been replaced by virtue of Article 1 of Federal Decree-
Law No. 30 dated 27/09/2020, to read as follows:
1- The law of the State where the marriage was concluded shall govern the personal and financial impacts
resulting from the contract of marriage.
2- Divorce, repudiation and separation shall be governed by the law of the State where the marriage was
concluded.

Article 14
In cases referred to in the preceding two articles, should one of the spouses be a national upon the
conclusion of marriage, the law of the United Arab Emirates alone shall apply, with the exception of the
condition of capacity for marriage.

Article 15
The abidance by the alimony among relatives shall be governed by the law of the person commissioned
therewith.

Article 16
The objective matters related to guardianship, custody, tutelage and other objective systems to protect
persons lacking capacity shall be governed by the law of the person whose protection is required.

Article 17
The provisions of Article 17 have been replaced by virtue of Article 1 of Federal Decree-
Law No. 30 dated 27/09/2020, to read as follows:
1- Subject to the provisions of Paragraphs (3) and (4) of this Article, heritage shall be governed by the law
applicable in the state of testator at the time of his death.
2- The financial rights present on the State’s territory and which belong to a foreigner having no heirs shall
be transferred to the State.
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3- The substantive provisions of the will and all actions related to the after-death stage shall be governed
by the law of the State as specified by the will or the alienation act, or the law of the state to which the person
carrying out such action belonged upon his death if no law is specified by the will or the alienation act.
4- The form of the will and all alienations related to the after-death stage shall be governed by the law of
the State of the person carrying out such alienations upon the issuance thereof, or the law of the State in
which such action took place.
5- Provided that the law of the United Arab Emirates prevails regarding the will issued by a foreigner for
the real-estates thereof in the State.

Article 18
1-The acquisition ownership and other in kind rights shall be governed by the law of the location with
regards to the real-estate, and the law of the party where the moveable property is located upon the
achievement of the reason entailing the acquisition, ownership or other in kind rights, or the loss thereof, and
such with regards to such moveable property.
2-The law of the State where the fund is located shall determine whether such fund is a real-estate or a
moveable property.

Article 19
1-Contractual commitments in form and context shall be governed by the law of the State where the
common residence of the contracting parties is located. Should they have different residences, the law of the
State where the contract is made shall apply, unless the parties agree otherwise, or the conditions show that
another law is to be applied.
2-However, the law on the location of the real-estate is the law to be applied on contracts made in this
regard.

Article 20
1-Non-contractual commitments shall be governed by the law of the State where the incident causing the
commitment takes place.
2-The provisions of the preceding paragraph shall not apply regarding commitments arising from an illegal
business, and such with regards to the incidents carried out abroad and considered legal in the United Arab
Emirates, even if they are deemed illegal in the country where they take place.

Article 21
The rules of jurisdictions and all procedural matters shall be governed by the law of the State where the
case is filed or where procedures take place

Article 22
The provisions of the preceding articles shall not apply should there be a text in a special law or an
international treaty enforced in the country that contradicts such provisions.

Article 23
The principles of the special international law shall apply with regards to matters not mentioned in the
preceding articles related to the conflict of laws.

Article 24
The law of the United Arab Emirates shall apply with regards to stateless persons, or to persons having
multiple nationalities. However, people proven to hold the UAE nationality and the nationality of another
State, the law of the United Arab Emirates shall be applied.

Article 25

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Where, in the provisions of the preceding Articles, the governing law is that of a specific country that has a
multi-legislative system, the domestic law in this country shall indicate which law in this system should be
applied. In the absence of such indication, the prevailing law or the law of the domicile, as the case may be,
shall apply.

Article 26
1- Should the governing law be a foreign one, its domestic provisions shall be applied, to the exclusion of
the private international law provisions.
2- The Law of the United Arab Emirates State shall, however, be applied in case of renvoi to its provisions
from the governing law.

Article 27
The provisions of Article 27 have been replaced by virtue of Article 1 of Federal Decree-
Law No. 30 dated 27/09/2020, to read as follows:
The provisions of any law specified in Articles (10), (11), (18), (19), (20), (21), (22), (23), (24), (25), (26)
of this Law may not be applied in case they are contrary to the Islamic Shari'a, public policy or morals in the
United Arab Emirates State.

Article 28
The law of the United Arab State shall apply in case the existence of the governing foreign law cannot be
established or its context cannot be delimited.

CHAPTER TWO

CERTAIN DOCTRINAL PRINCIPLES AND ROLES OF INTERPRETATION

Article 29
Ignorance of the Shari'a provisions is no excuse.

Article 30
Exceptions may neither be applied by analogy not receive extended interpretation.

Article 31
What is established by a mandatory provision shall have precedence over obligation prescribed by a
condition.

Article 32
That without which an obligation cannot be fulfilled is in itself an obligation.

Article 33
A rule and its cause, go together in their existence or their negation.

Article 34
Fungibles are not perishable.

Article 35
Certainty is not removed by doubt.

Article 36
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Things, in principle, should remain as they were.

Article 37
In principle, a person’s financial is free from liability.

Article 38
Contingent characteristics are considered, in principle, as non-existing.

Article 39
What is established to exist at a certain time shall remain in existence, unless there is evidence to the
contrary.

Article 40
An event should in principle be attributed to its nearest time of occurrence.

Article 41
No analogy may be made with what has proven to be contrary to analogy.

Article 42
1- No prejudice caused and no harm inflicted.
2- Prejudice should be removed.
3- Prejudice is not removed by a similar one.

Article 43
Necessities allow breaking prohibitions.

Article 44
Preventing corruption is better than drawing benefits.

Article 45
Compulsion does not impair the right of third parties.

Article 46
1- General or particular, usage is binding.
2- Usage, if constant or prevalent, shall be taken into consideration.
3- Truth shall remain unchanged if corroborated by usage.

Article 47
Utilization by the public is evidence to be followed.

Article 48
What is impossible by usage is impossible in fact.

Article 49
Prevalence and notoriety shall be taken into account not rareness.

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Article 50
That is known by usage amounts to a stipulated condition.

Article 51
Designation by usage is a designation by text.

Article 52
Where an impediment conflicts with a requirement, the former shall have precedence.

Article 53
Accessory is appurtenant and may not be individualized independently.

Article 54
Where the principal is forfeited, the ancillary follows.

Article 55
That is forfeited, alike the inexistent, shall not come back to existence.

Article 56
Voidance shall extend to the thing and its contents.

Article 57
Where the principal is void the substitute shall be sought.

Article 58
To be effective against the public, a disposition is contingent on interest thereto.

Article 59
Answer reproduces the question.

Article 60
Imagination is not taken into consideration.

Article 61
No consideration is to be given to a belief overtly incorrect.

Article 62
What is established by proof amounts to eye-witnessing.

Article 63
A person is bound by his acknowledgment.

Article 64
An auxiliary matter may be established by proof though the principal is not.

Article 65
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Appearance may stand as a proof for defense but not for claiming a right.

Article 66
Land tax is due by the exploiter.

Article 67
Charges in consideration of profits.

Article 68
An order to dispose of someone else's property is void.

Article 69
He who accelerates the happening of a thing, before it is due, shall be deprived of it.

Article 70
He who challenges what has been done from his part his attempt shall turn against him

CHAPTER THREE

PERSONS

SECTION ONE

PHYSICAL PERSONS

Article 71
1- Personality of a human being starts at his birth alive and ends upon its death.
2- The law shall determine the rights of a fetus.

Article 72
1- Birth and death events are established through their recording in the ad hoc registers.
2- Where the evidence is missing or if it appears that the data recorded are not true, any legal means of
proof is accepted.

Article 73
Provisions concerning foundlings are regulated by a special law.

Article 74
Provisions relating to missing persons or absentees are regulated by a special law.

Article 75
1- Nationality of the State of the United Arab Emirates is regulated by law.
2- A citizen, wherever this expression appears in the Civil Transaction Law, means the person who has the
nationality of the Emirates State, the alien being the person who has not such nationality.

Article 76
1- The family of a person is composed of his wife and relatives.

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2- Relatives are all those of common ancestry.

Article 77
1- Direct kinship is the relation between ascendants and descendants.
2- Indirect kinship is the relation between persons of common ancestry, without being an ascendant or
descendant of the other, regardless of the degree of consanguinity.

Article 78
In calculating the degree of direct kinship, each descendant is a degree upward to the ascendant not
counting the latter.In calculating the degree of indirect kinship, degrees are counted upwards from the
descendant to the common ancestor and then downwards from this latter to the other descendant, each
descendant, excluding the common ancestor, is counted a degree.

Article 79
A relative of one of the spouses is considered of the same degree of kinship in relation to the other spouse.

Article 80
1-Every person has a name and surname, the latter shall attach to his children's name.
2-A special law shall regulate the mode of acquiring and changing names and surnames.

Article 81
1-Domicile is the place where a person habitually resides.
2-A person may have at the same time more than one domicile.
3-Where a person has no habitual residence, he shall be considered without domicile.

Article 82
The place where a person carries out a trade, a profession or a craft shall be considered his domicile as
concerns his activities relating to his trade, profession or craft.

Article 83
1-The domicile of a minor, interdicted, missing or absent person shall be the domicile of his legal
representative.
2-The minor authorized to carry out a trade shall have a special domicile as concerns the acts and dealings
to which he is considered by law apt to perform.

Article 84
1-A person may elect a domicile of choice to perform a specific legal act.
2-Election of a domicile must be established in writing.
3-A domicile elected for the performance of a legal act shall be considered the domicile for all matters
relating to this act, including execution procedures, unless it is expressly specified that this domicile is
restricted to certain acts to the exclusion of all others.

Article 85
1-Every person attaining the legal age, enjoying full mental capacity and not interdicted shall be
considered of full capacity to exercise his rights provided for in this Law and all laws deriving therefrom.
2-A person shall be considered of full age if he completes twenty one lunar years.

Article 86

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1-Whoever is devoid of discernment because of age, imbecility or insanity shall not have the capacity to
exercise his civil rights.
2-A child below the age of seven shall be considered devoid of discernment.

Article 87
Whoever has attained the age of discernment but not the age of full capacity and whoever has attained the
legal age but is prodigal or simple-minded, shall be considered lacking capacity as determined by law.

Article 88
In matters of tutorship, guardianship or curatorship, incapacitated persons and those lacking capacity, as
the case may be, shall be subject to the conditions set forth in the law.

Article 89
No one may give up his personal freedom or capacity or modify the provisions thereof.

Article 90
Whoever has been subject of an unlawful infringement to one of the rights intrinsic to his personality may
ask for the cessation of such infringement and payment of damages for the prejudice sustained.

Article 91
Whoever is unjustifiably disputed in the use of his name, surname or both or if his name or surname, or
both, are misappropriated, may ask the cessation of this infringement and payment of damages for the
prejudice sustained.

SECTION TWO

JURISTIC PERSONS

Article 92
Juristic persons are:
a- The State, the Emirates, the municipalities and other administrative units within the conditions
determined by law.
b- Public Administrations, Services establishments and institutions endowed, by law, juristic personality.
c- Islamic organizations to which the State recognizes juristic personality.
d- Wakfs.
e- Civil and commercial companies with the exception of those excluded by a special law provision.
f- Private associations and institutions established in accordance with the law.
g- Any group of persons or property that the law endows with juristic personality.

Article 93
1-Within the limits set forth by law, a juristic person enjoys all rights except those inherent to the natural
characteristics of a human being.
2-It shall have:
a- An independent financial status.
b- Capacity within the limits specified in its constitution deed or as determined by law.
c- The right to sue.
d- An independent domicile. The domicile of a juristic person is the place where its administration set-up is
situated. The administration seat of juristic persons that have their principal office abroad but carry out

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activities within the State, shall, as regards the State Law, be the place where their local administration is
located.
3-It must have a representative to express its will.

Article 94
Juristic persons are governed by their specific law provisions.

CHAPTER FOUR

THINGS AND PROPERTY

Article 95
Property is any object or right that has a negotiable value.

Article 96
Property may or may not be outside the ambit of trade. Negotiable property is that which a Moslem may
legally enjoy and, non-negotiable, is that property which use is prohibited by law.

Article 97
Anything that may be subject to physical or legal possession, may be exploited lawfully and is not by
nature or by law non-negotiable can constitute the subject-matter or proprietary rights.

Article 98
Things that are outside the ambit of trade by their nature are those which may not be subject to exclusive
possession. Things that are outside the ambit of trade by law are those that the law forbids that they be the
object of proprietary rights.

Article 99
1-Fungibles are those things which units and parts are so close that one may customarily stand for the other
without any significant difference and which are estimated in dealings by number, measure, volume and
weight.
2-Non-fungibles are those which units are significantly different in characteristics and value or are rare in
circulation.

Article 100
1-Consumables are those things which specifications may not be effectively utilized only by consumption
or disposal.
2-Usable things are those which usufruct is materialized only by repeated use without affecting their
existence.

Article 101
Anything which is settled and fixed in space and cannot be moved without deterioration or alteration of its
shape is an immovable property. Any other thing is movable.

Article 102
An immovable property by destination is a movable put by its proprietor on a land he owns, destined for its
service or exploitation even though not permanently fixed to stay.

Article 103
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1-Public property consists of all movable or immovable properties owned by the State and public juristic
persons destined for public utility in fact or by virtue of a law.
2-This property may not, under all circumstances, be disposed of, seized or appropriated by prescription.

CHAPTER FIVE

THE RIGHT

SECTION ONE

SCOPE OF EXERCISING A RIGHT

Article 104
Legal allowance negates warranties, so who utilizes his right legally does not warrant remedying the
prejudice resulting therefrom.

Article 105
1-Sustenance of private harm is justified in order to avoid public prejudice.
2-A more severe prejudice is removed by sustaining a less severe one.

SECTION TWO

ABUSE OF THE EXERCISE OF A RIGHT

Article 106
1-Warranty is a must for whoever unlawfully uses his right.
2-Use of a right is unlawful when:
a- there is an intention to trespass;
b- the interests sought to be achieved by such use are contrary to the provisions of the Islamic Shari'a, the
law, public policy or morals ;
c- the expected interests are not commensurate with the prejudice sustained by other persons ;
d- it exceeds what is usually accepted by custom and usage.

SECTION THREE

DIFFERENT KINDS OF RIGHTS

Article 107
Rights are personal, real or moral.

Article 108
A personal right is a legal bond between a creditor and debtor where the former asks the latter to transfer a
real right, or the performance or forbearance of an act.

Article 109
1-A real right is a direct authority over a specific thing given by the Law to a specific person.
2-The real right may be principal or accessory.

Article 110

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1-Principal real rights are ownership, disposal, usufruct, use, lodging, shared occupation, easements, Wakf
and all what is so considered by law.
2-Accessory real rights are surety mortgage, possessory mortgage and privilege.

Article 111
1-Moral rights are those exercised over intangible things.
2-Copyrights, rights of inventors, artists, trademarks and all other moral rights are subject to special laws.

SECTION FOUR

PROOF OR RIGHTS
MEANS OF PROOF -1

Article 112
Means of proof are:
a- Writing.
b- Testimony.
c- Presumptions.
d- Eye-witnessing and expertise.
e- Avowal.
f- Oath.
GENERAL RULES OF EVIDENCE -2

Article 113
The onus of proof lies on the creditor, in establishing his right and on the debtor, in refuting it.

Article 114
Writing, testimony, irrefutable presumptions, eye-witnessing are means of proof with extensible effects,
while avowal only binds the acknowledger.

Article 115
Every testimony that includes drawing an advantage to the witness or repelling a detriment away from him,
shall be disregarded.

Article 116
The testimony of a dumb person and his oath, through his usual signs, shall be accepted if he ignores
writing.

Article 117
Burden of proof is on the claimant and oath on the denying.

Article 118
Evidence is used to prove the contrary of what is apparent and oath to corroborate what originally exists.

Article 119
Oath is accepted from the one who takes it in order to prove his innocence but not to obligate others.

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Article 120
1- Do not take an oath except on request of the opponent.
2- The judge may on his own direct the oath to one of the parties in one of the following instances :
a- Claim and prove that he has a right in an estate. He shall take oath that he apparently did not recover his
dues from the decedent and did not discharge him or transfer his right to someone else and the decedent does
not have a mortgage in consideration of this right.
b- There is evidence that he is entitled to a property, he takes an oath that he did not sell or donate it or that
title thereto was not transferred by any means whatsoever.
c- Return of a defective property, he takes oath that he did not accept the defect, in words or through a sign.
d- In case he is adjudged a preemptory right, he takes oath that he did not forfeit his preemptory right by
any means whatsoever.

Article 121
The statement of a translator registered in the ad hoc register shall, as regulated by law, be accepted

Article 122
No argument is accepted in case of contradiction. It shall not affect the court judgment if established
thereafter. The interested party may revert for warranty on the witness.
APPLICATION OF ROLES OF EVIDENCE -3

Article 123
Except where it is in conflict with the foregoing provisions, rules specified in the relevant special laws
shall be followed by the courts, as concerns rules and procedures of evidence as well as the conditions of
acceptance of evidence confirming the right.

BOOK ONE

PERSONAL OBLIGATIONS AND RIGHTS

CHAPTER ONE

SOURCES OF PERSONAL OBLIGATIONS AND RIGHTS

Article 124
Personal obligations or rights derive from the legal acts of disposal and facts and from the law. The sources
of obligations are:
1- The contract.
2- Unilateral act.
3- Tort.
4- The beneficial act.
5- The law.

CHAPTER ONE

THE CONTRACT

SECTION ONE

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GENERAL PROVISIONS

Article 125
A contract is the meeting of an offer issued by one of the contracting parties with the acceptance made by
the other party and their concordance in such a manner as to produce their effect on the object of the contract
and results in a binding obligation on each party in consideration of the obligation of the other party.
A meeting of more than two minds may agree to produce a legal effect.

Article 126
The object of a contract may consist of:
a- Property, movable or immovable, corporeal or incorporeal.
b- Usufruct of the property.
c- A specific act or service.
d- Any other thing that is not prohibited by law or violating public policy or morals.

Article 127
An offense or violation may not constitute the object of a contract.

Article 128
1-Nominate or innominate contracts are governed by the rules contained in this chapter.
2-Rules exclusively applicable to certain contracts are specified in the specified in the special provisions
regulating same, whether in this law or any other.

SECTION TWO

CONSTITUENTS, VALIDITY AND IMPLEMENTATION OF CONTRACTS AND THE

OPTIONS
FORMATION OF A CONTRACT -1

Article 129
The necessary elements for the formation of a contract are:
a- Meeting of minds of the contracting parties on the main elements.
b-The object of the contract must be something possible, specified or specifiable, and negotiable.
c-The obligations arising out of the contract must have a licit cause.

Article 130
A contract is formed by the meeting of an offer with an acceptance, with due observance of any special
conditions provided for in the law for its formation.

Article 131
The offer and acceptance are the expression of a will used for the formation of a contract. The one
expressed first is the offer and the second is the acceptance.

Article 132
Expression of the will may be verbal or in writing, whether in the past or present tenses or imperative
mood, if intended for immediate observation, or by signs customary followed, even from a non-dumb person,
or by effective exchange proving mutual assent or by taking any other attitude indicating beyond any doubt
mutual assent.

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Article 133
Future tense that denotes an absolute promise may form the contract as a binding promise, if so intended
by the contracting parties.

Article 134
1- Display of goods and services showing the consideration thereto is considered an offer.
2- Publication, advertising and lists of current prices as well as any other statement concerning offers or
requests addressed to the public or to individuals shall not, in case of doubt, be considered an offer but an
invitation to contract.

Article 135
1- No statement may be attributed to a silent person. However, circumstantial silence shall constitute
acceptance.
2- Silence shall amount to acceptance namely in case of previous dealings between the contracting parties
that are met by the offer made or where the offer is made to the benefit or the offeree.

Article 136
Following the offer and until the end of their meeting, the contracting parties have the option to accept or
reject it. The offer becomes invalid if withdrawn by the offeror after the offer but prior to acceptance, or if
one of the contracting parties states or does an act indicating retraction of the offer. Any statement made
thereafter is irrelevant.

Article 137
During the contract meeting, giving consideration to what is not meant by the parties is a relinquishment of
what was intended.

Article 138
Repetition of the offer prior to acceptance avoids the first offer. Only the second offer shall be taken into
consideration.

Article 139
1-Where a time is fixed for acceptance, the offeror is bound to maintain his offer until the expiry of the
period fixed.
2-The said time may be inferred from the surrounding circumstances, or from the nature of the transaction.

Article 140
1-Acceptance must be concordant with the offer.
2-Where the acceptance includes additions, restrictions or modifications to the offer, it shall be considered
a rejection that includes a new offer.

Article 141
1- A contract is not formed except through the agreement of the parties on the essential elements of the
obligation and on all the other legitimate conditions which the parties consider them to be essential.
2- Where the parties agree on the essential elements of the obligation and on all the other legitimate
conditions which the parties consider them to be essential, reserving some detailed to be agreed upon at a
later date and did not condition the formation of the contract on the agreement on these matters, the contract
is considered formed. Should any difference arise as to these pending details, the judge shall decide thereon
according to the nature of the transaction and the law provisions.

Article 142
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1-The contract between absent persons shall be considered formed at the place and time where and when
the offeror has knowledge of the acceptance, unless there is an agreement or a law provision to the contrary.
2-The offeror is considered to have taken knowledge of the acceptance at the place and time where and
when this acceptance has reached him, unless evidence to the contrary is established.

Article 143
Contract by telephone or any similar means shall, as to place be considered as made between parties who
are not present, in the same contract meeting, and, as to time, it shall be considered as formed between parties
present in the same meeting.

Article 144
Auction sales contracts are only formed by knocking down to the successful bidder. A bid is foreclosed by
a higher bid, even if invalid, and by closing the auction without it being knocked down to any bidder.

Article 145
Acceptance in contracts of adhesion is confined to adhesion to standard conditions laid down by the offeror
to all his customers and which are not subject to discussion.

Article 146
1-An agreement by which both or one of the parties undertake to enter into a specific contract in the future
shall not be formed unless it specifies all the material matters of the contract to be concluded and the period
set for its formation.
2-Where the law conditions the formation of a contract to a specific form, this form should be observed in
the agreement embodying a promise to enter into such a contract.

Article 147
Where a person promises to make a contract and then breaches his promise and is sued by the other party
claiming the fulfillment thereof, and where the conditions required for the formation of the contract, namely
those relating to form, are satisfied, the judgment when it becomes res judicata shall be a substitute for the
contract

Article 148
1-In the absence of a clause to the contrary in the contract, the payment of earnest money is evidence that
the contract has become final and may not be relinquished.
2-Where the parties agree that the earnest money paid is the sanction for withdrawal from the contract,
either party may withdraw. If the payor of the earnest money is the one who withdraws he shall loose it and
the person who has received the earnest money and withdraws from the contract shall repay double the
amount received.
REPRESENTATION IN CONTRACTING -2

Article 149
Unless the law otherwise provides, a contract may be made in person or through a representative.

Article 150
1-Representation in contract may be conventional or legal.
2-The proxy deed issued by the principal shall determine the authority of the proxy, when conventional,
and this authority shall be determined by the law, when legal.

Article 151
Whoever personally makes any contract for his own account he alone shall be bound by its provisions.
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Article 152
1-Where the contract is formed by way of representation, the person of the representative and not the
principal is taken into consideration when examining lack of consent or the effect of actual or supposed
knowledge of special circumstances.
2-Nevertheless, where the representative is an agent acting according to specific instructions issued by his
principal, the latter may not avail himself of the agent’s ignorance of circumstances known or should have
been known by him.

Article 153
Should the representative, within the powers of his representation, conclude a contract in the principal’s
name, the provisions of this contract and all ensuing rights and obligations shall accrue to the principal.

Article 154
If the contracting party does not disclose at the time of making the contract that he acts in his
representative capacity, the effect of the contract shall not ascribe to the principal, be he a creditor or a debtor,
unless it is supposed beyond doubt that the third party with whom the representative contracted has
knowledge of the existing representation or it is indifferent to him to contract with the principal or the
representative.

Article 155
Where both the representative and the other party who contracted with him ignore, at the moment of
making the contract, the expiry of the representation, the effect of the contract made by the representative
shall ascribe to the principal or his successors.

Article 156
Except where otherwise provided by law or by commercial rules, no one may contract with himself in the
name of his principal, whether the contract is for his own account or for that of another person, without
authorization from the principal. However, the principal may, in this case, ratify the contract.
CAPACITY TO CONTRACT -3

Article 157
Every person has capacity to contract unless such capacity is withdrawn or limited by law.

Article 158
The minor below the age of discernment has no right to dispose of his property and all his acts in this
respect are deemed to be void.

Article 159
1-Pecuniary dispositions of the discerning minor are valid, if totally beneficial to him, and void if entirely
detrimental.
2-All acts of disposition that may vary between being profitable or detrimental depend of the ratification of
the tutor, within the limits he initially is allowed to dispose of, or of the minor after attaining legal age.
3-The age of discernment is seven full Hegira years.

Article 160
1-The tutor has to authorize the minor who has completed eighteen Hegira years of age to take delivery for
administration purposes, of all or part of his property.
2-The court may, after hearing the guardian, authorize the minor who has completed eighteen Hegira years
of age to take delivery of all part of his property to administer it.
3-The Law shall determine the governing provisions in this respect.
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Article 161
The authorized minor, as concerns the acts falling within the authorization, shall be considered as a person
of full legal age.

Article 162
A minor whether under tutorship or guardianship, may not engage in trade unless he completes eighteen
Hegira years of age and has secured the full or restricted authority of the court in his respect.

Article 163
1-The judge may grant authorization to the discerning minor, in case the tutor withholds such
authorization; and the latter may not thereafter claim interdiction of the minor.
2-The judge may, after authorization restore interdiction on the minor.

Article 164
The tutor on the minor is his father then the tutor of the latter, the paternal grandfather, the judge or the
guardian appointed by him.

Article 165
The law shall determine the capacity required from the tutor to perform the tutorship rights on the property.

Article 166
Administration contracts made by the guardian on the minor's property are valid and effective in
accordance with the conditions and in the instances determined the law.

Article 167
Acts of disposition made by the guardian on the minor's property and which are not considered as acts of
administration are valid and effective in accordance with the conditions and in the instances determined by
law.

Article 168
1-Minors, insane and mentally deficient persons are interdicted per se.
2-Prodigal and irrational persons are interdicted by order of the judge. The interdiction shall be removed
according to the rules and procedures set forth in the law.
3-The order of interdiction shall be notified to the interdicted and the reason therefore shall be made
public.

Article 169
The interdicted insane persons and those mentally deficient of full legal age shall be treated as
incapacitated minors.

Article 170
1- Acts of disposition made by prodigals and irrational persons, pursuant to the registration of the
application or judgment of interdiction or to the application for reinstatement of tutorship or to the order of
imposing it anew, shall be governed by the same provisions as the dispositions made by persons lacking
capacity.
2- Acts of disposition prior to registration shall not be void or voidable unless they are made under
exploitation or through connivance.

Article 171

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1-The court may authorize the interdicted prodigal and irrational person to take possession of, and
administer, all or part of his properties.
2-The law shall determine the relevant provisions in this respect.

Article 172
The laws shall determine the procedures to be followed for interdiction, the administration of the interdict’s
properties, their exploitation or disposal thereof and all other matters related to tutorship, guardianship and
curatorship.

Article 173
If a person who is deaf/dumb, blind and deaf, or blind and mute, and for such reason unable to express his
will, the judge can appoint a judicial assistant to help him in such disposition, according to the manner
showed by the law.

Article 174
Acts performed by tutors, guardians and curators shall be valid within the limits set forth in the law.

Article 175
The person who lacks capacity and resorts to fraudulent means to cover his incapacity shall be liable to
damages.

DEFECTIVE ASSENT -4
A- DURESS

Article 176
Duress is a wrongful coercion by which a person is induced to do something without his consent. Duress
may be made by using violence or intimidation, physical or moral.

Article 177
Duress is violent where it threatens to inflict a serious and imminent danger to the person or to his
property; otherwise, if of a lesser degree, it is duress by intimidation.

Article 178
A Threat to inflict harm to a person's parents, children, spouse or sibling, as well as the threat of a risk
prejudicial to honor is considered duress that may, according to circumstances, be violent or by intimidation.

Article 179
Duress by violence nullifies consent and invalidates choice and duress by intimidation nullifies consent but
does not invalidate the choice.

Article 180
Duress varies according to the difference between persons, their age, weakness, ranks and the degree of
their affection and affliction from duress and from any other circumstance that may affect the seriousness
thereof.

Article 181
Duress is conditioned upon the author’s ability to execute his threats and the victim’s prevalent impression
that the constraint shall immediately materialize if he does not execute what he was forced to do.

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Article 182
Where the victim of one of the two kinds of duress is forced to make a contract is not enforceable, but it
becomes so if he or his heirs ratify it, expressly or impliedly, after the cessation of duress.

Article 183
Where the husband coerces his wife through beating her or forbidding her to see her parents, or doing any
similar act, in order to force her to assign to him one of her rights or donate a property to him, her act shall be
unenforceable.

Article 184
Where the coercion is issued by non-contractants; the person forced to enter into the contract must not
insist on the invalidity of the contract, unless it is proven that the other contractant had or was supposed to
have knowledge of such coercion.
B- DECEIT AND UNDUE INFLUENCE

Article 185
Deceit is the act by which one of the contracting parties deceives the other through the use of fraudulent
means, in words or other means, inducing him to assent to what he would have never consented to do in the
absence of such means.

Article 186
Deliberate silence on a fact or circumstance constitutes a deceit if it is established that the victim of deceit
would have not concluded the contract had he known of this fact or circumstance.

Article 187
Where one party, using undue influence, deceives the other party and it is established that the contract has
been made with an exorbitant hardship, the deceived party may rescind the contract.

Article 188
Exorbitant hardship in real or other property is the one that does not fall within expert’s appraisal.

Article 189
Where the property of the interdicted or the sick person on his death bed has been the objects of a
transaction tainted, even slightly, with undue influence and their debt cover all their belongings, the contract
is subject to removal of the hardship or acceptance by the creditors, otherwise it is void.

Article 190
If the deceit is perpetrated by other than the contracting party and the victim of such deceit establishes that
the other contracting party had knowledge of such deceit, he may rescind the contract.

Article 191
A contract made under exorbitant hardship but without deceit shall not be rescinded except as concerns the
property of the interdicted, the Wakf and the State.

Article 192
The right to rescind on grounds of deceit and exorbitant hardship shall be forfeited by the death of the
person entitled to ask for rescission, by disposing of the contract’s object, wholly or partially, through an act
indicating acceptance, or by having it perish in his possession, by consumption, defection or its increment.
C- MISTAKE
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Article 193
Mistake is not taken into consideration except where it occurs in the text of the contract or if revealed by
the surrounding circumstances and conditions, the nature of things and customs.

Article 194
Where the mistake occurs in the nature of the contract or in one of its formation conditions or in its object,
the contract shall be void.

Article 195
A contracting party may rescind the contract if he commits a mistake in a matter of substance such as the
object of the contract or in the person of the other contracting party or in one of his characteristics.

Article 196
Unless otherwise provided by law, a contracting party may rescind the contract if he makes a mistake of
law provided the conditions of mistake in facts are satisfied in accordance with articles 193 and 195.

Article 197
A mistake in calculation or writing, shall not affect the contract, but must be corrected.

Article 198
Whoever is under a mistake may not avail himself of it in a manner contradicting with the requirements of
good faith.
OBJECT AND CAUSE OF CONTRACT-5
A- OBJECT OF THE CONTRACT

Article 199
Every contract must have an object to be added to it.

Article 200
1-In pecuniary transactions, the object must be appraisable.
2-It may consist of a bare property, usufruct as it may consist of an act or abstention there from.

Article 201
Should the object be impossible in itself shall be impossible in itself, at the time of the contract, the
contract shall be void.

Article 202
1-In the absence of deceit, the object of financial transaction may be a future thing.
2-It is prohibited to deal with the inheritance of an alive person, even if with his own consent, unless in the
circumstances stipulated by the law.

Article 203
1-A designated object must be provided for financial compensation and negating flagrant ignorance, by
indicating its special location, if it is already existing by the time of the contract or the statement of its and
characteristic features, while mentioning its magnitude, if being an appraised thing or anything of the sort
which deny flagrant ignorance.
2-If the object is known to the contractants, then no need to describe it or define it otherwise.
3-If the object shall not be designated according to the above, the contract shall be null and void.
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Article 204
If the object to be disposed of or its consideration is an amount of money, its quantity and kind must be
determined. The currency fluctuation at the time of payment is immaterial.

Article 205
1-The object must be a thing that can be disposed of according to the terms of the contract.
2-Should the law forbid negotiating anything or should it be contrary to public policy or morals, the
contract is void.

Article 206
A contract may include a suitable condition which confirms it terms, admitted by custom or usage,
beneficial to one of the contracting parties or others unless it is prohibited by the legislator or contrary to
public policy or morals, in which case the condition is void but the contract remains valid except where the
condition is the prime motive of contracting and, in this case, the contract shall also be void.
B- CAUSE OF THE CONTRACT

Article 207
1-The cause shall be the direct intended purpose of the contract.
2-It must be existing, valid, lawful, and not inconsistent with public policy or morals.

Article 208
1-The contract is not valid unless it provides a lawful benefit to the contracting parties.
2-In contracts, the existence of such lawful benefit is supposed unless there is proof to the contrary.
VALID, VOID AND VOIDABLE CONTRACTS -6
A-THE VALID CONTRACT

Article 209
A contract is valid if licit in its essence and characterization, issued by a qualified person, having an object
that can be governed by the contract and an existing, valid and licit cause, validly specified and not subject to
a void condition.
B- THE VOID CONTRACT

Article 210
1-The void contract is the illicit one, by origin and description, due to a defect in one of its constitutive
elements, its object, purpose or the form imposed by law for its valid formation. This contract shall have no
effect and cannot be ratified.
2-Every interested party is entitled to invoke the invalidity, and the judge to decide it ex officio.
3-Action is nullity may not be heard after the lapse of fifteen years as of conclusion of the contract, but
every interested person may, at any time, raise a plea in voidance of the contract.

Article 211
1-Where a contract is partially void, the whole contract shall be void unless the share of each part is
determined, then the contract shall be void in that part and shall remain valid for the rest.
2-If the contract, in part of it, is suspended, this part shall remain so subject to its being authorized and,
when accepted, the whole contract shall be enforced, otherwise it shall be void in the suspended part alone to
the extent of its share in the consideration and shall be enforced in the other part to the extent of its share.
C- THE VOIDABLE CONTRACT
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Article 212
1-The voidable contract is licit in its essence but not in its characterization. It shall be valid once the cause
of its voidableness has ceased to exist.
2-Ownership of the object of the contract is not established unless upon receiving its value.
3-It shall have no effect except within the limits specified by law.
4-Each of the contracting parties or their heirs shall have the right to rescind the contract after notifying the
other party.
THE SUSPENDED CONTRACT AND NON-BINDING CONTRACT -7
A- THE SUSPENDED CONTRACT

Article 213
The implementation of a transaction shall be suspended until authorized, in case the author of the
transaction is a trespasser of another person’s property; or if he is the owner disposing of his property but
subject to a lien in favor of a third party; or where the author of the transaction is a minor disposing of his
property but his act is at the same time profitable and detrimental to him; or done by a person under duress;
or if the law so provides.

Article 214
Authorization of a contract shall be given to the owner, the owner of a right on the object of the contract,
the tutor or guardian or the minor himself when completing his capacity, the person under duress after
disappearance of coerxion, or the person specified by law.

Article 215
1-Authorization shall be by any act or words so indicating expressly or impliedly.
2-Silence shall be considered approval if customarily indicating assent.

Article 216
In order to be valid the authorization must concern a transaction that can be authorized, both at its
performance and at the moment of giving the authorization. Moreover, the beneficiary of this authorization,
the contracting parties and the object of the transaction must exist at the moment of granting it, in addition to
the consideration thereof in case it is in kind.

Article 217
1-Once authorized, the suspended act of disposition shall be enforced as at its inception and the subsequent
authorization shall be considered as a prior power of attorney.
2-Should authorization be withheld, the transaction is void.
B- THE NON-BINDING CONTRACT

Article 218
1-The contract shall be non binding with respect to one, or both, contracting parties, despite its validity and
enforceability, if the right of rescission is given without need to secure the approval of the other party or
resort to court.
2-Any of the two contracting parties has independently the right to rescind such contract if, by nature, it is
not binding to him or if he retained for himself the right to rescind it.
OPTIONS THAT IMPAIR THE BINDING EFFECT OF THE CONTRACT -8
A- THE CONDITION OPTION

Article 219
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In binding contracts but subject to rescission, the contracting parties may, both or one of them, stipulate
upon conclusion of the contract or subsequent thereto, a condition option for himself or for a third party
fixing the period within which the parties have to reach an agreement. Should they fail to fix such period, the
judge may fix it in accordance to custom.

Article 220
In financial transactions, if the condition option is stipulated in favor of both contracting parties, the two
considerations shall remain their respective property. In case the option condition is in favor of one of them,
his consideration shall remain his property and the consideration of the other party shall not accrue to him.

Article 221
1-The beneficiary of the option provision shall have the right to rescind the contract or approve it.
2- If he opts for approval, the contract shall be binding as of the time of its formation and if he opts for
rescission, the contract shall be rescinded, and considered as if it never existed.

Article 222
If the option is stipulated in favor of each of the contracting parties and one of them opts for rescission, the
contract shall be rescinded, even if the other party approves it, but if he opts for approval, the other party’s
option shall remain in effect during the option period.

Article 223
1-Rescission or approval shall be effective by any act or statement indicating any of them, explicitly or
implicitly.
2-If the period shall end, without electing approval or rescission, the contract becomes binding.

Article 224
1-The validity of rescission is conditioned upon electing it within the option period and the knowledge
thereof by the other party, if the rescission is verbal and is not conditioned by mutual assent or resorting to
court.
2-The approval, however, is not conditioned upon knowledge thereof by the other party.

Article 225
The option shall be forfeited by the death of the beneficiary thereof within the option period and the
contract shall be binding to his heirs, but the option of the other party shall remain open to him until the
expiry of the option period, provided he was given this option.
B- THE VIEWING OPTION

Article 226
The viewing option is given, in contracts that may be rescinded, to the party in favor of whom the act was
performed, even if he does not condition the contract upon such option, and if he did not see the object of the
contract which was only specified by description.

Article 227
The viewing option shall remain until viewing is achieved, within the agreed period, or forfeited.

Article 228
The viewing option shall not prevent the enforcement of the contract, but shall render it non binding with
respect to the party in favor of whom the option is given.

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Article 229
1-The viewing option may not be forfeited by surrender.
2-It shall be forfeited by viewing the object of contract, its express or implied acceptance, by the death of
the party having the option, total or by disposing of it by the beneficiary of the option in a way that does not
allow rescission or that gives right to others.

Article 230
Rescission, by viewing option, shall be accomplished by any action or statement that explicitly or
implicitly indicates it, provided that the other contracting party has had knowledge of it.
C- DESIGNATION OPTION

Article 231
It may be agreed that the object of contract would be one of two or three things, giving any of the
contracting parties to opt for one of these provided that the consideration for each and the option period are
stated.

Article 232
If both contracting parties do not fix the option period, or the period fixed for either party has elapsed
without exercising his option, the other party may ask the judge to fix the option period or the object of the
transaction.

Article 233
The contract shall not be binding to the party having the option until he exercises it. Once the express or
implied choice is made, the contract becomes enforceable and binding in accordance thereto.

Article 234
The effect of exercising the designation option goes back to the date of formation of the contract.

Article 235
1-If the designation option is given to the purchaser and one of the two things perishes in the hands of the
seller, the buyer, at his discretion, may take the other thing at its price or leave it. Should however the two
things perish, the sale is null and void.
If one of the two things under option perishes in the hands of the buyer, the perished thing is designated for
sale and the buyer is bound to pay its price and the other thing shall be held in trust.
If both things perish one after the other, the first one shall perish as a sold object, and the other as an object
under trust. If they perish simultaneously, the buyer is liable for half the price of each.
2-If the designation option is for the seller and one of the things under options perishes prior or after
receiving payment, the seller shall have the choice to bind the buyer to purchase the other thing or to rescind
the contract. However, if the two things perish before payment, the contract is void.
If both things perish successively, the first one shall perish in trust, and the second in sale. If both things
perish simultaneously, the buyer shall be liable for half the price of each.

Article 236
In case of death of the person for whom the option was given within the option period, his right shall
devolve to his heirs.
D- THE OPTION OF DEFECT

Article 237

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The right for rescission of the contract, under the option of defect, shall be operative in contracts, where
rescission is likely to occur, without stipulating it in the contract.

Article 238
The defect which makes the option operative must be old, affecting the value of the contract’s object,
unknown to the buyer and provided the seller did not specify the discharge thereof as a condition in the
contract.

Article 239
1-If the defect fulfills the conditions mentioned in the previous article, the contract shall not be binding to
the option holder before payment, and rescindable thereafter.
2-Rescission of the contract prior to receiving payment, with all what it entails, without need for consent or
court action provided that the other contracting party has knowledge thereof. After payment rescission shall
take place only by consent or by court action.

Article 240
Rescission of the contract on grounds of defect shall result in returning the object of the contract to its
owner and recovering what was paid.

Article 241
1-The defect option shall be forfeited by accepting the defect after knowledge of it, by disposing of the
contract’s object even before knowledge thereof, by its perishing or diminishing after payment or its
increment prior to payment in an uninterrupted manner but not generated from it due to an act of the
purchaser and, after payment if due to an act of the purchaser and, after payment if due to an independent
cause generated by it.
2-The defect option shall not be forfeited by the death of its holder, and shall be fixed for his heirs.

Article 242
The defect option holder shall have a possessory lien against the object of the contract, and a plea for
reduction of price.

SECTION THREE

EFFECT OF THE CONTRACT

BETWEEN CONTRACTING PARTIES -1

Article 243
1-Unless the law provides otherwise, the contract’s provisions apply on the object of the contract and its
consideration immediately upon its formation without making them dependant on payment or anything else.
2-As regards the contract's rights (obligations), each of the contracting parties shall fulfill what the contract
has bound him to do.

Article 244
The contract against consideration, concerning the usufruct of properties, once fulfilling the conditions of
its validity, shall establish the right of each of the contracting parties to the consideration received and shall
bind each one of them to deliver his property, object of the contract, to the other.

Article 245
The contract against consideration, concerning the usufruct of properties, once fulfilling the conditions of
its validity, binds the party disposing of the property to deliver it to the beneficiary of the usufruct and binds
the latter to hand over the usufruct consideration to the owner of the property.
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Article 246
1-The contract shall be implemented, according to the provisions contained therein and in a manner
consistent with the requirements of good faith.
2-The contract is not restricted to what is contained therein but shall extend to its essentials in accordance
with the law, custom and the nature of the transaction.

Article 247
In bilateral contracts, where the reciprocal obligations are due, each of the contracting parties shall have
the right to abstain from executing his obligation in case the other party does not honor his obligation.

Article 248
If the contract is one of adhesion, and includes arbitrary conditions, the judge may modify such conditions
or exempt the adherent, from it, according to the requirements of justice. Any agreement to the contrary shall
be void.

Article 249
1-If public exceptional unpredictable circumstances shall arise, and their happening has resulted in making
the execution of the contracted obligation, if not impossible, has become burdensome to the debtor in such a
manner as to threatening him with heavy loss, the judge may, according to circumstances and by comparing
the interests of both parties, reduce the burdensome obligation to reasonable limits, if justice so requires. Any
agreement to the contrary is void.
AS CONCERNS THIRD PARTIES -2

Article 250
Subject to the rules relating to successions, the effects of a contract shall apply to the contracting parties
and to their universal successors in title, unless it follows from the contract, the nature of the transaction or a
law provision that such effect shall not apply to the universal successors in title.

Article 251
Personal rights created by the contract relating to a property that has subsequently been transferred to a
particular successor, shall devolve to this successor at the same time as the transfer of title to the property, if
it is an essential element thereto and if the particular successor in title had knowledge of these rights at the
time of the transfer of the property to him.

Article 252
The contract does not impose any obligation on third parties, but may establish a right in their favor.

Article 253
A person who binds himself to procure the performance of an obligation by a third party does not in so
doing bind the third party. If the third party refuses to perform the obligation, the person who engaged
himself to obtain such performance shall be liable to pay damages to the other contracting parties.
He may avoid paying damages by performing himself the obligation he undertook to procure.
Where the third party consents to perform the obligation, his consent is effective only from the time that it
is given, unless it is indicated that he intended expressly or impliedly that the consent is retrospective as from
the time of issuing the undertaking.

Article 254
1-A person may contract in his own name rights for the benefit of a third party if he has a personal interest,
material or moral, in its performance.

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2-As a result of such stipulation and in the absence of an agreement to the contrary, the third party acquires
a direct right against the person who undertook to perform such stipulation, and may call upon him to do so.
The person who gave the undertaking may set up against the beneficiary the defences arising out of the
contract.
3-The stipulator may also claim the performance of the stipulation made in favor of the beneficiary, unless
it appears from the contract that the beneficiary alone has the right to do so.

Article 255
1-The stipulator himself, but not his creditors or heirs, may revoke the stipulation, provided that the
revocation is made before the beneficiary notifies the author of the undertaking or the stipulator of his wish to
benefit from it, unless this is contrary to the requirements of the contract.
2-In the absence of any express or implied agreement to the contrary, the revocation does not liberate the
author of the undertaking vis-à-vis the stipulator.
The stipulator may substitute a new beneficiary in place of the former beneficiary or may retain for himself
the benefit of the stipulation.

Article 256
In a stipulation made in favor of a third party, the beneficiary may be a future person or body, as he may be
a person or body who is not identified at the time of contracting, provided that he can be identified at the time
when the effects of the contract come into operation in accordance with the stipulation.

SECTION FOUR

INTERPRETATION OF CONTRACTS

Article 257
The principle in contracts is the assent of the parties and the contractual obligations they are bound to
perform.

Article 258
1-In contracts, purposes and meanings are decisive, not the wording or construction forms.
2-True meaning is the basis of words. A word shall not bear a metaphor unless it is impossible to construe
them according to their true meaning.

Article 259
Implicit indications shall not have no bearing vis-à-vis express statements.

Article 260
Giving effect to uttered words is prevalent over neglecting them, but if this is impossible then they should
be neglected.

Article 261
Stating part of what is indivisible is like stating the whole.

Article 262
The absolute shall be given effect without limitation unless it is limited by an express provision or tacitly.

Article 263
Description of what is present is futile and of what is absent is to be considered.

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Article 264
Among merchants, known practices are alike agreed conditions.

Article 265
1-When the wording of a contract is clear, it cannot be deviated from in order to ascertain by means of
interpretation the intention of the contracting parties.
2- Where the contract has to be construed, it is necessary to ascertain the common intention of the
contracting parties and to go beyond the literal meaning of the words, taking into account the nature of the
transaction as well as that loyalty and confidence which should exist between the parties in accordance with
commercial usage.

Article 266
1-In cases of doubt, the construction shall be in favor of the debtor.
2-The construction, however, of obscure expressions in adhesion contracts must be detrimental to the
adhering party.

SECTION FIVE

DISSOLUTION OF CONTRACTS
GENERAL PROVISIONS -1

Article 267
If a contract is valid and binding, none of the contracting parties may revoke, modify or rescind it except
by mutual consent, order of the court or a law provision.

Article 268
Subsequent to the formation of the contract, the contracting parties may dissolve the contract by mutual
agreement.

Article 269
Dissolution, as concerns the rights of contracting parties, amounts to rescission and, as concerns third
parties’ rights, a new contract.

Article 270
Dissolution shall occur between present persons through offer and acceptance and by negotiating provided
that the object of the contract does exist and is in the hands of the concerned party at the moment of
dissolution. If this object has partially perished, dissolution applies proportionately on the other part.

Article 271
The parties may agree that in case of non-performance of the obligations deriving from the contract, the
contract will be deemed to have been “ipso facto” without need to obtain a court order. Such an agreement
does not release the parties from the obligation of serving a formal notification, unless the parties agree that
such notification is dispensed with.

Article 272
1-In bilateral contracts, if one of the parties does not perform his contractual obligations, the other party
may, after serving a formal notification to the debtor, demand the performance of the contract or its
rescission.
2-The judge may order the debtor immediate performance of the contract or grant him specified additional
time, as he may order rescission with damages, in any case, if deemed justified.
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Article 273
1-In bilateral contracts, if a force majeure arises that makes the performance of the obligation impossible,
the corresponding obligation shall, be extinguished and the contract ipso facto rescinded.
2-If the impossibility is partial, the consideration for the impossible part shall be extinguished. This shall
also apply on the provisional impossibility in continuous contracts. In both instances the creditor may rescind
the contract provided the debtor has knowledge thereof.
EFFECTS OF CONTRACT'S DISSOLUTION -2

Article 274
When a contract is or shall be rescinded, the two contracting parties shall be reinstated to their former
position, prior to contracting, and in case this is impossible, the Court may award damages.

Article 275
If the contract is dissolved on grounds of nullity, rescission or for any other reason, and both contracting
parties have to return what they have taken possession of, each one of them may retain what he has received,
as long as the other party did not restitute what he has received from him, or did not submit a guarantee for
its restitution.

CHAPTER TWO

UNILATERAL ACT OF DISPOSITION

Article 276
Unless otherwise provided by law, the act of disposition may be unilateral, without being dependant on the
acceptance of the beneficiary of such act, unless it contains an obligation to third parties under the law.

Article 277
Unless otherwise provided by law, the unilateral act of disposition shall be governed by the provisions
applicable to contracts except those pertaining to the meeting of two minds required for the formation of the
contract.

Article 278
If the constitutive element of a unilateral act of disposition is present and it has fulfilled its conditions, the
author of the act may not withdraw there from, unless otherwise provided by law.

Article 279
1-If the unilateral act of disposition is an act of proprietorship it shall be binding to the alienee unless he
accepts it.
2-If the act is a forfeiture embodying owenership or a discharge of a debt it shall be binding upon the
alienee but it may be revoked within the meeting.
3-If it is a mere forfeiture, it shall be binding upon the alienee and may not be revoked.
4-All the above shall be effective unless otherwise provided by law.

Article 280
1-A promise is what the promisor imposes on himself in future for the benefit of others, not as a pecuniary
obligation but its object may be a contract or an act.
2-The promise binds the promisor except in case or his death bankruptcy.

Article 281
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1-A person who makes a promise to the public of a reward in exchange for a specified service and fixes a
specific period of time, is bound to give the reward to the person who performs the service, even if he acted
without giving consideration to the promise of reward.
2-Where the promisor does not fix a period of time for the performance of the service he may withdraw his
promise through a notice to the public provided that his notice does not affect the rights of a person who has
already performed the service prior to such withdrawal. The right of action for the reward will be forfeited, if
such action is not lodged within three months from the date of publication of the notice of withdrawal.

CHAPTER THREE

TORT

SECTION ONE

GENERAL PROVISIONS

Article 282
The author of any tort, even if not discerning, shall be bound to repair the prejudice.

Article 283
1-Tort shall be committed by perpetration or by causation.
2-If committed by perpetration, he is unconditionally bound to repair the prejudice and, if by causation, it
is conditional upon transgression premeditation or if the act caused the prejudice.

Article 284
If the perpetration and the causation are both present, the act shall be considered as committed by
perpetration.

Article 285
If any person shall mislead another, he shall be liable for reparation of the prejudice resulting from
misleading.

Article 286
Whoever had his property damaged by someone else, shall not damage the property of the latter, otherwise
each shall be liable to make good what he had damaged.

Article 287
In the absence of a provision in the law or an agreement to the contrary, a person is not liable for reparation
if he proves that the prejudice resulted from a cause beyond his control such as a heavenly blight, unforeseen
circumstances, force majeure, the fault of others or of the victim.

Article 288
Whoever causes an injury to another in legitimate defense of his person, honor or property or, of the
person, honor or property of others, is not responsible, provided that he does not exceed the measures
necessary for his defense, as otherwise he will be liable to damages for this excess.

Article 289
1-The act is the responsibility of the doer and not of the one who ordered it, unless the doer was compelled
to act. Compulsion that is taken into consideration must amount to imminent duress.

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2-Notwithstanding the above, a public servant is not responsible of his acts that injured third persons if he
acted in compliance to an order given by his superior whenever he was under duty to comply with, or if he
believed so and establishes that his belief of the legality of his act is based on reasonable grounds and that he
observed the precautionary measures in performing his act.

Article 290
The judge may reduce the amount of damages, or not allow any, if the injured has contributed, by his
action, in the happening of such injury or in its increase.

Article 291
When several persons are responsible for a prejudicial act, each one of them is responsible for his share in
it and the judge may decide to allot the liability equally between them or consider them jointly and severally
responsible.

Article 292
Damages shall, under all circumstances, be assessed to cover the prejudice sustained and the lost profit
provided it is a natural consequence of the prejudicial act.

Article 293
1-Damages shall include moral damages. Shall be considered moral damages, trespassing against others in
their freedom, honor, dignity reputation social standing or financial position.
2-Spouses and closet relatives of the family may be adjudged damages for the moral prejudice sustained by
them as a result of the death of the injured.
3-Recovery of moral damages is not transferable to others unless its amount is fixed by agreement or a
final court judgment.

Article 294
Damages may be paid by installments, as it may consist of a regular periodical payment and, in either
cases, the debtor may be ordered to provide a deposit in guarantee assessed by the judge, or an acceptable
security.

Article 295
Damages will consist of a money payment. Upon request of the victim, however, the judge may, in
accordance with the circumstances, order that the damage be made good by restoring the parties to their
original status, or by performing, in compensation, a specific matter connected with the prejudicial act.

Article 296
Any condition exonerating from tort liability shall be deemed null and void.

Article 297
Civil liability, once its conditions fulfilled, shall not impair criminal responsibility, and the criminal penalty
shall have no bearing on determining the scope of civil liability and the assessment of damages.

Article 298
1-An action for damages arising from an unlawful act is prescribed after three years from the date upon
which the victim knew of the injury and the identity of the person who was responsible.
2-Where a claim arises out of a criminal offense and the hearing of the penal action is still pending after the
lapse of the periods above-mentioned in the preceding clause, the action for damages may still be heard.
3-An action for damages is prescribed in any case after fifteen years from the date on which the prejudicial
act was committed.

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SECTION TWO

LIABILITY ARISING FROM PERSONAL ACTS

INJURY TO THE PERSON-1

Article 299
Damages are compulsory due for prejudice to the person.
Unless otherwise agreed between the parties, either blood money or compensation for defect of sold value,
in cases they are due, may not be added to damages.
DAMAGE TO PROPERTY -2

Article 300
Without prejudice to the general provisions on damages, whoever damages or destroys the property of
another, shall be liable to replace it, if fungible, or pay its value, if ad valorem.

Article 301
Without prejudice to the general provisions on damages, in case the damage is partial, the perpetrator shall
be liable to compensate the loss in value and in case it is a gross damage, the property owner may opt either
to receive the value of the damaged part or abandon the property and take its value.

Article 302
1-If one destroys the property of others pretending that it is his own, shall be liable to damages for what he
has destroyed.
2-Should he destroy the property of another, with his permission, he shall not be liable for damages.

Article 303
If an infant, whether discerning or not, or the like, shall destroy the property of others, he shall be
responsible in his personal funds.
EXTORTION AND TRANSGRESSION -3

Article 304
1-The hand that has taken is liable until it gives it back.
2- The one who extorts the property of another shall have to restore it back in the same condition in which
it was at the time of extortion, and at the same place where extortion occurred.
3-Should he consume, destroy, lose it or if it has been destroyed due to his transgression or without it, he
shall have to replace it or pay its value, on date, and at the place, of extortion.
4- He shall also bear liability of its profits and increments.

Article 305
If one shall destroy the extorted property while under the control of the extortioner, the victim of extortion
shall have, at discretion, the option to recover the damages from the extortioner and this latter may go back
on the author of destruction, or recover damages from this latter who, in this case, has no right to revert on
the extortioner.

Article 306
If the extortioner has disposed of the extorted property, with or without consideration, and such exorted
property shall be destroyed, in whole or in part, while under the control of the person in favor of whom the
act of disposition was made, the victim of extortion may opt either to claim damages from either one. So, if

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he recovers damages from the first, the act of disposition is valid, and if he recovers from the second, the
latter may revert on the extortioner in accordance with the law provisions.

Article 307
1-The extortioner of the extortioner shall be treated as extortioner.
2-If the extortioner of the first extortioner shall return back the extorted property to the first extortioner, he
shall be alone discharged and if he returns it to the victim of extortion he and the first extertioner shall be
discharged.
3-If the extorted property is damaged or has been destroyed while under the control of the extortioner, the
victim of extortion shall have the option to claim compensation from the first extortioner, or if he so wishes,
from the second extortioner.
He may also claim damages from the first for part of the damaged property and from the second for the
other part. So if he is compensated by the first extortioner, this latter may revert back against the second
extertioner and if compensated by the second, the latter may not revert on the first.

Article 308
Under all circumstances, the judge shall, if he deems it justified, condemn the extortioner to pay damages
as deemed adequate by him.

Article 309
Whoever has under his custody an object and neglected its protection, transgressed it, or unduly deprived
its owner from it, denied it or died without declaring it, shall be liable to replace it or pay its value, according
to the circumstances.

Article 310
Whoever has taken possession of money, by larceny or highway robbery and seized money, shall have to
restore to its owner, if still existing, replace it or pay its value, if it has been consumed, and even if he has
been sentenced.

Article 311
1-If the extorted object has undergone self change, the usurped person shall have an option either to
recover it or receive a similar object in replacement.
2- If the extorted object shall change, in such a way as to change its name, the extortioner is liable to
replace it.
3-If the extorted property shall change by the addition made by the extortioner out of his own money, the
extorted person shall have the option either to pay the added value and recover the extorted object in in kind,
or hold the extortioner liable to provide its substitute.
4-If the extorted property shall change by reduction in its value as a result of its utilization by the
extortioner, he shall be liable to return the property back and pay the reduction in value.

Article 312
Whatever amounts to extortion shall be treated as such.

SECTION THREE

LIABILITY ARISING FROM THE ACTS OF OTHERS

Article 313
1- No one is liable for the act of another person, however, upon request of the victim, the judge, if he
deems it justified, shall order any of the following persons, as the case may be, to pay the damages to which
the tort doer has been sentenced:

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a-The person who is, by law or by agreement entrusted with the supervision of a person who, on account of
his minority or his mental or physical condition, requires supervision, unless he proves that he has fulfilled
his duty of supervision, or if the prejudice would have been anyhow sustained even if he has fulfilled his duty
with the required care.
b- The one having actual authority to control and guide the tort doer, even if he was not free in his choice,
if the tort was perpetrated by a subordinate in the exercise of his duty or because of it.
2-The one who settled the damages is entitled to revert on the person sentenced for payment thereof, in
order to recover what he has paid.

SECTION FOUR

LIABILITY ARISING FROM ANIMALS AND THINGS,

AND THE USE OF PUBLIC ROAD

ANIMALS -1

Article 314
The felony caused by an animal is punishable, but the liability for the prejudice caused is on the one having
control over it, whether being its owner or not if due to his negligence or transgression.
THE COLLAPSE OF BUILDINGS -2

Article 315
1-The injury to others caused by the collapse of a building, in whole or in part, is the liability of its owner
or the person in charge of it, unless he proves that he is not a trespasser or negligent.
2-Whoever is in danger of damage from a building is entitled to call on the owner to take the necessary
precautions to prevent the danger, and if the owner fails to take such precautions, to obtain an order from the
court authorizing him to take the necessary precautions himself at the cost of the owner.
THINGS AND MACHINERY-3

Article 316
Whoever is in charge of a thing whose supervision requires special care in order to protect him from its
danger, or of a machine, is liable for damage caused by these things or machines except that which, without
prejudice to any special provisions in this respect.
USE OF PUBLIC RIGHT -4

Article 317
The use of a public right is limited by the safety of others.So, if the user of a public right causes to third
persons a prejudice which cannot be prevented, by incurs liability.

CHAPTER FOUR

BENEFICIAL ACT

SECTION ONE

ENRICHMENT WITHOUT CAUSE

Article 318
No one is entitled, without cause, to enrich himself to the detriment of another person, without just cause.
If he does so, he is liable to restitute it.
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Article 319
1-Unless otherwise provided by law, whoever enriches without just cause, is bound to restitute what he
obtained, if existing, or replacement thereof of its value, if not existing.
2-If one, unintentionally, loses control over his property, which was merged by accident with the property
of somebody else, in such a manner as it cannot be separated without prejudice to any of the owners, then the
property of lesser value shall follow the one with greater value, after settlement of its price. If both are equal
in value, they shall be sold for their account, and the price thereof shall be equally divided and distributed
among them, unless otherwise stipulated by Law.

SECTION TWO

PAYMENT NOT DUE

Article 320
Whoever gives something, being under the belief that he is under duty to do so, but it was later revealed
that it is not due by him, he is entitled to recover it from the one who received it, if existing, or a similar thing
in replacement thereof or its value, if not existing.

Article 321
A payment which was not due may be recovered, if it was made in the performance of an obligation whose
cause had not materialized or had ceased to exist.

Article 322
Restitution may also be made of a payment effected in the performance of an obligation which had not at
the time matured, if the payor was not aware that payment was not then due.

Article 323
If settlement has been made by other than the debtor and in consequence of this payment the creditor,
acting in good faith, has given up his document of title or security obtained, or allowed his claim against the
real debtor to be prescribed, he is not bound to restitute what he has received and the real debtor must
indemnity the payor, if appropriate.

Article 324
Whoever unduly receives that which is not due to him, he is bound to restitute it to the payor together with
the profits and interests. The judge may indemnify the right owner of what he has failed by neglect to collect
at that time.

SECTION THREE

VOLUNTARY AGENCY

Article 325
Whoever does a beneficial act to a third person without being ordered by him, but authorized by the judge,
commanded by necessity or imposed by custom, he is considered his agent and is governed by the following
provisions.

Article 326
The rules of mandate apply, if the person whom the voluntary agent acts ratifies his act.

Article 327

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A voluntary agent must continue work he has commenced until the person for whom he acts is in a position
to do so himself. He must also, as soon as he is able to do so, inform the person for whom he acts of his
intervention.

Article 328
The voluntary is responsible to indemnify the person for whom he acts for the prejudice sustained by the
latter and, if circumstances so justify, the judge has to assess the amount of the indemnity.

Article 329
When the voluntary agent delegates to a third party the whole or part of the work, he shall be responsible
for the acts of his delegate, without prejudice to the right of the person for whom he acts to have a direct
recourse on this delegate.

Article 330
The voluntary is bound by the same obligations as a mandatory as regards the restitution of that which he
received as a result of the voluntary agency and must submit an account for his acts.

Article 331
The person for whom the voluntary agent has acted will be bound to carry out the obligations entered into
on his behalf by the voluntary agent, to indemnify him against all undertakings assumed by him, to reimburse
him monies usefully or necessarily expended by him which are justified by the circumstances, and to
indemnify him in respect of any loss he has suffered as a result of his management. The voluntary agent is
not entitled to any remuneration for his work unless the work falls within the scope of his professional
business.

Article 332
1-If the events of the death of a voluntary agent, his heirs are bound by the same obligations as those of a
mandatory upon his death.
2-In the event of the death of the person for whom he acts, the voluntary agent is bound by the same
obligations to the heirs as he was to the person of whom they were the successors in title.

SECTION FOUR

REIMBURSEMENT OF THIRD PARTIES DEBTS

Article 333
Whoever reimburses the debt of another, upon his order, is entitled to revert on the person giving the order
for what he has paid on his behalf and shall substitute the original creditor in his claim of the debt from the
debtor whether he the right of reversion is specifically provided for or not.

Article 334
Whoever fulfills the debt of another without his order is neither entitled to revert for what he has paid on
the debtor, except in the instances provided for in Article 325, nor revert on the creditor unless this latter
discharges the debtor from the debt even after recovering his debt from the payor.

Article 335
If a mortgagor settles the debt of somebody else, to liberate his mortgaged property in security for such
debt, he is entitled to revert on the debtor for what the amount settled by him.

SECTION FIVE

JOINT PROVISION
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Article 336
The claim arising, from a beneficial act, shall not be heard after the lapse of three years from the date on
which the creditor had knowledge of his right of reversion, and in any case fifteen years from the day on
which the right arose.

CHAPTER FIVE

THE LAW

Article 337
Rights whish are directly and solely arising from law are governed by the provisions of the law giving right
to such rights.

TITLE TWO

THE EFFECTS OF A RIGHT

CHAPTER ONE

GENERAL PROVISIONS

Article 338
A right must be settled whenever its legal maturity conditions are satisfied. If the debtor is in default, the
right shall be compulsory enforced, either in kind or through payment of an indemnity, in conformity with the
law provisions.

Article 339
1-Implementation shall be willful if it is done by settlement or its equivalent.
2-It shall be forced if settled in kind or through compensation.

Article 340
In case a right loses, for any reason whatsoever, the protection of the law, it may not be forcibly enforced
and becomes a natural obligation against the debtor.

Article 341
If the debtor settles a natural obligation, his settlement shall be valid and not considered a payment which
is not due.

CHAPTER TWO

ENFORCEMENT MEANS

SECTION ONE

WILLFUL ENFORCEMENT
SETTLEMENT -1
A- PARTIES TO THE SETTLEMENT
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Article 342
1-Payment may be made by the debtor, his agent, or any other interested person.
2-It is also valid if made by a person having no interest in doing so, whether pursuant to an order of the
debtor or without such order, the creditor may, however, refuse settlement from a third party in case the
debtor objected to such payment and notified his objection to the creditor.

Article 343
As a condition to be discharged from a debt, the payor must be the owner of what he settled. In the event
the debtor is a discerning minor, an imbecile of legal age or, a prodigal under custody, and pays the debt he
owes, his payment is valid unless it is detrimental to the payor.

Article 344
Payment to some creditors shall not be effective as concerns the other creditors, if the debtor is interdicted
and pays the debt that caused interdiction or sick in his last illness and the payment is detrimental to the other
creditors.
B- THE PAYEE

Article 345
Payment shall be made to the creditors or his representative. Shall be considered qualified to recover the
debt, whoever presents to the debtor a discharge issued by the creditor, unless it is agreed that payment shall
be made to the creditor in person.

Article 346
If the creditor lacks full legal capacity, the debtor shall not be discharged unless by settlement to his
guardian. In the event that settlement is made to the creditor and the object of settlement perishes in his
hands, or is lost by him, the guardian may claim the debt from the debtor.
C- REJECTION OF SETTLEMENT

Article 347
If the creditor unjustifiably refuses to accept the duly offered settlement, where acceptance is a must, or
abstain from performing the acts without which settlement is not complete, or has declared that he will not
accept the settlement, the debtor shall notify him with a warning and fix to him an adequate delay to perform
what he has to do in order to recover his right.

Article 348
Notification of the creditor shall result in putting the object of the obligation under the guarantee of the
creditor, if it was previously under the guarantee of the debtor, and the debtor shall be entitled to deposit it on
the creditor's expense and be compensated for the damages sustained.

Article 349
If the object of settlement is a per se specified thing, and it had to be delivered at the place where it is
located, the debtor may, after warning the creditor to take delivery thereof, obtain the judge's permission to
deposit it. Should this object be an immovable property or is destined to stay where it is, the debtor may ask
that it be put under sequestration.

Article 350
If the object of settlement is quickly perishable, or requires heavy costs to be deposited or sequestrated, the
debtor may, with the judge's permission, or without it when necessary, sell it at its market price if possible
otherwise it shall be sold by public auction. Depositing its price shall be equal to depositing the thing itself.

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Article 351
Deposit or an equivalent procedure may also be acceptable if the debtor ignores the identity or residence of
the debtor, if the creditor is interdicted and has no representative to accept the settlement on his behalf, or that
the debt was subject of disputed between several persons, or there were other serious causes that justify such
a procedure.

Article 352
As regards the debtor, a duly made offer shall stand in place of settlement if followed by a deposit
satisfying its legal requirements, a similar procedure if accepted by the creditor, or validated by a final
judgment.

Article 353
1-If the debtor offers settlement of the debt, and follows such an offer by a deposit or similar procedure, he
may withdraw such an offer, as long as it is not accepted by the creditor, or is not validated by a final court
decision has been issued for its validity. Should he withdraw his offer, neither his partners in the debt nor his
guarantors shall be discharged.
2-If the debtor shall withdraw his offer, after being accepted by the creditor, or validated by a court
decision, issued for its validity, and the creditor has accepted such withdrawal, the creditor may not,
afterwards adhere to the securities guaranteeing his right thereto and the partners in the debt, as well as the
guarantors shall be discharged.
D- OBJECT OF SETTLEMENT, ITS TIME, PLACE, EXPENSES AND
PROOF

Article 354
1-If the debt is identified by designation, the debtor may not settle a substitute thereto without the consent
of the creditor, even if such substitute is equal in price to the thing due, or be of a higher value.
2-If however the debt is not identifiable by designation, the debtor may settle it with a similar thing even if
not accepted by the creditor.

Article 355
1-In the absence of an agreement or provision allowing it, the debtor may not force the creditor to accept
partial payment of his right.
2-If the debt is disputed in part thereof, and the creditor accepts the settlement of the approved portion, the
debtor may not refuse settlement of the undisputed part.

Article 356
If the debtor is under obligation to settle, with the debt, any expenses and what he has paid does not settle
the debt in addition to such expenses, the amount settled shall, unless otherwise agreed, be deducted from the
expense account then from the principal amount of the debt.

Article 357
If the debts, owned by the debtor are several, and they were all due to only one creditor, and of one kind,
and what the debtor paid does not cover all such debts, the debtor may upon settlement specify the debt he
wishes to settle first as long as there is no legal or conventional impediment that prevents such designation.

Article 358
If the debt is not specified in the manner stated in the preceding Article, the payment shall be deducted
from the debt falling due. In case there are several matured debts, deduction shall apply to the most
burdensome on the debtor and if all are equally burdensome then from the debt specified by the creditor.

Article 359
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1-In the absence of an agreement or a provision to the contrary, settlement must take place immediately
once the obligation is finally due on the debtor.
2-Unless prevented by a law provision, the judge may, however and in exceptional cases, give the debtor a
reasonable delay, or delays, within which he has to execute his obligation, that is if his condition so requires,
and if the creditor shall not sustain from such postponement a serious damage.

Article 360
1-If the debt was deferred, the debtor may pay it before its maturity date if this is in his interest, and the
creditor is bound to accept such payment.
2-If the debtor settles the debt before maturity date, then what was received as payment matures, the debt
shall reinstate its postponed status as it previously was.

Article 361
1-Unless otherwise agreed or stipulated, if the object of obligation was specified by designation, it must be
delivered at the place where it was at the time when the obligation was born.
2-In the other obligations, settlement shall be at the place where the residence of the debtor is, at the time
of settlement, or in the place where the main office of the business of the debtor is, if the obligation was
related to such business.

Article 362
If the debtor shall send with his messenger the debt to his creditor and if perished while under the control
of such messenger, before reaching the creditor, then such perished debt shall encumber the debtor's assets. If
the creditor orders the debtor to settle the debt to his messenger and the latter does so, then its perishing shall
be supported by the assets of the creditor and the debtor shall be discharged from the debt.

Article 363
Unless otherwise provided by law, the settlement expenses shall be assumed by the debtor.

Article 364
1-The one who settles a part of the debt has to ask for a discharge for what he has settled, together with
endorsing the debt instrument that such settlement has been effected. If he pays all the debt, he is entitled to
ask for the restitution of the debt instrument or its cancellation.
If the debt instrument was lost, he shall have to ask the creditor to confirm, in writing, the loss of such
instrument.
2- If the creditor refuses to carry out what he has been bound to fulfill as per the preceding paragraph, the
debtor may deposit the object of the due debt with the court.
PERFORMANCE EQUIVALENT TO SETTLEMENT -2
A- SUBSTITUTE SETTLEMENT

Article 365
The creditor may accept, as settlement for his debt, something else, or a legal right to be settled by the
debtor. Such agreement, for substitute settlement shall be governed by the general provisions concerning the
contracts provided for in this Law.

Article 366
1-The substitute settlement shall be governed by the sale provisions, if the substitute is a specific property
in lieu of the debt.
2-It shall be subject to the provisions for the payment in discharge of the debt.

Article 367
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The first debt shall be extinguished together with its securities in case of substitute settlement, and the right
of the creditor shall be transferred to the substitute.
B- COMPENSATION

Article 368
Offsetting is the settlement of a debt due to a creditor, against a debt owned by him to his debtor.

Article 369
Offsetting is either compulsory, and takes place by the power of law, or facultative, carried out by
agreement of both parties, or judicial carried out by decision of the judge.

Article 370
The forced offset requires that each of the parties be a creditor and debtor for the other, and that both debts
be similar in kind, description, maturity, force and weakness, and further provided that applying such offset
does not prejudice the rights of third parties regardless of whether the two debts have the same cause or
different ones.

Article 371
Conventional offset may be performed even in the absence of one of the conditions required for forced
offset.

Article 372
The judicial offset, if fulfilling its conditions, shall be carried out by decision of the judge, upon an original
or incidental request.

Article 373
If the depositary is indebted to the depositor, or an usurper is indebted to the owner of the usurped
property, and the debt was of the same nature as that of the depositor usurped property, the offsetting shall not
take place except by agreement of both parties.

Article 374
If a creditor destroys a property owned by the debtor, the debt shall be forfeited if the destroyed property is
of the same kind as the debt, otherwise offset shall apply only by agreement of both parties thereto.

Article 375
Offsetting shall be carried out upon request of the interested party and within the limits of the smaller of
the two debts.

Article 376
If at the time the offsetting is sought, the court action is barred by prescription, this shall not prevent
carrying out the offsetting as long as the period preventing the action to be heard did not lapse at the time the
offset was still possible.

Article 377
If a debtor pays his debt, while he could have asked the offset with a right owned by him, he may not
adhere to the securities pertaining to this right to the prejudice of third parties unless he had justifiable reason
to ignore its existence.
C-MERGER

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Article 378
1-When the qualities of creditor and debtor in the same debt are united in the same person, the debt is
extinguished to the extent of the merger.
2-There is no merger when the creditor is a heir to the debtor and participates with the other creditors in
order to recover his debt from the estate.

Article 379
When the cause which gave rise to the merger disappears retrospectively, the debt is reinstated to its former
status.

SECTION TWO

FORCED IMPLEMENTATION
EXECUTION IN KIND -1

Article 380
1-The debtor shall be compelled, upon being duly summoned to perform his obligation in kind, whenever
possible.
2-When, however, specific performance is too onerous for the debtor, the judge may, upon request of the
debtor, limit the creditor's right to a sum of money as substitute, if such performance does not seriously
prejudice the creditor.

Article 381
1-When the object of the right is the doing of an act, and the nature thereof or the agreement demands that
it be performed by the debtor in person, the creditor may refuse the performance of the obligation by any
other person.
2-In the case of non-performance by the debtor of an obligation to do something, the creditor may request
the authorization of the judge to carry out the obligation. He may, in case of urgency, perform it without
authorization from the judge. In both cases, performance shall be carried out at the expense of the debtor.

Article 382
When the nature of the obligation so permits, a judgment may, in case of an obligation to do something,
take the place of the performance.

Article 383
1-Unless otherwise provided by law or stipulated in the agreement, a debtor who is required to preserve a
thing, to manage it or to act with prudence in the performance of his obligation he brings to the performance
thereof the care of a reasonable person, even if the object in view is not achieved.
2-Under all circumstances, the debtor remains liable for fraud or gross negligence.

Article 384
When a debtor infringes an obligation to refrain from doing something the creditor may demand the
suppression of that which he has done in contravention of his obligation. The creditor may apply to the judge
for an order authorizing him to proceed himself with such suppression at the expense of the debtor.

Article 385
After specific performance has been carried out or when a debtor has persisted in his refusal to perform the
obligation, the judge shall fix the amount of damages that the debtor is bound to pay, taking into
consideration the prejudice suffered by the creditor and the unjustifiable attitude of the debtor.
COMPENSATION IN LIEU OF PERFORMANCE -2
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Article 386
When the specific performance by the debtor is impossible, he will be condemned to pay damages for non-
performance of his obligation, unless he establishes that the impossibility of performance arose from a cause
beyond his control. The same principle applies, if the debtor is late in the performance of his obligation.

Article 387
Unless otherwise provided in the law or stipulated in the contract, damages are not due unless the debtor
has been formally summoned.

Article 388
A formal summons to the debtor will not be necessary in the following instances:
a-If the execution of the obligation becomes impossible or useless due to some act of the debtor.
b-If the object of the obligation is the payment of damages in respect of an illicit act.
c- If the object of the obligation is the restitution of a thing that the debtor knew to have been stolen or of a
thing that he received knowing that it was not due to him.
d-If the debtor declares, in writing, that he does not want to perform his obligation.

Article 389
If the event that the amount of damages is not fixed by law or in contract, the judge will assess it to be
commensurate with the prejudice effectively sustained when it occurred.

Article 390
1-The two contracting parties may fix, in advance, the amount of damages either in the contract or in a
subsequent agreement subject to the law provisions.
2-The judge may, in all cases, at the request of one of the parties, amend such an agreement, in order to
make the amount assessed equal to the prejudice. Any agreement to the contrary is void.

SECTION THREE

LICIT MEANS TO SECURE PERFORMANCE

THE DEBTOR'S PROPERTY AS SECURITY FOR PAYMENT -1

Article 391
1-All the debtor's properties shall be held as security for reimbursing his debts.
2-Without prejudice to the law provisions in this respect, all creditors have equal ranks as concerns this
security.
INDIRECT ACTION -2

Article 392
1-Every creditor, even if his right has not fallen due, may exercise in the name of his debtor all his debtor's
rights save only those that are purely personal or cannot be attached.
2-The exercise by a creditor of the rights of his debtor is not admissible, unless the creditor proves that the
debtor himself has not exercised such rights and that the debtor's failure to do so is such as to result in or
increase his bankruptcy. The debtor's forced intervention in the court action is a must.

Article 393
A creditor, in the exercise of his debtor's right, is deemed the debtor's representative. The benefits resulting
from the exercise of such rights fall into the patrimonium of the debtor and serve as a security to all his
creditors.
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ACTION IN SIMULATION -3

Article 394
1-If a simulated contract has been concluded, creditors of the contracting parties and particular successors
in title may, if they are in good faith, avail themselves of the hidden contract and establish, by any means, the
simulation of the contract by which they were prejudiced.
2-If the case of a conflict of interest between the interested parties, some of whom rely upon the ostensible
contract and others on the hidden contract, the former shall have preference.

Article 395
When the contracting parties hide a genuine contract behind an ostensible contract, the genuine contract
will bind the contracting parties and their universal successors in title.
NON-OPPOSABILITY OF THE DEBTOR'S ACT TO THE CREDITOR -4

Article 396
If the actual or deferred debt covers the debtor's patrimonium, whether by adding or being equal to it, the
debtor is prohibited to give as donation what he is not bound to donate or not customarily accepted. The
creditor may ask the court to order that such act is not opposable to him.

Article 397
If the creditors shall claim the debtor, whose debt, exhausted his patrimonium, the latter may not donate his
property or dispose of it against consideration, even without favoritism. The creditors are entitled to ask the
court to order the non-opposability of such act to them, the sale of his property and set-off their rights from
the proceeds of the sale, according to the law.

Article 398
If the creditor pretends that his debt covers the entire patrimonium of the debtor, he has only to prove the
amount of debts owed to him and the debtor shall have to establish that the property he owns exceeds in
value the amount of the debt.

Article 399
Whenever the act has been declared non-opposable, the creditors who have been prejudiced by such act
shall benefit of this dicision.

Article 400
1-The claim of non-opposability of the act may not be heard after the lapse of three years from the day the
creditor had knowledge of the cause of non-opposability.
2-This claim shall not, under all circumstances, be heard after the lapse of fifteen years as of the
performance of such act.
INTERDICTION OF THE BANKRUPT DEBTOR -5

Article 401
Interdiction may be imposed on the debtor whenever his due debts exceed in value his patrimonium.

Article 402
1-Upon request of the debtor or one of the creditors, interdiction shall be adjudicated by the judge of the
domicile of the debtor. The case shall be examined summarily.
2- Any of the creditors may obtain, by virtue of the interdiction order, a decision from the competent judge
to attach all the possessions of the debtor, except those that may not be attached. Attachment shall remain in
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effect on the debtor's property in favor of the creditors until the removal of the attachment.

Article 403
The judge has, in every case before interdicting the debtor, to consider in his assessment all the debtor's
surrounding circumstances, the extent of his responsibility for the causes, that led to the request for
interdiction, the lawful interests of his creditors and every other circumstance that may affect his financial
status.

Article 404
1-On the day of entry of the interdiction case, the court clerk must record the contents of such case in a
special register, the decision rendered in the case, and every other judgment confirming or canceling the said
decision, on the same day the judgment is given.
2- The clerk shall also dispatch, to the bureau of the Ministry of Justice, a copy of such registrations and
endorsements, to be recorded in the General Register, organized according to a decision to be issued by the
Minister.

Article 405
In case of change of domicile, the debtor has to inform of this change the clerk of the court of his previous
domicile. Upon taking knowledge of this change of domicile, whether informed by the debtor or advised by
any other means, the clerk has to send copy of the interdiction order, as well as of the information endorsed
on the margin of the registration, to the court in which jurisdiction falls the new domicile, in order to record
same in its registers.

Article 406
The interdiction shall entail the following:
1-Mature all deferred debts due by the debtor.
2-The debtor's acts of disposition, of his existing assets or the ones to exist at a future date, shall not be
opposable to all his creditors.
3-As of the registration of the contents of the lawsuit, his acknowledgment of a debt to another person shall
be of no effect.

Article 407
If the debtor is interdicted, the president of the competent court shall, upon a petition submitted by the
debtor, decide to grant him a subsidy to be taken from his own funds. An opposition may be filed against the
decision taken on the petition within three days from the date it is rendered, if filed by the debtor, or from
notifying such decision to the creditors if the opposition is submitted by them.

Article 408
The assets of the interdicted debtor shall be sold, and the proceeds allotted between the creditors to be set-
off the debts, in accordance with the procedures provided for in the law, leaving a sufficient amount for the
subsidy to be paid to him an to those depending of him.

Article 409
The debtor shall be sanctioned for fraud in the following instances:
1-If a case has been filled against him for a debt, and he intentionally has been declared bankrupt, to cause
prejudice to his creditors and the case ended up by adjudicating the debt and the interdiction.
2-If he has concealed, after he has been condemned to interdiction, some of his possessions to prevent
taking execution measures thereon; or has fabricated false or exaggerated debts, with the intention of causing
prejudice to his creditors.
3-If he has fraudulently changed his domicile, which resulted into a detriment to his creditors.

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Article 410
1- Interdiction shall be removed by a court judgment, rendered by the judge of the debtor's domicile, upon
application submitted by any interested person, in the following instances:
a- If the assets of the interdicted have been allotted between the creditors.
b-If it is established that the debts of the debtor have become less than his assets.
c- If the debtor settles his matured debts that did not mature because of the interdiction, and, in this case,
the due dates of the debts shall be reinstated to their previous status provided the debtor has paid all due
installments.
2- The court clerk, on his own initiative, shall annotate, in the margin of the registration provided for in
article 404, the judgment terminating the interdiction and shall send copy thereof to the cabinet of the
minister of Justice for further annotation.

Article 411
Interdiction shall be terminated ipso jure after the lapse of five from the date of endorsement of slaughter.

Article 412
The debtor may, after the termination of interdiction, ask that the debts which were due because of
interdiction, and were not settled on their maturity date, return to their previous due dates, provided that he
had settled his debts that became due for a reason other than interdiction.

Article 413
Termination of interdiction shall not prevent creditors from challenging the debtor's acts, or availing
himself of using his rights in accordance with articles 392, and from 394 to 400.
RIGHT OF RETENTION -6

Article 414
Whoever is under an obligation to supply something may refrain from performing his obligation so long as
his creditor does no offer to perform an obligation incumbent on him arising out of the obligation of the
debtor and connected therewith.

Article 415
Each of the contracting parties in bilateral financial transactions in general may retain the object of the
contract, while in his hands, until he receives the due consideration.

Article 416
Whoever spends on someone else's property, while in his possession, necessary or useful expenses is
entitled to abstain from restituting it until he recovers what is legally due to him; unless otherwise agreed or
provided in the law.

Article 417
1-Whoever retains the thing must preserve it, and must render an account of its fruits.
2- 2-If the thing retained is of a perishable nature or susceptible of deterioration, the person who retains the
thing may obtain from the judge authorization to sell it in accordance with the procedures followed in the sale
of a pledge property. The right of retention will then be transferred to the price thereof.

Article 418
Whoever retains a thing by using his right of retention shall have priority, on all other competing creditors,
to recover his right from such thing.

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Article 419
1-Unless otherwise provided in the law, the right of retention is extinguished by the fact of the thing
ceasing to be in the hands of the possessor or the holder.
2-Nevertheless, the person retaining the thing, who has lost possession thereof without his knowledge or in
spite of his opposition, may claim restitution of the thing within a period of thirty days from the time he
became aware of the loss of possession, but prior to the lapse of one year since the date of the loss.

CHAPTER THREE

ACTS SUBJECTS TO SUSPENSIVE CONDITIONS AND TIME CLAUSES

SECTION ONE

CONDITION

Article 420
The condition is a future fact upon which the existence of the act or its extinction depends on its
materialization.

Article 421
The absolute act is that which is achieved in an absolute and unconditional manner without being deferred
to future time and occurs instantly.

Article 422
A suspended act is that which is tied up by a non materialized condition, or a future event, and its effect
shall be postponed until the condition is materialized.

Article 423
In order that suspension be valid, the context of the condition must neither be materialized or impossible.

Article 424
The act is void when the condition on which it depends is impossible, contrary to religious precepts, public
policy or morality.

Article 425
The act depending of a suspensive condition, that is not inconsistent with the contract, is not executory
unless after materialization of the condition.

Article 426
The act shall cease to exist when the condition to which it is subject materializes. The creditor is bound to
return what he took and in case this is impossible because of him, he is bound to compensate.

Article 427
That which is subject to a suspensive condition is established upon materialization of the condition.

Article 428
The condition must as much as possible, be observed.

SECTION TWO
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TIME CLAUSES

Article 429
The act may be added to a term which, when due, shall result in the determination of the rules of its
effectiveness and extinguishment.

Article 430
When it results from the act that the debtor shall only perform it when he is able, or has the means, to do
so, the judge will fix a reasonable time for the term, taking into account the actual and future resources of the
debtor and allowing for the diligence of a man anxious to perform his obligation.

Article 431
A debtor will forfeit the benefit of the term in the following instances:
1-If he is declared bankrupt or interdict.
2-If he does not supply the security of the debt as agreed upon.
3-If he has, by his own act or for a reason beyond his control, diminished the real securities of the debt,
unless he proceeds to complete same.

Article 432
If the term is for the benefit of one of the parties, he may give it up by his own unilateral will.

Article 433
The term debt will not become due by the death of the debtor unless it is guaranteed by a real security.

CHAPTER FOUR

PLURALITY OF THE OBJECT OF AN ACT

SECTION ONE

ALTERNATIVE OBJECTS

Article 434
The object of an act may be several things and the debtor is entirely discharged if he performs one of these.
The option, in the absence of any special provision in the law or clause in the agreement to the contrary,
belongs to the debtor, if absolute. The object of the act is subject to the provisions applicable to the option of
designation.

SECTION TWO

EXCHANGE OF THE OBJECT

Article 435
1-The act is substitutive if its object is a single thing and the debtor will be discharged if he gives as
substitute another thing.
2-The original alone, not the substitute, shall be the object of obligation, and will determine its nature.

CHAPTER FIVE

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PLURALITY OF PARTIES TO AN ACT

SECTION ONE

SOLIDARITY BETWEEN CREDITORS

Article 436
Solidarity between creditors shall not exist unless by agreement or by a law provision.

Article 437
The debtor may settle his debt to any of the joint creditors, unless one of them notifies him that he will not
accept payment.

Article 438
If a debtor is released of his debt to one of his joint and several creditors for a reason other than
performance, he shall be released as regards the other creditors only up to the amount of the share of the
creditor to whom he is no longer liable.

Article 439
1-Joint creditors may claim the debt from the debtor either jointly or severally.
2-The debtor may not be opposed to the debt of one of his joint creditors on grounds specific to another
creditor. He may, in his opposition, raise the grounds specific to this creditor or the grounds common to all
other creditors.

Article 440
All that which a joint creditor receives on account of the debt reverts to all creditors and will be divided
equally between them, unless otherwise provided by law or agreed between them.

SECTION TWO

JOINT DEBT

Article 441
A debt is joint when its cause and the cause of another debt are united, if the debt has devolved by
inheritance to several heirs, a commonly consummated property or the substitute of a loan taken from
common property.

Article 442
Each partner in the common debt may claim his share in it and that what he received will be considered
property common between all partners, each in proportion of his share.

Article 443
1-If one of the two partners receives part of the joint debt, the other party has to make him participate in it
proportionately to his share. They both may sue the debtor for his share.
2-If a partner chooses to sue the debtor, he may not turn back on his partner unless his share has perished,
and only to the extent of what he received.

Article 444
1-If one of the partners receives his share in the joint debt, then disposed of it or consumed it, the other
partners are entitled to claim their share in it.
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2-If it perishes while in his possession without negligence from his part, he is not liable to answer for the
shares of his partners in it. In this case, he has received his share and the balance of the debt owed by the
debtor will be due to his other partners.

Article 445
If one of the partners obtains from the debtor a guarantor for his share in the joint debt, or if the debtor
refers him to his assignee, the other partners will participate with him, within the limits of their shares, in the
amount received from the guarantor or the assignee.

Article 446
If one of the partners purchases, against his share in a joint debt, a thing owned by the debtor, the other
partners may hold him liable to compensate within the limits of the portion of the price taken from their
shares, or revert on the debtor to the extent of their shares. They may also, if they agree, participate in the
ownership of what their partner bought.

Article 447
A partner may donate his portion in the debt to the debtor or release him thereof, without having to
compensate his partners for what he has donated or released.

Article 448
One of the partners in the joint debt may reach a compromise for his share therein, thus if the consideration
for the compromise is of the same kind of the debt, the other partners may either share in what was received
or sue the debtor. If, however, the consideration for the compromise is of a kind different from that of the
debt, they may sue the debtor or the compromising partner who will have to pay them their share in what he
received or their share in the debt.

Article 449
1-None of the partners in a joint debt may defer it alone without the consent of the others for such deferral.
2-He may defer his share without the consent of the others and, in this case, he shall not share with them
what they will receive out of the debt.

SECTION THREE

SOLIDARITY BETWEEN DEBTORS

Article 450
Solidarity between debtors will only take place unless by agreement or by a law provision.

Article 451
If one of the joint debtors settles the debt in full, the others are released.

Article 452
1-The creditor has to claim his debt from all his joint debtors, or some of them, taking into consideration
the ensuing characterization of his relation with every creditor that may affect the debt.
2-Every debtor, when asked to pay, is entitled to file an opposition on grounds that are only special to him
or common with the other debtors.

Article 453
If a creditor reaches an agreement with one of the joint debtors for a substitute settlement, the others shall
be discharged unless he reserved his right vis-à-vis all of them.

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Article 454
Should the share of one of the joint debtors be extinguished for a reason other than settlement, it shall not
be extinguished as concerns the other debtors except to the extent of the debtor's share in the debt.

Article 455
If the creditor does not agree to release all the rest of the joint debtors from the debt, he shall only be
entitled to claim the balance of the debt after deducting the share of the debtor who has been released by him,
unless he reserved his right to revert on them for the entire debt and, in this case, they shall be entitled to sue
the debtor to the extent of his share in the debt.

Article 456
Unless otherwise agreed, should the creditor release one of the joint debtors from solidarity, his right to
revert on the others for the entire debt shall remain.

Article 457
If the creditor releases one of the joint debtors from the debt or from solidarity, the remaining debtors may
revert on such debtor within the limits of his share in the proceeds of the debtor among them who has been
declared bankrupt. However, if the creditor has released such debtor from all liability from the debt, then the
creditor shall bear the share of this debtor in the proceeds of the bankrupted debtor.

Article 458
1-The non-admission for hearing the case on grounds of prescription, as concerns one of the joint debtors
shall not benefit the other debtors except within the limits of the share of such debtor.
2-Should the time limitation be interrupted or cut-off as concerns one of the joint debtors, the creditor may
not avail himself of this against the others.

Article 459
In the performance of his obligation, the joint debtor is held liable for his act and, if summoned or sued by
the creditor, this shall have no bearing as concerns the other debtors. Summons served by one of the joint
debtors to the creditor shall, however, benefit the other joint debtors.

Article 460
The reconciliation reached between one of the joint debtors and the creditor shall not be executory if it
results into adding a new obligation on the debtors, or increased their existing obligation, unless they accept
it. They shall benefit from the reconciliation if it includes release from the debt or discharge by any other
means.

Article 461
Acknowledgment of the debt by a joint debtor shall not be binding on the others. If one of the joint debtors
refuses to take an oath tendered by the creditor, or if he tenders the oath to the creditor and the latter takes the
oath, the oath refused or tendered will not prejudice the other joint debtors. However, in case the creditor
tenders an oath to the debtor who takes it, the other debtors shall benefit from such oath.

Article 462
A judgment given against one of the joint debtors will have no effect against the others, but they shall
benefit from it if given in favor of such debtor, unless the judgment is based on a ground relating only to him.

Article 463
The joint debtor, from among the others, who settles the debt will have a claim against each of the others to
the extent of his share. If one of the joint debtors is declared bankrupt, he will bear with the solvent joint

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debtors the consequences of such bankruptcy, without prejudice to revert on the bankrupt debtor when he
becomes solvent.

Article 464
If one of the joint debtors is the principal debtor in the debt, while the remaining debtors are guarantors, he
shall not have any claim against them.

SECTION FOUR

INDIVISIBILITY

Article 465
An act cannot be divided when it has for its object something which by its nature is not susceptible of
division, or if the intention of the parties that it should not be divided.

Article 466
1-When there are several creditors in respect of an indivisible act, or there are several heirs to the creditor
in this same act, each creditor or heir may claim the satisfaction of his right in full.
2- If one of these contests, the debtor shall have to fulfill his obligation to all of them together or deposit
the object of the obligation with the competent authority, according to what is required by the law.
3-Each of the creditors shall have recourse against the creditor who has received payment.

Article 467
1-When there are several debtors in respect of an indivisible act, each one of them is liable for the debt in
full.
2-The debtor who has paid the debt shall have recourse against the others, each one for his share.

CHAPTER SIX

EXTINCTION OF THE RIGHT

SECTION ONE

DISCHARGE

Article 468
In case the creditor willingly discharges his debtor from a right he has on him, the right is extinguished.

Article 469
Discharge is not dependant on the debtor's acceptance but shall be void if refused by him and, if the debtor
dies before acceptance, the debt shall not encumber his estate.

Article 470
The discharge is valid if given for an existing debt and not for a future one.

Article 471
1-Discharge is governed by the substantive provisions governing every donation.
2-No special form is required for discharge even if it is the release of an obligation whose existence was
conditional upon a special form imposed by law or agreed upon between the parties.

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SECTION TWO

IMPOSSIBILITY OF PERFORMANCE

Article 472
A right is extinguished if the debtor establishes that its performance has become impossible by reason of a
cause beyond his control.

SECTION THREE

EXTINCTIVE PRESCRIPTION

Article 473
A right shall not be extinguished by time limitation but the hearing of the court case, against the one who
denies it, shall not be admissible after the lapse of fifteen years without legal excuse, after due observance of
the matter governed by special provisions.

Article 474
1-A case concerning a claim of any periodical recurring right, when denied, shall not be heard after the
lapse of five years without legal excuse.
2-As concerns revenue due by a holder in bad faith, the case, against who denies it, may not be heard after
the lapse of fifteen years, without legal excuse.

Article 475
When denied and in the absence of a legal excuse, the case may not be heard after the lapse of five years,
as concerns the following rights.
1-Rights of physicians, pharmacists, lawyers, engineers, experts, professors, teachers and brokers, provided
that the debts are due as remuneration for work coming within the scope of their profession or in payment of
expenses incurred by them.
2-Taxes and fees due to be recovered, if such have been unduly paid, without prejudice to the provisions
stated in special laws.

Article 476
If denied and in the absence of a legal excuse, a case may not be heard after the lapse of two years if it
concerns a claim for the following rights:
a-The rights of merchants, manufacturers in respect of things supplied to persons who do not trade in such
things; rights of hotel and restaurant owners for the cost of accommodation and food and for expenses
incurred by them on behalf of their clients.
b-The rights of workmen, servants and wage earners in respect of their pay, daily or otherwise, and the cost
of supplies provided by them.

Article 477
1-In the instances mentioned in the preceding article, the case may not be heard even if the creditors are
still performing other works for the debtor.
2-In case an acknowledgment or an instrument is drawn-up embodying any of the rights referred to in
articles 474, 475 and 476, the case may not be heard after the lapse of fifteen years as of it becomes due.

Article 478
Prescription runs only from the day on which the debt becomes due and from the date on which the
condition is realized, if subject to a suspensive condition and, in case of an action on a warranty, from the
date its maturity is established.
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Article 479
A case shall not be heard if left by the predecessor then by the successor thereafter, if the total of the two
periods reach the period prescribed for its non admittance.

Article 480
The period of prescription barring the admittance of hearing the case is calculated in days; the first day
does not count and prescription is completed when the last day is at an end, unless it is an official holiday,
then it shall extend to the following day.

Article 481
1-Prescription barring the admittance of hearing the case is interrupted whenever there is a lawful excuse
barring claim of the right.
2-The period within which the excuse still exists shall not count in the calculation of the prescribed period
of prescription.

Article 482
If some of the heirs do not file a case claiming a right to their decedent, within the period prescribed for its
hearing, without a lawful excuse and, the remaining heirs have such an excuse, the case shall be heard on
prorate a basis of the latter's shares in the estate.

Article 483
Prescription prescribed for barring the non-admittance of hearing the case shall be interrupted by an
express or tacit admission of the right by the debtor.

Article 484
The period prescribed to bar the hearing of the case is interrupted by a court claim or any legal proceedings
instituted by he creditor claiming his right.

Article 485
1-If the period prescribed to bar the hearing of the case is interrupted, a new prescription period shall
commence and shall have the same duration as that of the former one.
2-The right of whatever kind is not subject to prescription if adjudicated by a final unchallengeable
judgment.

Article 486
The prescription barring the hearing of a case in which a right is claimed shall extinguish claiming the
accessories of this right even if the period of prescription prescribed to claim these accessories is not
completed.

Article 487
1-The plea of non-admittance to hear the case on grounds of prescription may not be renounced before
acquiring the right to submit such a plea. Likewise, it is not admitted to agree on a term of prescription other
than that fixed by law.
2-Every person, who is legally capable of disposing of his rights, may renounce, even tacitly, his right to
submit such a plea after being in a position to do so.

Article 488
1-The judge of his own initiative cannot decide not to hear the case on basis of prescription, but this must
be requested by the debtor or by any interested party.

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2-Prescription may be invoked at any stage of the proceedings unless the circumstances show that the
person entitled to raise such a plea has waived his right thereto expressly or tacitly.

BOOK TWO

CONTRACTS

TITLE ONE

PROPRIETARY CONTRACT

CHAPTER ONE

SALE AND BARTER

SECTION ONE

SALE
DEFINITION AND ELEMENTS OF SALE -1

Article 489
Sale is the exchange of non monetary property for a monetary property.

Article 490
1-It shall be provided that the sold be known for the buyer, such a knowledge that denies all flagrant
ignorance.
2-The sold to be known for the purchaser by the statement of its conditions, and typical characteristic
descriptions. If it is present it shall be sufficient to indicate it.

Article 491
If it shall be mentioned, in the contract, that the buyer had enough knowledge of the sold, he shall have no
right to annul the contract, for lack of knowledge, unless he proved that the seller has deceived him.

Article 492
1-If the sale is by a model, it shall be enough to be viewed, and the sold must be identical.
2-If the sold appeared to be not identical to the model, the buyer may opt to accept it or return it back.

Article 493
1-If both buyer and seller disagree as for the identification of the sold to the model, and the model and sold
present, the experts' opinion shall prevail. If the model shall be lost while under the control of either buyer or
seller, the final word in identification or differentiation shall be for the other party, unless his adversary
proved the contrary.
2-Should the sample be in the hands of a third party, by mutual agreement of the parties, then it was lost,
and the thing sold was specifically designated, and there is no disagreement between the parties as to the
identity of the thing sold, the statement of the vendor on its conformity with the sample shall prevail. In case
the thing sold is specified or designated by its kind, and there is no agreement between the parties as to its
being the object of the sale, the statement of the purchaser on its non conformity with the sample shall
prevail, unless the vendor proves the contrary.
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Article 494
1-The sale may be conditioned upon trial for a fixed period which, if not specified in the contract, shall be
considered the usual period.
2-The vendor is bound to make the trial available to the purchaser.

Article 495
1-The purchaser may, within the testing period, accept such sale or refuse it, even if he did not try the thing
sold, provided that, in case of refusal, he gives notice to the vendor.
2-If the trial period has expired, and the vendor kept silent, while having the opportunity to try the thing
sold, his silence shall be considered acceptance, and the sale shall be binding on him.

Article 496
If the thing sold perishes while in the hands of the purchaser, pursuant to its receipt, he is bound to pay the
price agreed upon to the vendor; if it perishes prior to delivery for a reason beyond the purchaser's control, it
shall be on the responsibility of the vendor.

Article 497
The sale after trial and the acceptance of the thing sold shall be effective as of the date of the sale.

Article 498
If the purchaser becomes incapacitated prior to accepting the sale, his tutor or guardian must opt for what is
in his interest, taking into consideration the rules and conditions provided for in the law.

Article 499
If the purchaser dies before making his choice, while having a creditor whose debt covers his assets, the
right of trial shall pass to this creditor, otherwise it shall pass to his heirs. Therefore, in case they all agree to
accept the sale or to return the thing sold, their agreement shall be binding, and if some approve the sale and
the others reject it, restitution of the thing sold becomes a must.

Article 500
The purchaser may not use the thing sold within the trial period, except to the extent customarily required
for trial. If he uses it beyond this purpose for a reason other than trial, the sale becomes binding.

Article 501
The provisions governing the sale subject to trial shall apply to sale subject to testing except that the right
to tasting does not pass to the heirs and the sale becomes final.

Article 502
The proceeds of the thing sold accruing during the trial period shall be in favor of the vendor and its
expenses charged to him, except where the proceeds form part of the sale, in which case the purchaser shall
be entitled to theses proceeds if the sale is completed.

Article 503
The price is what both contracting parties have agreed upon in consideration of the sale, whether it exceeds
the value or is short therefrom. The value is what the thing has been assessed without increase or decrease.

Article 504
If both the vendor and the purchaser have mutually agreed upon fixing the price at the market value, such
shall be assessed at the time and place of sale. If there is no market in that place, reference should be made to
the market price at the place at which the prices and customarily deemed applicable.
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Article 505
If both parties declare a price other than the price agreed upon, the true price shall prevail.

Article 506
1-Sale may take place by adding a profit to the cost price, sell at a price lower than the cost price or at
exactly the cost price, provided the cost price is known at the time of the contract and the amount of profit, in
the sale for profit, and of loss, in the case of sale at a price lower than the cost price, is fixed.
2-If it appears that the seller made an over statement of the cost price, the purchaser is entitled to reduce
the price to the normal level.
3-If the cost price of the thing sold was unknown at the time of contract, the purchaser may rescind the
contract upon his knowledge thereof; the same shall apply if the vendor concealed a matter affecting the sale,
or the cost price, but this right shall be forfeited if the thing sold perished or was consummated, or if the
purchaser was dispossessed of its property after delivery.

Article 507
1-An increase in price made by the purchaser after the contract, if accepted by the vendor, shall be added to
the original contract and the fixed price together with the increase shall form the consideration for the whole
sale.
2-The reduction in price made by the vendor after the contract, if accepted by the purchaser, shall be made
part of the original contract and the balance of the price after reduction shall represent the contract price.

Article 508
The price shall be payable in advance unless agreed or customarily practiced that it be deferred or paid by
installment over a definite term.

Article 509
If payment of the price is deferred or done by installment, the term shall start from the date of delivery of
the thing sold.

Article 510
If the buyer shall pay a part of the price, he is not entitled to claim proportionate delivery of the thing sold
if splitting shall result in a reduction in its value.
EFFECTS OF SALE -2
A- OBLIGATION OF THE SELLER
FIRST – TRANSFER OF OWNERSHIP

Article 511
1-Unless otherwise agreed or stipulated by Law, ownership of the thing sold shall be transferred to the
purchaser once the sale has been completed.
2-Each of the parties to the sale has to fulfill his obligations except those deferred.

Article 512
When the goods are sold in bulk, ownership is transferred to the purchaser in the same way as ownership
of a definite specified thing.

Article 513
1-In a credit sale the vendor may stipulate that the transfer of ownership to the purchaser is subject to
integral payment of the price, even if the thing sold has been delivered.
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2- If the price has been fully paid, the purchaser's ownership shall be deemed to have taken place as from
the date of sale.

SECOND - DELIVERY OF THE THING SOLD

Article 514
The vendor is bound to deliver the thing sold to the purchaser free of any other right, unless otherwise
agreed or stipulated by Law. He is equally bound to perform everything necessary from his part to transfer
ownership to the purchaser.

Article 515
If, according to the Law or current custom, the nature of the thing sold, requires the delivery of his
ownership titles, the vendor is bound to deliver same to the purchaser. Should he refrain from delivering them
or pretend their loss, and then were found, the judge shall force him to deliver them. If they are not found in
case they are allegedly lost, the purchaser shall be at choice of returning the thing sold or resume the sale.

Article 516
The vendor is bound to deliver the thing sold to the purchaser in the state in which it was at the time of the
sale.

Article 517
Delivery includes delivery of the accessories of the thing sold and of all fixture thereon as well as
everything appropriated permanently for its use and everything else which, according to custom, as accessory
to the thing sold even if not mentioned in the contract.

Article 518
Contracting for construction or trees shall include the land on which the construction is erected, and the
land in which the roots of the trees extend. Likewise, contracting for a land shall include the constructions
and trees thereon, unless otherwise provided by contract or custom, a legal condition or custom requires
otherwise. Contracting for a house shall include all its fixed utilities to the exclusion of the movable ones,
unless it is specified by the purchaser that they be included in the contract.

Article 519
Unless otherwise specified as a condition or customarily accepted, the sale of land shall not include the
plants thereon.

Article 520
The sale of trees as such or as accessory to the land includes the produce that did not totally or mostly
develop shoots or buds but if it did, it is not covered by the contract unless its appendage to the root figures
as a condition or customarily accepted. In case each of the trees or plants have up to their half developed
shoots or buds, each shall follow the aforementioned rule.

Article 521
The contract that shall deal with plants taken by shearing shall not include the leftovers unless a condition
or custom provide otherwise.

Article 522
If the vendor duly delivers the sold item to the purchaser, he shall not be answerable for what shall happen
to it afterwards.

Article 523
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When the quantity of the thing sold is fixed in the contract and, in the absence of an agreement or custom,
a deficiency or increment in it shows, the following rules shall apply:
1-In case severance is not detrimental to the thing sold, the increase shall be in favor of the purchaser, who
is entitled to recover it in kind, and the deficiency recovered from his account whether the price is fixed by
unit or for the total of the thing sold.
If the thing sold shall be adversely affected by severance and the price is fixed per unit, the vendor is
entitled to the value of the increase and the deficiency charged to his account.
If, however, the named price covers the total value of the thing sold, the purchaser is entitled to the
increment while the price shall not apply to any deficient quantity.
2-If the thing sold shall be adversely affected by severance and the price is fixed per unit, the vendor is
entitled to the value of the increase and the deficiency charged to his account.
If, however, the named price covers the total value of the thing sold, the purchaser is entitled to the
increment while the price shall not apply to any deficient quantity.
3-If the increment or deficiency add to the obligation of the purchaser beyond what he has intended to
purchase or change the nature of the transaction, he may opt for the cancellation of the sale unless the
difference is trifle and it does not contradict the purpose sought by the purchaser.
4-In case the purchaser takes delivery of the thing sold with knowledge of the deficiency, he shall forfeit
his right to the cancellation option mentioned in the preceding paragraph.

Article 524
The case for rescinding the contract or reducing the price, or completing it, shall not be heard after the
lapse of one year as of delivery of the thing sold.

Article 525
1-Delivery of the thing sold may be completed in effect or by releasing it to the purchaser allowing him to
receive it and there is no hindrance to his possession thereof.
2-Delivery, of anything, is done in accordance with its nature, and according to the agreement or custom.

Article 526
When the thing sold was in the possession of the purchaser prior to the sale, in any capacity or for any
reason whatsoever, this possession is considered delivery, unless otherwise agreed.

Article 527
If both parties to the sale agree to consider, in a particular case, the purchaser having taken delivery of the
thing sold, or if the law orders considering some instances as delivery, the delivery shall be considered de
jure completed.

Article 528
Delivery is completed de jure by registration of the thing sold in the name of the purchaser, if the law
requires registration for the transfer of ownership.

Article 529
Delivery shall also be considered as having taken place de jure in the two following instances:
1-If the vendor keeps the thing sold with him at the request of the purchaser.
2-If the vendor notifies the purchaser (to pay the price and take delivery of the thing sold within a fixed
period otherwise it shall be considered delivered) and he did not.

Article 530
1-The vendor is bound to deliver the thing sold at the place where it is located at the time of contract.

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2-If the contract includes, or the custom requires, dispatching the thing sold to the purchaser, delivery shall
not be effective until the thing reaches him.

Article 531
1-If the thing sold perishes before delivery as a result of a cause beyond the control of either party to the
sale, the contract shall be dissolved and the price refunded to the purchaser.
2-If the thing sold perishes partially, the purchaser shall be at option either to rescind the sale or take the
remaining part against payment of its share of the price.

Article 532
1-If the thing sold perishes prior to delivery, or some of it damaged, by an act of the purchaser, he shall be
considered as having taken delivery of the thing sold and shall be bound to pay the price.
2-Should the vendor be, in this case, at option and chooses to rescind the sale, the purchaser shall warrant
to restitute in kind a similar thing or the payment of its price and appropriate what is left of it.

Article 533
1-If the thing sold perishes, before delivery, by the act of another person, the purchaser shall be at option
either to rescind the sale or, if he wishes, accept it and he shall be entitled to turn back against the responsible
person to warrant the restitution in kind of a similar thing or payment of its value.
2- If the thing sold perishes partially, the purchaser shall be at option to choose any of the following:
a- Rescind the sale.
b- Take the remainder against payment of its share in the price and the sale shall be rescinded as concerns
the perished portion.
c- Sign the contract for the whole sale at the named price and turn back on the responsible person to
compensate for the damaged part.

Article 534
1-The vendor warrants that the thing sold is free from any right to third persons encumbering the sale if the
cause of its becoming due precedes the sale contract.
2-The vendor's warranty remains in effect if the cause of maturity is due to an incident occurring after the
sale resulting from his act.

Article 535
1-Litigation concerning the recovery of the thing sold, before its delivery, shall be addressed to both the
purchaser and the vendor.
2-If the litigation arises pursuant to delivery of the thing sold and the purchaser did not ask, in due time, for
the forced intervention of the vendor in the action and a final judgment has been rendered against him, he
shall lose his right to demand the execution of the warranty in case the vendor establishes that his
intervention in the case would have resulted in the rejection of the action in recovery.

Article 536
1-If the action in recovery of the thing sold is decided, the recover may revert on the vendor for the price
should he authorize the sale and the purchaser shall be entitled to the thing sold.
2-If the recover did not accept the sale, the contract shall be rescinded and the purchaser shall revert on the
vendor for the price.
3-The vendor shall warrant to the purchaser any betterment introduced by him in the thing sold estimated
at its value on the date of its delivery to the recoverer.
4-The vendor shall also warrant to the purchaser the damages occurring from the recovery of the thing
sold, which rose by the fall due of the sold.

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Article 537
1-A clause providing for the exclusion of the vendor's warranty of the price upon recovery of the thing sold
is prohibited and shall annul the contract on account of such clause.
2-The knowledge of the purchaser, that the thing sold is not the property of the vendor, shall no to prevent
him from taking action as concerns the price upon recovery.

Article 538
If recovery is based on the avowal of the purchaser or his refraining to take oath, he may not take action
against the vendor.

Article 539
1-If the buyer compromises with the prospective recoverer payment of an amount of money prior to having
the latter obtain a judgment in his favor, and the vendor refutes the claimant's right, the purchaser shall then
have to prove that the claimant is entitled to his claim after which the vendor shall be at option either to
refund the consideration paid for the compromise or restitute the price to the purchaser.
2-If the compromise is reached takes place after adjudication in favor of the recoverer, the buyer shall keep
the thing sold and may take action against the vendor for the price.

Article 540
1-Should part of the thing sold be recovered prior to taking delivery by the purchaser of the whole thing, he
shall be at option either to restitute what he has received and recover the price thereof, or accept the sale and
take action as concerns the part recovered.
2-If part of the thing sold has been recovered after total delivery to the purchaser and caused a defect in the
other part, the purchaser has to restitute the remaining part and take action against the vendor for the price, or
adhere to it against payment of its share in the price. If, however, recovery did not cause a defect and the part
recovered is the smallest, the purchaser shall have no other remedy except to take action for the restitution of
the share of the recovered part in the price.
3-If, after sale, it is revealed that a right of a third party encumbers the thing sold, the purchaser shall be at
option either to wait until this lien is removed or rescind the sale and take action against the vendor for the
price.
4-In an easement, it is presumed that the vendor does not give a warrant if this easement is apparent or if
the vendor has revealed it to the purchaser.

Article 541
1-If the claim for recovery is made after the perishing of the thing sold while in the possession of the seller,
he shall warrant its value at date of purchase to the recoverer and action against the vendor for the price.
2-If the amount warranted by the purchaser exceeds the nominated price, he is entitled to take action for
the difference together with a warrant for damages due according to clause 4 of Article 536.

Article 542
The recoverer is entitled to claim from the purchaser the revenues or yields of the thing sold to the extent
benefited by him after deducting the expenses required for production and the purchaser shall take action
against the vendor to recover what he has paid to the recoverer.

THIRD - WARRANTY OF HIDDEN DEFECTS

)OPTION IN CASE OF DEFECT(

Article 543
1-The sale shall be considered concluded, on basis that the thing sold is free from defects other than those
customarily tolerated.

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2-The general rules concerning the option in case of defect shall govern the sale contract, taking into
consideration the dispositions of the following Articles.

Article 544
1-If an old defect appears in the thing sold, the purchaser shall be at option either to restitute it, or accept it
at the nominated price, but he may not retain it and claim the amount of the decrease in price due to the
defect.
2-The defect is considered old if it was existing in the sold before sale, or happened after sale while still
under the control of the seller before delivery.
3-The defect occurring upon purchase shall be considered as old if based on a previously existing cause in
the thing sold while in the hands of the vendor.
4-The old defect is conditioned upon being occult. A defect is occult when it cannot be discovered by
normal look on the outward appearance of the thing sold, detected by an ordinary person, discovered only by
an expert or does not show except by practice.

Article 545
The vendor is not answerable for the old defect in the following instances:
1-If, upon sale, the vendor indicates to the purchaser the defect.
2-If the purchaser accepts the defect after he has been aware of it, or after taking knowledge of it from
someone else.
3-If the purchaser buys the thing sold with knowledge of the defect.
4-If the vendor sells to the things sold, on condition that he does not warrant any or a specific defect in it
unless the vendor intentionally hides the defect or the purchaser was in a state that prevents him from
discovering it.
5-If the sale was done by public auction by order of the judiciary or administrative authorities.

Article 546
In case the purchaser, prior to taking knowledge of the defect, disposes of the thing sold as the owner
would do, his option is forfeited.

Article 547
If the thing sold perishes due to an old defect, while in the hands of the purchaser or consumed it before
taking knowledge of the defect, he shall take action against the vendor for deduction of the value of such
defect.

Article 548
1-If a new defect will appear in the thing sold, while in the hands of the purchaser, he may not return it
with the old defect, but shall have a claim against the vendor for the reduction of the price unless the vendor
accepts taking it back with its recent defect.
2- In case the occurring defect ceases to exist, the right to return the thing sold with its old defect to the
vendor shall be reinstated to the purchaser.

Article 549
1-Should the thing sold increase in such a way as to prevent its return back, then the purchaser discovered
an old defect therein, he shall have the right to claim from the vendor the reduction in price because of the
defect and the latter shall not be entitled to claim the restitution of the thing sold to him.
2-The preventing increase is every property of the purchaser related to the thing sold.

Article 550

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1-When several things were sold in one lot and defects appeared, before delivery, in some of these things,
the purchaser may opt between purchasing the whole lot at the nominated price or return it back in full.
2-If several things were sold as one lot and an old defect appeared, after delivery, in some of these things,
and there is no harm done as a result of sorting them out, the purchaser may return the defective part against
its share in the price, but he shall not have the right to return them all without the consent of the vendor.
Should the sorting and separation of these things be prejudicial the purchaser shall have the option either to
return the whole lot or accept it against its full price.

Article 551
1-If there is in the thing sold a defect that necessitates its restitution, and the purchaser, before being aware
of the defect, has constituted in favor of a third party a right thereon that does not transfer title, he shall be
entitled to return it to the vendor with this defect after clearing it from such right if the thing sold was not
altered during this period.
2-If he has constituted a right to third parties after his knowledge of the defect, he shall forfeit his right in
returning it. Should the sold thing be altered, the same provisions governing the alteration of the thing sold
bearing an old defect shall be applicable.

Article 552
The right of the purchaser to return back the defective thing sold shall not be forfeited due to the change in
its value.

Article 553
1-The yields of the returned defective thing sold, which are not considered a part thereof, shall belong to
the purchaser as of the time of possessing the thing sold, up to the date of rescinding the sale. He may not
claim from the vendor the expenses spent on the thing sold.
2-As for the yields of the sold thing which are considered a part thereof, shall belong to the vendor.
3-As concerns the thing sold that does not have any yields, the purchaser shall have a claim against the
vendor for what he has spent.

Article 554
The warranty of the returned defective thing sold shall be transferred from the purchaser to the vendor once
the vendor accepts to take it from the purchaser, even though he does not collect it in fact or upon
establishing before the courts the presence of a defect even before ordering restitution, if the vendor is absent,
otherwise the warranty shall not be transferred until the order of restitution is rendered.

Article 555
1-The lawsuit in warrant of the defect is not receivable due to prescription occurring after the lapse of six
months as of taking delivery of the thing sold, unless the vendor binds himself for a longer period.
2-The vendor shall not adhere to this duration if it has been proved that hiding the defect was by fraud
imputed to him.
B- OBLIGATION OF THE PURCHASER
FIRST - PAYMENT OF THE PRICE AND TAKING DELIVERY OF THE THING SOLD

Article 556
Unless otherwise agreed, the purchaser has to pay the price upon contracting and before taking delivery of
the thin sold or claiming such delivery.

Article 557
1-The vendor may retain the thing sold until receipt of what is due to him from the price, even if the
purchaser has given him a mortgage or a security.
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2-If the purchaser accepts deferring the price, his right in retaining the thing sold shall be forfeited and he
becomes under obligation to deliver it to the purchaser.

Article 558
If the thing sold perishes while exercising his right of retention, the purchaser shall be liable for the loss
unless the thing sold perishes as a result of an act of the vendor.

Article 559
1-If, prior to payment, the purchaser takes possession of the thing sold of the price under the sight of the
vendor, who did not prevent him therefrom, this will be considered an authorization to take delivery.
2-In case, prior to payment, the purchaser takes possession of the thing sold without authorization of the
vendor, the latter may recover it. If it perishes or becomes vitiated while in the hands of the purchaser, it shall
be considered as delivered.

Article 560
Spoiling by the purchaser of the thing sold, even unintentionally, is considered delivery.

Article 561
If the purchaser ignores the place of the thing sold, at the time of contract, and thereafter takes knowledge
of it, he shall have at will the option either to rescind the sale or ratify it and take delivery of the thing sold at
the place where it is.

Article 562
1-Subject to an agreement or custom to the contrary, the purchaser is liable to hand over the down payment
of the price at the place where the thing sold exists at the time of contract.
2- If the price is a deferred debt, on the purchaser and there is no agreement as to its payment at a specific
place, it must be paid at the domicile of the purchaser at time of maturity of the debt.

Article 563
If the purchaser takes possession a thing under negotiation of purchase and it perishes or was lost while in
his possession, and the price thereof was specified, he must pay it, and if such price was not specified there is
no warranty except in case of trespass or default.

Article 564
1-If an action in restitution is instituted against the purchaser based on a prior right on the thing sold, or on
a right given to him by the vendor, the purchaser may retain the price until the vendor provides a solvent
surety guaranteeing to the purchaser to return the price paid upon confirmation of the restitution. The vendor
may ask the court to order the purchaser to deposit the price with it instead of providing a surety.
2-The provision of the above clause shall apply if the purchaser discovers in the thing sold an old defect
warranted by the vendor.

Article 565
In case the sale specifies a certain delay for payment of the price and if not paid within this delay by the
purchaser, there is no sale. If not paid and the thing sold is still in the possession of the vendor, the sale shall
be considered ipso facto rescinded.

Article 566
1-If the purchaser takes delivery of the thing sold, then dies bankrupt before paying the price, the vendor
may not restitute it and the price shall become a debt on the estate and the vendor shall be in the same rank as
the other creditors of the estate.

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2-If the purchaser dies bankrupt, before taking delivery of the thing sold and payment of the price, the
vendor may retain the thing sold until he receives the price from the estate and his rank shall be preferential
to the other creditors of the estate.
3-If the vendor has received the price, and died bankrupt before delivery of the thing sold, this thing shall
be considered a consignment in trust with him and the purchaser shall have precedence thereon over the other
creditors.

SECOND - COSTS OF SALE

Article 567
Subject to agreement, a law provision or custom to the contrary, the costs of delivering the price, the sale
contract and its registration as well as the other costs are borne by the purchaser, while the costs of delivery
of the thing sold are to be borne by the vendor

SECTION TWO

DIFFERENT SALES
SELM” SALES WITH DEFERRED DELIVERY“ -1

Article 568
“Selm” is the sale of a property with deferred delivery against a prepaid price.

Article 569
The validity of a deferred delivery sale is subject to the following conditions:
1-The thing sold should be a property that can be designated by description and quantity, and be available
at time of delivery.
2-The contract is to include a statement of the nature of the sale, its kind, its quantity and the period within
which delivery shall be done.

Article 570
The capital of the sale with future delivery (i.e. its price) must be known quantitatively and qualitatively,
and not to be conditionally deferred for a period exceeding three days.

Article 571
The purchaser may dispose of the thing sold before taking delivery of it.

Article 572
If delivery of the thing sold is impossible prior to the expiry of the period set for completion thereof due to
a sudden contingency, the purchaser shall be at option to wait for its availability or rescind the sale.

Article 573
If the vendor, in a sale with deferred delivery, dies before the expiry of the period set for delivery, he shall
have a choice between rescission of the contract and recovery of the price from the estate or wait until the
expiry of this term and, in this case, lay a seizure on assets of the estate sufficient to cover payment of the
thing sold, unless the heirs provide a solvent surety guaranteeing, upon expiry of its term, delivery of the
thing sod.

Article 574
1-If the purchaser in a sale with deferred delivery exploits the farmer’s need, and buys from him a future
crop, at an evidently unjust price or oppressive conditions, the vendor shall, when the term set for delivery
matures ask the court to modify the price or the conditions, in such a way to relieve the injustice.
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The court, in such a case, shall take into consideration the circumstances as to the time, place, the general
level of the prices and their difference between the date of the contract and that of delivery, according to
custom.
2- The purchaser s entitled to refuse the modification deemed by the court equitable, and recover the true
price which he actually paid to the vendor, and thereupon, the vendor shall be entitled to sell his crop t
whomever he wishes.
3-Shall be void every agreement or condition purporting to forfeit this right whether such condition is
included in the sale contract itself or in the form of another separate obligation of whatever nature.

Article 575
It shall be void that the capital of the sale with future delivery and the object of delivery be two foods or
two currencies, it is sufficient for other than food, that they both differ in type and utility.

Article 576
1-If there is for the thing sold subject to future delivery times where it appears but ceases to be so when the
period set for delivery matures before taking possession of it by the purchaser, he must wait until it reappears,
if he is the cause of such delay, otherwise he shall be at option either to rescind the contract or wait until it
appears.
2-If its existence shall cease after taking delivery of part thereof by the purchaser, he must wait for the
other part unless the parties agree to account for what has been delivered.

Article 577
The object of the sale must be a thing of the same nature but may be of a different nature in the following
instances:
a-The substitute in exchange should be delivered in advance.
b-The substitute should be valid for delivery against payment of the price.
c-The delivered should be other than food.

Article 578
If the time of delivery matures, the vendor shall deliver it to the purchaser at the place agreed upon or, if
the parties did not specify a special place of delivery, at the place of conclusion of the contract. Unless
otherwise agreed, neither the vendor is bound to deliver nor the purchaser to take delivery in a place other
than the two mentioned places.

Article 579
1-If the vendor and purchaser disagree about, or fail to specify, the quantity of the thing sold with future
delivery or the time of delivery, those prevailing between people shall preclude otherwise the via media shall
prevail.
2-If both disagree about the place for delivery of the thing sold, and one of them states that it is the place of
conclusion, this place shall prevail and if no statement has been made by either of them then delivery has to
be made in its market at the place of formation of the contract.
SALES OF VACANT SPACE -2

Article 580
The sale of vacant space for construction purposes may occur in one of the following forms:
a-The sale of a vacant space over a land, the validity of such sale does not depend on the description of the
projected construction.
b-The sale of vacant space above a construction, on condition that the construction to be built thereon is
described.
c-The sale of vacant space over a vacant space to be constructed thereon, on condition that each of the
lower and upper constructions are described. In case of one of such three sales, whereby the purchaser has
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become the owner of the entire vacant space above the land or above the construction, within the limits of
what he bought from this space, but he is not allowed to build more than what was agreed upon without the
consent of the land owner or the owner of the lower construction.

Article 581
The sale of vacant land shall result in the following:
1- It shall not be rescinded by the destruction of either the lower or upper construction.
2-The owner of the lower construction shall have to reconstruct it if destroyed, and restore it if weakened.
The owner of the upper construction, with the consent of the owner of the lower construction, or by court
order, may reconstruct it.
BULK SALE -3

Article 582
1-The bulk sale is the sale of whatever may be dry-measured or weighable, or prepared without measure or
weight or counting, considering as sufficient its gross estimation. This sale shall be effected in bulk, even if
the fixation of the price shall depend on the quantity sold.
2-The bulk sale may be allowed under the following conditions:
a- The purchaser should have viewed it at the time of contracting, or have viewed it, before contracting, a
viewing after which it does not usually get altered until the contract, unless its viewing shall cause damage to
it, in which case it shall be sufficient to describe it.
b- The parties to this sale ignore its measure, weight or number, with the possibility of its gross estimation.
If it is established to one of them, at the time of contract, that the other party had knowledge of the quantity
of the thing sold, the contract shall be void, and if he knew that the other had knowledge thereof after the
contract, he shall be at option either to return the thing sold or pursue the sale.
SALES WITH DEFERRED PAYMENT -4

Article 583
The vendor of a thing with deferred payment may purchase it from the person who has sold it to him with
an immediate or deferred price payment unless both sales are different in price and term, and the payment of
the lesser price would be at a date preceding the payment of the higher price, in such a case the second sale
shall be rescinded, if the sale is still in effect, otherwise both sales shall be rescinded.
SALE ON BASIS OF A SAMPLE-5

Article 584
The sale on basis of a sample is a sale occurring between the one who acts as a purchaser of goods, that he
does not have, vis-à-vis the buyer of a specific item, so if he is asked to provide the requested item he
purchases it and sells it at a price higher than what he paid for it. Such sale is allowed unless it constitutes a
sale with deferred price higher than that previously agreed between them. If this be the case, the second
purchase is cancelled and the thing must be sold at the place agreed upon in the first sale to which shall be
added the lesser of the remuneration for effectuating this transaction and of the profit.
SALE OF FOODSTUFF AND OTHER THINGS BEFORE DELIVERY-6

Article 585
Whoever owns a thing, by purchase or otherwise, may sell it before taking delivery thereof from its
previous owner, unless it is bartering foodstuff, then its purchaser, through dry measuring, may not sell it
before taking delivery thereof. However, if he purchases it in bulk sale, he may sell it before delivery
SALE OF FRUITS -7

Article 586

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1-Fruits, though their maturity is not apparent, may be sold with its stem and may not be sold separately
from the stem unless matured totally or partially. Maturity starts to be apparent when the fruit is beginning to
ripen and becomes edible and ready for use.
2-If the stem of such fruits are of the yearly repetitive fruit bearing type, they may be sold, in case the first
growth starts to mature, if the following growth cycles are successively linked in such a manner as they
cannot be distinguished from each other, but if they can, the second growth yield may not be sold until it
matures.

Article 587
If the fruits are damaged, after their sale, due to a natural blast that cannot be repelled, the purchaser shall
be entitled to ask for the reduction of the price thereof, in proportion to what has been affected by he blast, if
such an affliction has occurred before the full ripening thereof and the usual harvesting, and should the value
of the afflicted amount equals the third or more of the fruits value. However, if the damage is due to lack of
water, the value of the damaged portion shall be deducted from the price, even if its value was less than the
third.
SALE OF CULTIVATED OR SEEDED LAND -8

Article 588
1-If in the land sold there were plants, that are harvested only once a year, such plants remain the property
of the vendor until their first harvesting, unless the purchaser has conditioned that they be his.
2-If, in the sold land, there were plants that are repeatedly harvested or bearing fruit, the stem is for the
purchaser, and the apparent harvested crop is for the vendor, who shall have to cut it off on the spot, unless
the purchaser has kept it for himself, and in this case the latter shall have to cut it off immediately.

Article 589
1-In case a seeded land is sold, and the seed is of kind that the plant resulting therefrom is harvested only
once per year, it shall be for the vendor; like a plant in which the vendor ignores it contains seeds therein
upon conclusion of the contract, he shall opt between either to rescind the contract or proceed with it without
warranty.
2- However, if the seeding is of a type where the resulting plant is clipped once after the other, or its fruit is
repetitive or its stem shall remain alive, it shall be for the purchaser.
EXAMPLE OF THE SALE OF PALM TREES AND TREES -9

Article 590
1-If a palm tree is sold, when its spadix began to break through, or when its fruits began to burgeon or were
out of their perianth without blossoming or be apparent, they shall be for the vendor, and left until clipping,
and what has been sold earlier shall be for the purchaser, and the last word shall be for the vendor who shall
swear that they began to show or break out of their perianth.
2-Each of the vendor and purchaser may benefit of what the owner, in whole or in part, may condition for
himself.

Article 591
1-Cleavage of some spadix in the palm trees, or the appearance of some fruit in the single tree, shall be
considered as a cleavage and the appearance of all its spadix and fruit.
2-Where, however, there are multiple palm trees or trees and some, to the exclusion of the others have been
cleaved or fruits started to show on some, each shall be governed by its own rule.
SALE OF SELF EDIBLE CROPS -10

Article 592
Self edible crops and their formed grains in spikes, both, may be sold.

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Article 593
1-Whoever buys a self-edible crop and by fractioning it found that it is putrid and each fraction thereof has
no value, he may claim back the full price if all fractions are found putrid or the price of the rotten fractions if
some fractions only are uneatable.
2-If the fractions have a value, the purchaser shall be at option either to retain it with damages or return
what is left after breaking it, but if the whole thing sold is spoiled the purchaser is entitled to damages.
TRANSMISSION BY DISSOCIATION -11

Article 594
Transmission by dissociation is the sale made by an heir, after death of the decedent, of his share in the
inheritance, to one or more other heirs, in consideration of a determined compensation, even if the assets of
the inheritance were not yet specified.

Article 595
1-The dissociation contract shall transfer the share, of the vendor, in the inheritance, to the purchaser, and
the purchaser shall replace the vendor in that share.
2-The transmission contract shall not comprise all the property of the deceased which will appear after the
formation of the contract, and which both parties to the contract were ignoring at the time of contract.
Likewise it shall not comprise the rights due to the estate from either or both of the contracting parties, as
well as the rights due by the estate to both or to one of them.

Article 596
The vendor shall not warrant to the purchaser anything except the existence of the inheritance and the
establishment of his right therein, in case the contract without stipulating any preference as to any of the
contents of the estate.
SALE DURING LAST ILLNESS -12

Article 597
1-Last Illness: is when a person is unable to resume his usual business occupations and where the illness
leads most probably to death within last then one year. Should his illness lasts for one year or more while
being in a stagnant health condition without aggravation, his acts are considered valid.
2-Shall be considered as last illness, conditions in which a person is surrounded by the risk of death and
where in similar conditions the person is most probably going to perish even if he is not sick.

Article 598
A sale made by a person during his last illness, to an heir, shall be governed by the provisions of the
following Article.

Article 599
1-If the sick person sells to a foreigner at a price equivalent to the price of a similar thing or a little less, the
sale is enforceable and is not contingent on the authorization of the heirs.
2- If the sale was at price inferior to the value of the thing sold at the time of death, the sale shall be valid
against the heirs if the difference between the value of the thing sold and the price paid does not exceed one-
third of the value of the estate including the thing sold.
3-If this difference exceeds one-third of the value of the estate, the sale is only valid against the heirs if
approved by them, or if the purchaser pays to the estate the amount necessary to make up the two-thirds,
otherwise the heirs shall be entitled to rescind the sale.

Article 600

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A sale made by the sick person to a foreigner shall not be effective for less than the value of a similar thing,
even with little unfairness, against the creditors, if the estate is covered with debts. The purchaser shall then
pay the price of a similar thing otherwise the creditors are entitled to rescind the sale.

Article 601
1-The sale made by an ill person may not be rescinded, if the purchaser has disposed of the thing sold, in
such a manner as making the purchaser, in good faith, acquire a legal right in the assets of the thing sold
against a consideration.
2-In such a case, the creditors of the estate, which is fully covered with debts, may claim back from the one
who purchased from the sick person the difference between the price and the value of the thing sold. The
heirs shall have the same legal right, if one of them was the purchaser, but if he was a foreigner, he shall have
to refund to the estate what completes the two thirds of the value of the thing sold.
SALE BY A REPRESENTATIVE TO HIMSELF -13

Article 602
Without prejudice to the provisions of special laws, no person who represents another person by virtue of a
law provision, an agreement or an order of a competent authority may purchase, either in his own name or in
the name of an intermediary, even at a public auction, property entrusted to him in his representative capacity.

Article 603
No brokers or experts may purchase in their names or in the name of an intermediary goods which they
have been entrusted to sell.

Article 604
Excepting the provisions of the two preceding Articles, the representative, the intermediary or the expert
may purchase for himself if so authorized by his principal or the concerned person.
SALE OF A PROPERTY BELONGING TO ANOTHER -14

Article 605
If a person sells the property of another, without his consent, the sale shall be concluded contingent upon
the ratification of the owner.

Article 606
If the owner ratifies the sale, the contract will become binding on him and enforceable against the
purchaser. The contract will also become enforceable in case title of the thing sold passes to the vendor
subsequent to the formation of the contract.

SECTION THREE

BARTER

Article 607
Barter is the exchange of property or pecuniary right with consideration other than money.

Article 608
Parties to a barter contract will be considered vendor and purchaser at the same time.

Article 609
Barter shall not deviate from its nature by the addition of some money to one of the bartered goods.

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Article 610
In the absence of an agreement to the contrary, the expenses of the barter contract, and costs of delivery
and the like shall be born by the parties in equal shares.

Article 611
The provisions governing sale apply to barter as far as they are not in contradiction with its nature.

SECTION FOUR

FORBIDDEN SALES AND BARTERS

Article 612
The following may not be sold or bartered:
a-What is hidden in the earth until plucked out and viewed.
b-Tail bones of stallion or bull.

Article 613
Sale and barter shall be prohibited and become void in the following cases:
a-If one of the contracting parties is bound by Friday prayers, and signed the contract after the beginning of
the call for prayer at the pulpit, until the completion of prayer. Also, if one or both contracting parties is
bound by written prayer, and signed the contract after its time has been disturbed in such a way that nothing
was left thereof except what accommodates it until it is over, contracting may be allowed in such cases if it
was deemed needed or necessary.
b-If a contract has been concluded for a property to be used illicitly and one of the parties had knowledge
of it from the other or by presumption.
c-If a Muslim sells over the sale of a Muslim, or bought over his purchase, or bartered over his barter at the
time of one of the options or conditions opened in the presence of the parties at the meeting place.

CHAPTER TWO

GIFT

SECTION ONE

ELEMENTS OF A GIFT AND CONDITIONS OF EXECUTION

Article 614
1-Gift is the conveyance, to another person and without consideration, of property or financial right, during
the lifetime of the donor.
2-A donor may, without being divested of the intention of making a gift, impose upon the donee the
performance of a specific obligation. This obligation shall constitute the consideration for the gift.

Article 615
1-A gift is formed by an offer and an acceptance, and completed by receipt thereof
2-In a gift, the offer alone is sufficient if the donor is the natural or legal guardian of the donee and the
property donated is in his possession. Likewise if the donee is a minor custody of the donor.

Article 616
A gift contract shall not be executory in case the thing donated is not the property of the donor, unless
approved by the owner thereof and consented that it be given to the donee.
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Article 617
1-The gift of a debt the debtor is valid and shall be considered a discharge.
2-The gift may also be made to a person other than the debtor and shall be completed if the debtor pays the
debt to the donee.

Article 618
1-The donor may recover the donated property if he so provides in the contract in case the donee fails to
fulfill specific obligations in favor of the donor or of any person of interest to him.
2- If the donated property has perished or the donee has disposed of it, the value thereof shall be due to the
donor computed as of the time of the act of disposition or perishing.

Article 619
The donor must not be interdicted as concerns his gift, he must not also be a man of war or, on other words
a non-Moslem citizen of a non-Moslem State that is in a state of declared or effective war with the Moslems
and provided he did not ask for peace.

Article 620
The gift of a debtor, whose debt has covered all his property, is valid but contingent on the ratification of
the creditor.

Article 621
Whoever mortgages a thing as collateral for a debt then donated it to a person other than the mortgagee and
this latter consented to it, the donation is valid and the debt due to him shall remain without sureties, even if
the mortgagor is insolvent. In vase the mortgagee does not accept the gift made to a person other than him
and the mortgagor is insolvent, the gift is null but if he is solvent, the gift is valid if he pays his debt prior to
its due date or submit a trustworthy surety.

Article 622
If the mortgaged property is donated to anybody else than the mortgagee then the donor dies prior to the
release of the mortgage, the possession of the mortgaged property shall not be, after donation, be considered
for the account of the donee and the gift shall be null and void.

Article 623
The gift shall be void whenever a debt covers the whole property of the donor before the donee takes
possession of the donated property, even if the debt occurred after the date of the gift.

Article 624
1-Donation of trees while making an exception for their fruit for one or more years, on condition that the
donee will irrigate and serve them during this period, shall not be allowed, and must be rescinded if it already
took place.
2-The rescission of the gift shall result in an obligation on the donee to restitute the trees if remaining in
their status.
3-If, however, there is a change in the status of the trees, the donee shall have to pay its price as of the day
he took possession thereof and it shall become his property as of such date. If this be the case, he shall be
entitled to claim back from the donor a similar quantity of the yields he took from these trees, if such quantity
is known to him, otherwise their value.

Article 625
Whoever donates a thing to a person, then donated it before delivery to a second person who took
possession thereof before the first, he shall be entitled thereto and the donor shall not be under obligation to
pay its value to the first person.
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Article 626
The gift of consigned goods made to the consignee is void, and likewise the gift of a borrowed thing to the
borrower, if not accepted by the consignee or the borrower except after the death of the donor, whether they
had knowledge of the gift prior or subsequent to his death.

Article 627
If the thing borrowed is donated to other than the borrower, or the thing is consignment to other than the
consignee, and the donor dies prior to the end of the loan period or prior to the restitution of the consignment,
the possession by the borrower of the thing borrowed, or the consignee of the thing under consignment, shall
be considered as a possession by the donee and the donation completed, if the donor did not deny it,
otherwise the possession by each shall be considered made for the account of the donor and the donation
shall be void.

Article 628
1-The gift made by the minor, and the prodigal without consideration is void.
2-The guardian of the interdicted may not donate any of his ward’s property unless he is his father, and the
gift is made with consideration.

Article 629
If a leased property is donated to other than the lessee, and the lessor dies before the end of the lease
period, the possession thereof by the lessee, subsequent to the donation, shall not be considered as a
possession by the donee before collecting same from the lessee, and in this case the possession of the lessee
shall be considered as a possession by a donee.

Article 630
If one of the spouses has donated to the other a property that necessarily has to be commonly held, or if the
wife donates to her husband their common, the completion of the donation shall not be contingent on a
separate possession by the donee of the donated property. If, however, one of them donates to the other a
property that does not, by necessity, have to remain common, or if the husband donates to his wife their
common domicile, the donation is not complete unless the donee takes independently hold of the thing
donated.

Article 631
1-The consideration for the conditional gift must be known, otherwise both parties may rescind the
contract, even after the receipt of the donated property, unless they agree to specify the consideration before
rescission.
2-If the donated property perishes, or if the donee has disposed of it before rescission, he shall have to
restitute its value as of the day of its collection.

Article 632
The promise of a gift or the gift of a future property shall be void.

Article 633
If one of the parties to a gift deceases or becomes bankrupt, before receipt of the donated property, the gift
shall be void, even if made without consideration.

Article 634
1-A gift may be accepted by the donee after the death of the donor if the donated property is received by
the donee, to give a thought before accepting or rejecting the gift, and he did not accept it except after the
death of the donor.

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2- The object of donation may also be received after the death of the donor or if he endeavored to receive it
during his lifetime but he did not succeed except after his death.

Article 635
A gift by a person on his deathbed is governed by the provisions applicable to a will.

Article 636
The execution of a gift contract is contingent on any procedure which the law condition its fulfillment for
the transfer of ownership. Any party to the contract may complete the required procedures.

SECTION TWO

EFFECTS OF A GIFT
AS CONCERNS THE DONOR -1

Article 637
The donor is under obligation to deliver the thing given to the donee and in this regard the provisions
governing delivery of the thing sold shall be followed.

Article 638
Unless otherwise agreed a donor is under no obligation to warrant against dispossession if the gift was
made without valuable consideration but he is responsible to make good any damage sustained by the donee
as a result of this entitlement should he intentionally hide the cause of such dispossession. However, if the
gift is made for valuable consideration his warranty is limited to the value of the consideration paid by the
donee.

Article 639
If dispossession becomes due after the perishing of the thing donated while in the hands of the donee and
the dispossessor opts to revert on the donee in implementation of the warranty, the latter may claim back
from the donor what he has paid under the warranty.

Article 640
If dispossession becomes due and the donee has increased the value of the thing given in such a manner as
the increment could not be separated without damage, the dispossessor cannot take possession before paying
the value of this increment.

Article 641
A donor does not warrant that the thing given is free of hidden defects, even if intentionally hidden by him,
except where the gift was made for valuable consideration.
AS CONCERNS THE DONEE -2

Article 642
The donee is under obligation to give the consideration asked by the donor whether it is due to the donor or
to a third party.

Article 643
Unless otherwise agreed, should the consideration against the gift be the payment of a debt due by the
donor or by another person, the donee is under obligation to pay the debt.

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Article 644
Unless otherwise agreed, if the thing donated is encumbered with a lien to pay a debt due by the donor or
by another person, the donee is under obligation to pay the debt.

Article 645
The costs of the gift contract and the expenses of delivering and transporting the thing given shall be on the
donee, unless otherwise agreed.

SECTION THREE

REVOCATION OF THE GIFT

Article 646
1-The donor may revoke the gift before receiving payment without the consent of the donee.
2-He may revoke it after payment with the consent of the donee. If the donee does not consent to the
revocation, the donor may apply to the judge for rescission and revocation of the gift whenever he has
reasonable grounds in support, unless there is an obstacle to the revocation.

Article 647
The following may constitute reasonable grounds for the revocation of a gift:
a-If the donor has become unable to maintain himself in accordance with his social position or to meet an
obligation to pay alimony which he is legally bound to pay to another person;
b-In the event of a child being born to the donor after the donation and still being alive at the time of the
revocation, or if the donor had a child which he believed dead at the time of the donation and is discovered to
be still alive;
c-If the donee has failed without justification to meet his contractual obligations or failed in his duties
towards the donor or one of his relatives, and such failure constitutes serious ingratitude on his part.

Article 648
If the donee kills the donor, with premeditation and without right, his heirs are entitled to annul the gift.

Article 649
The following constitutes an impediment to revocation of a gift:
a-If the gift is made by one spouse to the other or to a cognate to a degree precluding marriage unless the
gift may unjustifiably result is discriminatory preference between them.
b-If the donee has definitely alienated the thing given; if however, such alienation is only partial, the donor
may revoke the gift as to the remaining part.
c-If there is an inherent increase of the thing given, involving an increase in value thereof; or if the donee
transforms the thing given in such a manner as causing a change in its name.
d-If one of the contracting parties dies after receipt of the thing donated.
e-If the thing given perished while in possession of the donee; and in case the loss is partial revocation may
be for the remaining part.
f-If the gift has been made against valuable consideration.
g-If the donation constitutes alms or an act of charity.
h-If a creditor donated the debt due to him to the debtor.

Article 650
1-Revocation of the gift, whether by mutual consent or judicially, shall nullify the effect of the contract.
2-The donee is only liable for the restitution of the fruits as from the date of the agreement of revocation or
from the date of the judgment. He is entitled to restitution of the necessary expenses but as for the other
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expenses he may claim restitution only up to the increase in value of the thing donated.

Article 651
1-If without consent of the donee or without a court decision, the donor takes back the thing given, he is
responsible for its perishing whatever the cause may be.
2-If the revocation of the gift is pronounced by a judgment and the thing donated perishes while in the
possession of the donee, after he has been summoned to hand back the thing given, the donee is responsible
of the perishing whatever the cause thereof may be.

Article 652
The father may recover what he had donated to his son; the mother may as well recover what she had
donated to her son, if he is not an orphan, but if he is, she may not be allowed to recover it from him, even if
he became orphan after the gift.

Article 653
The right of each one of the parents in recovering what has been donated to their son shall be forfeited in
the following instances:
a-If the thing given has undergone an inherent change or has been alienated by the donee.
b-If a financial transaction took place, with the donee pertaining to the gift, and the revocation of the gift
has prejudiced the donee or third party.
c-If the donee or the donor contracted, after the gift, a serious illness, and until it disappears any of the two
parents shall recover his right to restitute what he has donated to his child.

CHAPTER THREE

PARTNERSHIP

SECTION ONE

GENERAL PROVISIONS
PARTNERSHIP IN GENERAL -1

Article 654
Partnership is a contract, by which two or more persons, undertake to contribute jointly in an undertaking
of a pecuniary nature by providing a contribution of property or services, with the object of sharing in the
profits or the losses of the undertaking.

Article 655
1-A partnership is deemed by the fact of its constitution, to be a juristic person.
2-Such juristic personality shall not be opposed to third parties until completion of the formalities of
registration and publication required by law.
3-Third parties may, however, if the partnership has not completed the formalities referred to above, avail
themselves of this juristic personality.
ELEMENTS OF THE PARTNERSHIP -2

Article 656
1-A partnership contract must be in writing.
2-If the contract is not in writing, this shall have no bearing on the third party’s rights. As concerns the
partners themselves the contract shall, however be considered valid unless one of them challenges its validity
then it shall be considered invalid as of the date of introducing the case in court.
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Article 657
1-The capital of the partnership must be a sum of money or its equal in negotiable instruments, and in case
it is not cash money its value must be assessed.
2-The contribution of the partners may be in equal or uneven shares but a debt owed by third parties may
not be a share in the partnership’s capital.

Article 658
1-If the contribution of a partner consists of a right of ownership, of an usufruct or of any other real right,
the provisions as to sale shall apply as regards warranties in case of perishing, or against dispossession,
defects or deficiencies.
2- If, however, the contribution consists merely of the use of the property, the provisions as to lease shall
apply as regards the above warranties
3-If the contribution of a partner consists of his services, he must carry out the services he has undertaken
to perform under the contract.

Article 659
1-The profits shall be distributed as provided for in the contract.
2-If the share of each of the partners in the profits has not been determined in the contract, the profits must
be apportioned between them, each in proportion of his contribution in the capital.
3-The losses shall be apportioned between the partners, each in proportion of his contribution in the
capital, and any contrary condition shall be void.

Article 660
If the partners agree that the share of any of them in the profits shall consist in a fixed sum of money, this
condition is null and void and the profits shall be appointed in proportion of the contribution of each in the
capital.

Article 661
If the contribution of the partner consists only of his services, his share in the profits is assessed in
accordance with the benefit that the partnership realizes as a result of his services. If, in addition to his
services, a partner has made a contribution in money or in anything else, he will be entitled to a share in
respect of his services and another share in respect of the contribution he has made in addition to his services.

Article 662
If it is agreed that one of the partners shall not participate in the profits or losses of the partnership, the
partnership deed is void.
MANAGEMENT OF THE PARTNERSHIP-3

Article 663
1-In the absence of a provision or agreement to the contrary, each partner represents the other partners in
the performance of the partnership’s business and acts of disposition coming within the objects for which the
partnership was formed.
2-Every partner is a trustee of the partnership’s moneys in his possession.

Article 664
1-If it is agreed, in the partnership’s deed to delegate to one of the partners to represent the partnership and
to manage its business, he alone is entitled to perform all acts coming within his delegation and all accessory
acts deemed necessary thereto.
2-If the delegation is given to more than who are not authorized to act severally, they have to act jointly
except in matters that do not need an exchange of opinions or in an urgent which may cause prejudice to the
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partnership if not attended to.

3-A partner entrusted, in the partnership’s deed, with the management of the partnership may not be
revoked or his delegation limited without legitimate reason.

Article 665
1-The partnership manager may be appointed from among the partners or from outside the partnership with
or without a salary.
2-The manager shall act within the limits of the objects of the partnership entrusted to him provided he
abides with the contract provisions or, in the absence of such provisions, with what is customary.
3-If the manager exceeds the limits of his competences he shall be liable to compensate any prejudice
sustained by the partnership as a result of his acts.

Article 666
1-The partnership may have more than one manager.
2-If they are several, the competence of each shall be specified.
3-Their discharge or the discharge of any of them shall be done in the same manner by which they were
appointed.

Article 667
Whoever has been delegated, for the management of the partnership, or appointed as manager thereof, may
not withdraw or resign at a time that may be detrimental to the company.

Article 668
Partners who are not managing partners are excluded from the management. They are entitled, however,
personally to examine the books and documents of the partnership.
THE EFFECTS OF THE PARTNERSHIP -4

Article 669
1-The partner, entrusted with the management of the interests of the partnership shall watch over its
interests as if they were his own, unless he has been appointed a manager on remuneration, in which case he
shall not exercise less care than an ordinary man.
2-He shall also abstain from any activity prejudicial to the interests of the partnership or contrary to the
object for which the partnership was formed.

Article 670
A partner may not retain any of the partnership’s funds and, if he does, he shall be liable for the payment of
damages for any prejudice caused to the partnership as a result of such retention.

Article 671
1-If the assets of the partnership do not cover the debts related to its objects, the partners shall be liable for
the balance of these debts from their own funds, each in proportion to his share in the losses of the
partnership.
2- If, however it is provided in the partnership’s deed that they are jointly and severally liable, they shall all
jointly be answerable for the debt.

Article 672
1-Personal creditors of a partner cannot, before liquidation of the partnership, obtain payment of their
claims out of such partner’s share in the capital but only of his share in the profits.

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2-In case the partnership’s deed provides for the joint liability of the partners, such creditor may obtain
payment from the capital of the partnership subsequent to its liquidation.
WIND UP OF THE PARTNERSHIP -5

Article 673
A partnership comes to an end in one of the following instances:
a- Expiration of its term or by the achievement of the object for which the partnership was formed.
b- Total loss of its capital or the capital of one of the partners before turning it over to the partnership.
c- Death, insanity, bankruptcy, insolvency, interdiction or withdrawal of one of the partners.
d- Unanimous agreement of the partners.
e- A court order pronouncing the dissolution of the partnership.

Article 674
1-Prior to the expiration of the partnership’s term, this term may be extended for a fixed period and this
shall be considered a continuation of the partnership.
2-If not withstanding the expiration of the term or the achievement of the object for which the partnership
was formed, the partners continue to carry on their work, this shall constitute an implied extension of the
partnership, from year to year on the same conditions.
3- The creditor, of one of the partners, may oppose the extension of the partnership. His opposition will
suspend the effect of this extension so far as he is concerned.

Article 675
1-Its may be agreed that, in the event of the death of one partner, the partnership will continue with his
heirs, even if they are minors. In this case, and subject to the conditions and provisions stipulated by law, the
heirs shall, pursuant to their approval or the approval of their legal or appointed guardian, replace the
decedent.
2-It may also be agreed that, in case of death, interdiction, bankruptcy, or retirement of one of the partners,
the partnership will continue between the other partners. In such a case, such partner or his heirs will only be
entitled to his share in the assets of the partnership. This share will be assessed in accordance with its value at
the date of the event which resulted in the partner ceasing to be a partner, and must be paid in money. Such
partner will share in subsequent rights only to the extent that such rights arise from operations prior to the
event which resulted in his ceasing to be a partner.

Article 676
The court may, on the demand of any one of the partners, order the dissolution of a partnership for non-
performance by a partner of his obligation, or for having caused a serious damage to the partnership as a
result of his management.

Article 677
1-The majority of the partners may apply to the court for the exclusion of any partner, whenever their
request is based on serious grounds, justifying such exclusion.
2- A partner may also, if the duration of the partnership is fixed, apply to the court to authorize his
retirement from the partnership if he gives adequate reasons for his request.
3-In both above instance, the discharged or retired partner’s share shall be governed by the provisions of
Article 675, paragraph 2, and such share shall be estimated according to its value as at the date of introducing
the case in court.
LIQUIDATION AND PARTITION OF THE PARTNERSHIP PROPERTY -6

Article 678

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The liquidation and the partition of the partnership property is carried out in the manner agreed upon
between the partners; failing such agreement, any interested party may apply to the court to appoint one or
more liquidations to carry out the liquidation and partition.

Article 679
1-The juristic personality the partnership will be maintained, to the extent required for liquidation.
2-Until a liquidator is appointed, the partnership’s manager, or managers, shall be deemed, as far as third
parties are concerned, the liquidators.

Article 680
The liquidator shall undertake all the liquidation tasks such as making the inventory of the partnership’s
assets, collect its dues, pay its debt and sell its property to the extent that it be ready for partition. He shall
have to observe all the restrictions stipulated in the order of his appointment and he may not do any act not
required for liquidation.

Article 681
Rules concerning the partition of common property shall apply to the partition of the partnership’s
property.

Article 682
1- The partnership assets are divided between all the partners after payment of the creditors’ rights,
deduction of amounts required to cover debts that have not fallen due or are subject to litigation and
repayment of disbursements resulting from liquidation.
2- Each partner shall be allocated an amount proportionate to his share in the capital. He shall also receive
from the profits, and bear from the losses the proportion agreed to, or provided for in the present Law
provisions.

SECTION TWO

SOME TYPES OF PARTNERSHIPS

BUSINESS PARTNERSHIPS -1

Article 683
The business partnership is a contract by virtue of which two persons, or more, agree to undertake a work
and warrants it to third parties in consideration of a fee, whether they share the work equally or in a
disproportionate manner, provided their share in the work is combined or concomitant.

Article 684
1- Each of the partners shall be bound to perform the work he agreed to and which was undertaken by one
of them.
2- Each one of them is entitled to receive the fee agreed upon and the work master shall be discharged if he
pays it to any of them.

Article 685
The partner who has accepted his share of the work is not bound to perform it personally, he may give it to
his partner, or to other than a partner, unless the work master has conditioned that it be performed by him in
person.

Article 686
1- Profits shall be shared between the partners as agreed upon between them.

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2-Profits may be divided unequally even if the work is shared equally.

3- Each of the partner is entitled to his share in the profits even he does not perform his work due to a
justifiable reason.

Article 687
The partners are jointly liable to complete the work.

Article 688
In case the thing that the object in which the work is to be performed perishes or becomes defective due to
an act of one of the partners, the work master may recover the compensation from any of them, at his choice,
and losses shall be apportioned between the partners in proportion to their share in the warranty.

Article 689
In a business partnership, the place of work may be offered by some of the partners and the machines and
tools by the others. They may likewise agree that the place, the machines and the tools should be offered by
some of them and the work performed by the others.

Article 690
1- The activities of a business partnership may consist in loading and transporting things regardless of the
kind and loading capacity of the transport means offered by each partner as long as each partner warrants the
work
2- If the partnership object is not accepting to perform the work but only to lease the transport means and
divide the rent between them, the partnership is void and the rent of each of these means shall be vested to its
owner and each one assisting in the collection of the rent and in transporting shall be entitled to the ordinary
fee payable for such work.
APPARENT PARTNERSHIP -2

Article 691
1- An apparent partnership is a contract whereby two, or more, persons agree to purchase something on
credit, due to their credibility, and then sell it on basis that they are partners sharing the profits.
2- The partners shall be responsible for the price of the thing purchased, each in proportion of his share in
it, whether they purchased it in common or separately.

Article 692
Unless otherwise agreed, profits and losses shall be apportioned between the partners in proportion to their
liability assumed upon purchasing the thing on credit.
SPECULATIVE PARTNERSHIP -3
)CAPITAL ADVANCE(

Article 693
The speculative partnership is an agreement whereby the capital owner agrees to provide the capital and
the other party to endeavor and work aiming at realizing a profit.

Article 694
In order to be valid, speculation should satisfy the following conditions:
1- Capacity of the financier to give a proxy and of the proxy to act as such.
2- The capital invested should be known and negotiable.
3- The capital may not be a loan or deposit by the financier of which the party receiving the loan or the
deposit is liable to refund or restitute it.
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4- Payment of the capital to the other party in the contract.

5- The share of each partner in the profits must be determined and common property.

Article 695
1- Subsequent to receiving the capital, the receiving partner shall have the capacity to dispose of it by
proxy from the provider.
2- The receiving party shall act as a trustee of the capital received and a partner in the profits.

Article 696
The party receiving the capital may not be asked to warrant it if lost or perished without negligence from
his part.

Article 697
The speculation may be general and absolute or limited in time, place or kind of trade or by any other
restricting condition.

Article 698
1- In case the speculation contract is absolute, the speculator shall be considered authorized to act and
dispose of the capital in speculation matters and its ramifications according to the established custom in this
respect.
2- The speculator may not mix up the speculation moneys with his own funds or give it in speculation to
others, unless admitted customarily or if authorized, by the capital provider, to act according to his own
judgment.
3- Likewise, the speculation capital may not be given as a gift or loan or as a collateral for a debt so as it
exceeds the amount of the capital, without express authorization of the capital provider.

Article 699
Should the capital provider limit the speculation to certain restrictions that should be followed and if the
speculator exceeds the limits within which he is authorized to act, the profits shall be allocated as agreed
upon between the partners and the losses to be born by the speculator.

Article 700
If the speculator shared with another speculator the speculation money, or sold some of his goods on credit
basis, without the permission of the capital's owner, the first speculator shall guarantee the speculation money
against all deterioration or loss, in both instances.

Article 701
If the speculator pays the speculation money, without the consent of the capital's owner, to another person
to use it for his work with, then the first speculator shall guarantee whatever deterioration or loss sustained
and nothing shall be required from the second speculator. If the latter realizes a profit, the first speculator
shall not take any part thereof, and the second speculator shall collect part of the profit which was allocated
to him if equal to the part allocated for the first speculator and, if less, the increment shall be in favor of the
capital owner and not to either the first or second speculators.

Article 702
If the speculator uses the speculation money in his trade and looses part of it and pays the balance, without
permission from the capital owner, to another for the purpose of speculation and the latter realizes a profit,
the capital owner shall recover, from the second speculator, all his capital plus his share in the profit. In this
case, the second speculator shall be entitled to turn back on the first speculator for the balance of his share in
the profit should he be unaware of the violation or loss of the first speculator, otherwise he shall not be
entitled to claim anything from him.

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Article 703
1-The speculator and the capital's owner must share the profit, in the proportion agreed in the contract and,
if not fixed, it shall be divided between them according to the prevailing custom, otherwise in equal shares.
2-If it is allowed to the speculator to mix his money with the speculation capital, the profit shall be divided
proportionately with the capital, thus the speculator shall collect the profit of his capital, and the profit of the
speculation money shall be distributed among the contracting parties in the manner stated in the first
paragraph.

Article 704
1- The capital's owner shall bear, alone, the loss, and any condition to the contrary shall be void.
2- If any of the speculator money shall deteriorate it shall be deducted from the profit and, if it exceeds it,
the remainder shall be charged to the capital account. The speculator shall not be held liable for it.

Article 705
Speculation shall terminate in the following instances:
1- Rescission of the contract by either of the contracting parties.
2- The dismissal of the speculator by the capital owner, and the speculator shall be prohibited to dispose of
the speculation money, after his knowledge of the dismissal, if such money was in the form of cash money
otherwise, the speculator may convert it to cash.
3- The expiry of the term, if it was limited by a certain period.
4- If one of the contracting parties passes away, or became insane, or interdicted.

Article 706
If one of the contracting parties has terminated the speculation, before term, the prejudiced party may
claim back from the other to repair the damage sustained by him.

Article 707
1-If the speculator dies without specifying the speculation money, the right of the capital owner shall be a
debt against the estate.
2-If the speculator has specified it prior to his death, and it was found in his estate, it shall be allocated for
the capital's owner, in priority against his rivals.

Article 708
The general provisions applicable to a company shall govern the business companies, speculation and
methods thereof, in all matters that does not contravene the special provisions applicable to each.

Article 709
The rules stipulated in this chapter shall not violate the provisions of the particular laws.

CHAPTER FOUR

LOAN

Article 710
A loan is the transfer to the borrower of ownership of a sum of money or any fungibles upon condition that
the borrower returns, at the end of the loan, a thing equal in amount, kind and quality.

Article 711

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The borrower owns, by contract, the loan in full property even if he did not collect it from the lender and it
shall be adjudicated in his favor if the lender refrains from delivering it to him. The loan shall not become
void if any impediment occurs to the borrower preventing him from disposing of the sum of money before
receiving it.

Article 712
1-The lender must, as a condition, enjoy the capacity to donate.
2-The guardian or the custodian does not have the authority to lend or borrow a sum of money owned by
whoever is under his guardianship or custody except by permission of the court.

Article 713
The borrowed money must be fungible and consumable.

Article 714
If the loan contract is conditioned upon paying a benefit that exceeds the contract requirements, other than
guaranteeing the borrowers right, the condition is void but the contract is valid.

Article 715
A loan may be granted on condition of a pledge or guarantee.

Article 716
In the event of dispossession of the borrowed money while the loan is still effective and in the hands of the
borrower, his obligation to refund a similar thing shall be forfeited and he shall be entitled to turn back on the
lender claiming satisfaction for any prejudice that he may sustain because of this dispossession, if acting in
bad faith.

Article 717
If a hidden defect appears in the borrowed money, the borrower shall only be liable to restitute its value, as
defective.

Article 718
1-If the loan has a fixed or customary date of maturity, the borrower is under obligation to refund it to the
lender upon expiry of its period, even if he did not benefit from it.
2-If the loan it has no due date, the borrower is not bound to restitute it until the expiry of a reasonable
period within which he is enabled to benefit of it as accustomed in similar things.

Article 719
1-The borrower is bound, upon expiry of the loan period, to restitute a thing equal in amount, kind and
quality, at the agreed time and place, regardless of whatever change may occur to its value.
2-If restitution of a similar thing reveals to be impossible, the lender’s right shall accrue to its value on the
day received.

Article 720
If several persons borrowed a thing which was received by one of them with the consent of the others,
none of these may claim from him more than his share in the thing received.

Article 721
1-Unless otherwise explicitly or impliedly agreed to the contrary, the borrower is bound to repay the loan
at the country where it has been granted.

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2-If it has been agreed that repayment should be done in another country where the value of the loan differs
from its value at the place of origin, the lender’s right shall accrue on the value at the place where the loan
originated.

CHAPTER FIVE

COMPROMISE

Article 722
Compromise is a contract by which the two parties thereto put an end to a litigation and settle a dispute by
mutual consent.

Article 723
1-In order to effect a compromise, the parties must have legal capacity to dispose for valuable
consideration of the rights which are the object of the compromise.
2-The capacity to donate is required if the compromise includes waiver of some rights.

Article 724
The compromise of the discerning child and the imbecile, if authorized, is valid if they do not sustain any
apparent prejudice. The same rule shall apply to tutors guardians and curators, without prejudice to the
specific law provisions.

Article 725
The object of the compromise must be something which consideration may be taken as a substitute thereof
even if it is not a sum of money and must be known as concerns collection and delivery.

Article 726
1-The compromise consideration must be known if it requires collection and delivery.
2-If the compromise consideration is a property or usufruct owned by third parties, the validity of the
compromise is incumbent on the consent of this third party.

Article 727
1-Compromise may be made on rights whether admitted by the defendant or denied or to which he kept
silent and did not show consent or denial.
2-In case of acknowledgment, if the compromise takes place on a consideration to be paid by the admitting
party, it shall be considered a sale, or a rent, if on a usufruct.
3-In case of denial or silence, the compromise shall be considered an exchange, as regards the plaintiff and
in consideration of oath and settlement of the dispute, as concerns the defendant.

Article 728
Should a person make a compromise on part of his claim or a portion of what he claims to be due by the
other party, he has forfeited his right to the balance.

Article 729
1-If a compromise is reached between two persons, each claiming a property in the possession of the other,
provided that each keeps the property in his possession, it shall be considered a barter the validity of which is
not dependent on knowledge of the two bartered properties.
2-Compromise shall be governed by the clauses of the contract which is closest in similarity with it, as
concerns validity and its resulting effects.

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Article 730
1-Compromise shall result in transferring the right of the compromising party to the consideration thereof
and forfeiture of his right object of the dispute.
2-Compromise shall be binding to both parties, and none of them, or his heirs thereafter, may retract
therefrom.

Article 731
The effect of compromise shall be restricted to the rights involved and settlement of the dispute thereto.

Article 732
Both parties to a compromise may go back on it, if considered an exchange, but may not do so if it includes
a waiver of some rights.

Article 733
Compromise may not be reached in case it includes any of the following impediments:
1- Extinction of a debt in a debt.
2- Sale of the food exchanged before its receipt.
3- Deferred Exchange of gold for silver and vice versa.
4- Usury on credits granted.
5- Relieving the debtor from some of the deferred debt, with a view to expediting reimbursement
6- Removal of the deferred debt security from the debtor, against expediting payment with an increment
added thereto.
7- Beneficial advance payments.

Article 734
The innocent victim of a compromise by denial may reject the compromise in the following instances:
1- If the unjust acknowledges, after the compromise, the injustice made to the other party.
2- If subsequent to compromise, a proof in favor of the victim of injustice was revealed that was unknown
at the time of the compromise and took an oath that it was not known to him.
3- If he has a missing proof which he could not produce at the time of litigation and which he would have
produced at the time of the compromise if it were there.

Article 735
If a compromise was reached based on denial, due to the fact that the supporting document of the right
object of the compromise was not in the possession of the defendant, he shall be entitled to renounce to the
compromise if found thereafter. However, if he alleged that the document was with him and when asked by
the plaintiff to produce it in order to take his right as stated therein he pretended that it was lost and reached a
compromise with him, he may not renounce to the compromise thereafter, if found.

Article 736
If one of the heirs reaches a compromise with a debtor to their decedent, the other heirs may constitute
themselves as a party to the compromise or instead claim from the debtor their right or reach a compromise
with him.

Article 737
Some heirs may compromise on their share in the estate by accepting part of the estate subject to the
presence of the other party in the compromise if he has received what is equal or below his share, or the
presence of all the heirs if he received more than his share.

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Article 738
1- If one of the two creditors has compromised with a debtor to both of them, the other creditor may refuse
to participate in the thing object of the compromise and revert on the debtor claiming his share. In case he
finds him insolvent he may not have a claim at all against his partner.
2- The other creditor may join his compromising partner in what he has compromised, if he did not abstain
from compromising and, in this case, he shall claim from the debtor the balance of his share and the
compromising creditor shall have a claim against the debtor for what his partner took from the latter.

Article 739
Compromise may not occur on consumables, such as honor, animal unspecified food against deferred food
of the same or different unless the object of compromise is a property of equal or lesser value.

Article 740
If it is impossible to have knowledge of something unknown, it may be the object of compromise against
something known, provided ignorance is from both sides or from the debtor alone.

Article 741
Without prejudice to the provisions of articles 734 and 735 herein, compromise shall irrevocably settle the
dispute. The claim of the defendant may not be heard even if he establishes evidence to his claim or to the
fact that the denying party has previously acknowledged the object of the claim.

TITLE TWO

CONTRACTS ON USUFRUCT

CHAPTER ONE

LEASES

SECTION ONE

LEASES IN GENERAL
DEFINITION OF LEASE -1

Article 742
A lease is granting ownership of the use of a specific thing to the lessee for a certain time in return for a
fixed rent.
ELEMENTS OF A LEASE -2

Article 743
The conclusion of a lease contract is made contingent upon the capacity of the contracting parties at the
time of the contract.

Article 744
1- The implementation of a lease contract requires that the lessor, or whoever acts on his behalf, has the
right to dispose of the leased premises.
2- The lease contract made by a person who by his own initiative and without authority from the owner is
contingent upon the ratification of the owner of the right to dispose of the premises and the satisfaction of the

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conditions of its validity.

Article 745
The object of the contract of lease is the enjoyment of the right to use the leased premises which takes
effect by delivery thereof.

Article 746
The use of the premises object of the contract is condition upon:
1-that it be realizable.
2-that it be sufficiently known in order to settle the dispute.

Article 747
The premises object of the use must be known either by visiting I, determining its location or giving its
detailed description, otherwise the contract shall be void.

Article 748
1-Rent must be known either by specifying its kind and amount, if cash money, and by specifying its kind,
description and determination of its amount, if otherwise.
2-If the rent is unknown, the lease contract may be rescinded and the rent for the period preceding the
rescission shall be due on basis of the rental of similar premises.

Article 749
The rent may be in kind, a debt or a usufruct.

Article 750
The rent shall be due upon completion of the use or make its completion possible.

Article 751
Payment of the rent may be in advance, postponed or by installment payable at fixed intervals.

Article 752
1-If the contract does mention the period within which the rent should be paid, it shall absolutely be due
after completion of the use or after its completion becomes possible.
2-As for the rent due for a time unit, the periods of payment shall be fixed by custom, otherwise the judge
shall fix same upon request of the interested party.

Article 753
No rent shall be due, for the period preceding the delivery of the leased object, unless the lessee is
responsible for the delay in delivery.

Article 754
The lease period shall start as of the date fixed in the contract, otherwise from the date of the contract.

Article 755
The lease period must be made known.

Article 756

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In case the lease contract is made for an indefinite period or if it becomes impossible to establish the
alleged period, the contract shall be considered made for the period specified for payment of the rent and
expires at the end of this period upon request of any of the contracting parties.

Article 757
If a lease contract expires, and the lessee continues to use the leased object with the knowledge of the
lessor and without his objection, the lease shall be considered renewed under the original conditions and for a
similar term.

Article 758
The lease may be reported for a future date which shall be binding by contract unless the leased object is
the property of an endowment or of an orphan and, if this be the case, it may not be reported for more than a
year from the date of the contract.

Article 759
If the period of the lease has expired, and the necessity for its extension has been established, then it shall
be extended to the extent of this necessity provided the lessee pays a rent equal to the rent of a similar object.

Article 760
If the lessor asks the lessee to pay a specific increase, over and above the named rent, after the expiry of
the lease period, this increase shall be binding to him in case the said period expires and he kept in possession
of the leased object without objection.
EFFECTS OF A LEASE -3

Article 761
The two contracting parties are bound to implement the contents of the contract in such a way as to realize
its legitimate objective.

Article 762
If the lease contract has been validly formed, the usufruct of the leased object shall be transferred to the
lessee.
LIABILITY OF THE LESSOR -4
A- DELIVERY OF THE LEASED PROPERTY

Article 763
1-The lessor is bound to deliver to the lessee the leased property and its accessories in a condition suitable
for the full achievement of the purpose for which it was intended.
2-Delivery shall be completed by enabling the lessee to take hold of the leased property without an
impediment obstructing the usufruct thereof, while remaining in his possession for an uninterrupted period
until the expiry of the lease period.

Article 764
The lessor may refrain from delivering the leased property until he receives the rent payable in advance.

Article 765
1-If the object of the lease is something specific in consideration of a global rent and there is mention of
the number of its units without specifying the rent for each unit, then it was revealed that its units are over or
below what is mentioned, the rent shall be that named in the contract without any addition or deduction but in
the latter case the lessee shall have an option to rescind the contract.
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2-If the rent of each unit has been named in the contract, the tenant shall be liable for the named rent for
the excess units, and the lessor is bound to deduct the named rent for the missing units. In either case, the
lessee shall have an option to rescind the contract.
3-Should however the excess or the shortage be minimal without any effect on the intended benefit, the
lessee shall have no such option.

Article 766
The delivery of the leased property and its accessories shall have the same effects as the delivery of the
thing sold, unless otherwise agreed by the contracting parties.
B- MAINTENANCE OF THE LEASED PROPERTY

Article 767
1-The owner is bound to repair the defects occurring to the leased property affecting the fulfillment of the
intended purpose. In case he abstains from doing so, the lessee may ask the judge to allow him carrying out
the repairs and claim from the lessor the expenditures incurred to the extent customarily allowed.
2-If the defect which the lessor is bound to repair, is customarily considered a minor or urgent thing, that
cannot be delayed, and the lessee has asked him to repair it, but he delayed taking action, or it was impossible
to contact him, the lessee may repair it and deduct the cost, to the extent customarily allowed, out of the rent.

Article 768
1-If the lessee, by permission of the owner, has made constructions, or improvements, to the benefit of the
leased premises, or its maintenance, he may claim from the lessor the cost thereof, to the extent customarily
allowed, even if he did not reserve to himself the right to this claim.
2-However, if the works done by the lessee were for his personal benefit, he shall have no claim against the
lessor.

Article 769
1-The lessor may prevent the lessee from any work which may destroy or change the leased property, and
from putting any machines or equipment that may be detrimental to it or reduce its value.
2-If the lessee does not abstain, the lessor may ask the judge to order the rescission of the contract, and
remedy the damages caused by such transgression.
C- WARRANTY OF THE LEASED PROPERTY

Article 770
1-The lessor may not do anything which disturbs the lessee in his enjoyment of the leased property during
the period of the lease, and shall not make any alterations to the property that prevent or disturb such
enjoyment, otherwise he shall be held liable.
2-The lessor not only warrants the lessee against his own acts and against those of his servants but also
against any disturbance or damage based on a lawful claim by any other lessee or by any successor in title of
the lessor.

Article 771
If, as a result of such disturbance, the lessee is deprived from the enjoyment of the leased as provided in
the contract, he may ask the rescission of the lease or a reduction of the rent together with the payment of
damages for the prejudice sustained by him.

Article 772
1-The lessor shall warrant the lessee all defects in the leased property that may prevent or considerably
reduce the enjoyment thereof, but he does not warrant the defects that are customarily tolerated.

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2-The lessor shall not warrant the defect if the lessee had knowledge of it at the time of the contract or
could easily have knowledge of it.

Article 773
If, as a result of such defect, the lessee is deprived of the enjoyment of the leased property, he may ask
rescission or reduction of the rent, together with the payment of damages for the prejudice sustained by him.

Article 774
The presence of a defect in a lease shall be governed by the provisions applicable to the option opened in
case of defect in the property object of a sale in all matters that are not incompatible with the nature of a
lease.

Article 775
Any agreement exonerating from warranty against disturbance or defect is void if the lessor has
fraudulently concealed the cause of such warranty.
OBLIGATIONS OF THE LESSOR -5
A- PRESERVATION AND RETURN OF THE LEASED PROPERTY

Article 776
1- The leased property is in trust in the hands of the lessee who shall warrant every shortage, deterioration
or loss resulting from his neglect or trespass. He is bound to preserve it as would an ordinary person do.
2- When there are several lessees, each one of them shall warrant the damages resulting from his trespass
or neglect.

Article 777
1- In the use of the leased property, the lessee may not exceed the limits of enjoyment agreed upon in the
contract. In the absence of such agreement, enjoyment of the leased property should be within the purpose for
which it was designed and in the manner customarily practiced.
2- In case he exceeds in his enjoyment the limits agreed upon or contradicts what is customarily practiced,
he must warrant against whatever damage that may result from his act.

Article 778
1- The lessee may not, without the permission of the lessor, make any alteration to the leased premises
unless necessitated for its repair and no damage is thereby occasioned to the lessor.
2- Unless otherwise agreed, if, in the fulfillment of this obligation, the lessee exceeds its limits, he shall be
compelled to reinstate the leased property to its original condition and, in addition, to pay compensation if
due.

Article 779
1-The lessee is bound to carry out the restoration works agreed upon or those of which he customarily in
charge.
2-He shall have, during the lease period, to clean the leased property and remove all the dust or garbage
accumulated thereon, and all what he is customarily in charge thereof.

Article 780
1-The lessee may not prevent the lessor from carrying out the necessary maintenance works to the leased
property.
2-In case these works shall disturb the lessee in his enjoyment of the leased property, he shall be entitled to
rescind the contract unless he continues to enjoy the use thereof until the achievement of the maintenance
works.
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Article 781
1-The complete loss of enjoyment of the leased property shall release the lessee from paying the rent as of
the occurrence of such loss.
2-In case the loss is partial but in a manner that may affect the full enjoyment, the lessee is entitled to
rescind the contract and he shall be relieved from paying the rent as of the rescission date.
3-Should the lessor repair the leased property prior to the rescission, the lessee shall only be relieved from
paying the rent to the extent of the lost enjoyment but he shall not be entitled to rescind the contract.

Article 782
1-If the full enjoyment of the leased property is prevented, due to an act of the competent authorities,
without cause attributed to the lessee, the lease shall be rescinded and the rent forfeited as of the date of such
prevention.
2-If only partial enjoyment of the leased property is prevented, in a manner that affects the designed
enjoyment, the lessee is entitled to rescind the contract and he shall be relieved from paying the rent as of the
date of notifying the lessor.

Article 783
The lessee may rescind the contract in the two following instance:-
1-If its execution shall lead to an evident detriment to the person or property, whether his own or of any of
his subordinates, in the enjoyment of the rent property.
2-If anything occurs that prevents the implementation of the contract.

Article 784
1-The lessee is bound, upon expiration of the lease period, to restitute the leased property to the lessor, in
the condition in which it was at the time he took delivery thereof excluding loss or deterioration due to a
cause not imputable to him.
2-If he retains it unlawfully, he is bound to pay to the lessor compensation equal to the rent of a similar
property as well as damages for the prejudice sustained.
3-If the restitution of the leased property requires transportation, the transportation expenses shall be borne
by the lessor.

Article 785
If the lessee has erected buildings, planted trees in the leased property, even with the lessor’s permission,
the lessor is entitled, at the expiration of the lease, either to remove the buildings and the plants or
appropriate the improvements at cost price ready for removal, if its removal is detrimental to the property,
otherwise the lessor may not keep it without the consent of the lessee.
B- LENDING AND SUB-LEASING THE LEASED PROPERTY

Article 786
The lessee may lend or sublet the whole or part of the leased property without valuable consideration if the
property is not altered through change of user.

Article 787
The lessee may not sublet whole or part of the leased property to another person without permission or
approval of the lessor.

Article 788
In the instances shown in the previous two articles, the lessee must abide by the conditions set forth in his
lease contract as to nature and duration.

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Article 789
If the lessee sublets the leased property with the permission of the lessor, the sub-lessee shall substitute the
original lessee in all his rights and obligations resulting from the original contract.

Article 790
If the contract, concluded with the original lessee, is rescinded or terminated, the lessor is entitled to
terminate the contract with the sub-lessee and recuperate the leased property.
END OF THE LEASE CONTRACT -6

Article 791
1-The lease shall terminate in the two following instances:
a- At the expiration of the agreed term unless automatically renewable.
b- At the expiration of the enjoyment right if the lease is issued by the owner of such right, unless approved
by the owner of the property.
2-If, after the lease has expired, the lessee continues to enjoy the leased property with the express or
implied acceptance of the lessor, the contract is deemed renewed under the same original conditions.

Article 792
If the lessee has used the leased property without right, after the expiration of the lease term, he is bound to
pay the rent due on a similar property for the period of utilization, and shall in addition warrant the lessor
against any damage occurring to the leased property.

Article 793
1-The lease shall not end with the death of one of the contracting parties.
2-The heirs of the lessee may, however, request the termination of the contract, if they establish that, due to
the death of their decedent, the onus of the contract has become heavier than what their financial resources
can bear or if it exceeds the limits of their needs.
3-If the lease has only been contracted due to the occupation of the lessee or for other personal
considerations, then he passed away, his heirs or the lessor may ask the termination of the contract.

Article 794
1-One of the contracting parties may, for an unforeseen excuse concerning him, ask the termination of the
lease contract and, in this case, he shall warrant to the other party, within customary limits, against the
damages that he may sustain as a result of such termination.
2-In case the lessor is the one who asks the termination of the contract, the lessee is not bound to restitute
the leased property until he receives the compensation or obtains a sufficient collateral.

Article 795
1-If the leased property is sold without permission of the lessee, the sale shall be enforced between the
seller and the purchaser but shall not affect the right of the lessee.
2-If the lessee authorized the sale or approved it, the sale shall be binding to him and he shall be under
obligation to deliver the leased property unless he has paid the rent in advance, in which case he is entitled to
retain the leased property until he is reimbursed a portion of the rent equivalent to the period during which he
did not enjoy the use of the said property.

Article 796
The lease contract of a house or a similar property shall not be terminate because of the illicit use of it by
the lessee and he was ordered by the public prosecution to put an end to his viciousness. In case of non
compliance to this order, the judge shall, upon request of the owner or a neighbor, evict him from the
property and have it leased to another person, in case the house or the neighbor has suffered a prejudice, in
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which case he has to pay the rent for the period starting from the date of his eviction until the property is
leased to a new lessee.

SECTION TWO

CERTAIN KINDS OF LEASE

LEASES OF AGRICULTURAL LANDS -1

Article 797
The lease of an agricultural land is valid if accompanied by a statement specifying what is cultivated
therein or allowing the lessee to plant whatever he wishes.

Article 798
The lease of a land may not be a definite lease while occupied by unharvested plants duly planted, unless
the lessee is the owner of these plants.

Article 799
The lease of planted land may be allowed, and the owner thereof shall be charged to pluck off the plants
and deliver it to the lessee, in the two following instances:
a. If the land has been rightfully cultivated and the plants harvested at the time of the lease.
b. If the land was not unduly cultivated, whether the plant was harvested or not.

Article 800
The lease period of the planted land may start at a future date when the land will be vacant.

Article 801
1-If a person leases a land for cultivation, the lease thereof shall include all its rights, however the
agricultural tools and machines and the permanent fixed constructions are excluded unless specified in the
contract.
2-If the contract includes the lease of the agricultural tools, machines, and others, the lessee is bound to
maintain and use these properly.

Article 802
Whoever leases a land that he can plant as he wishes, he may cultivate it repeatedly during the year,
summer and winter.

Article 803
If the lease period has terminated before ripening of the plants, for a reason beyond the control of the
lessee, it shall be left in consideration of a rent of similar things until its ripening and harvesting.

Article 804
The lessee must work the agricultural land in accordance with the requirements of normal agricultural use.
He must maintain the land in a good state of production and he is not allowed to change the established
method of cultivating the land, the effects of which might extend beyond the period of the lease.

Article 805
1-The lessee is bound to carry out repairs necessary for the normal enjoyment of the land.
2-The lessee must carry out the repairs which are required for the usual utilization of the land, and the
maintenance of irrigation machines, drains, roads, viaducts and wells.

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3-This, unless the agreement or custom runs otherwise.

Article 806
If the leased land is submerged by water so that it becomes impossible to cultivate, or if water is cut off,
and land has thus become impossible or too onerous to irrigate, it or if a force majeure has impeded its
cultivation, then the lessee may rescind the contract and shall not have to pay the rent.

Article 807
If the plants have been destroyed before its harvest, for a reason beyond the control of the lessee, he shall
have to pay from the rent in proportion of the period lapsed before the destruction of the plants, and the
remainder shall be forfeited, unless it was within his ability to plant similar ones, thus he shall be bound to
pay the share of the rent for the remaining period.

Article 808
Neither the contract may be rescinded nor the whole, or part of the rent forfeited if the lessee has received a
warranty from any source against the prejudice sustained.
SHARECROPPING -2
)MUZARAA(
A- DEFINITION OF SHARECROPPING

Article 809
Sharecropping is a contract, for the exploitation of a land between the land owner and the exploiter,
whereby the produce is shared between them in the proportion agreed upon.
B- FORMATION OF THE SHARECROPPING RELATION

Article 810
The validity of a sharecropping contract is contingent upon:
a- The land must be known and fit for cultivation.
b- The kind of plants and the type of seeds must be specified otherwise the exploiter shall be given the
freedom to plant whatever he wishes.
c- The share in the produce for each of the two parties should be defined in terms of a proportion in
common property.

Article 811
It is not allowed to condition the deduction of the cost of seeds or the value of the tax on the bare land from
the principal of the produce before partition.

Article 812
In sharecropping, the duration of the agreement must be specified in such a way as to be consistent with
the achievement of the purpose there from, otherwise the contract shall remain in force for a single
agricultural cycle.
C- EFFECTS OF THE SHARECROPPING CONTRACT

Article 813
If the sharecropping contract is formed, the produce shall be owned in common by the parties thereto and
shall be divided between them in the proportion agreed upon.

Article 814
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1-If the sharecropping land is adjudicated to another person after planting it but before harvesting and the
two parties to the sharecropping contract were in good faith ignoring the reason why it was adjudicated, they
may keep the land under sharecropping until the end of the season of what has been planted and the party
who has contributed by offering the land shall have to pay to the adjudicated owner a rent equivalent to that
of a similar land.
2-In case both parties were of ill-faith, the adjudicated owner is entitled to pluck off the plants and recover
his land free from any occupancy and without any obligation to either one of them.
3-If the one who has offered the land is alone of bad faith, and the adjudicated owner refused to leave the
land in their possession in consideration of a just rent until the end of the season, then the following shall
apply:
a- If the seeds were supplied by the one who has offered the land, he shall pay to the other party a just fee
commensurate with his work, together with a compensation equivalent to the amount disbursed, wages paid
to the workers,...etc within customary limits if the contract binds him to make such disbursements. The party
offering the land may avoid this by paying to the other party the value of his share in the plants once matured,
not plucked off, until harvest.
b- If the seeds were supplied by the farming partner, he shall be entitled from the party offering the land the
value of his share in the ripened crops until harvested.
c- In both cases, whether the seed was supplied by him or by the one who has offered the land, the
sharecropper may opt to take his share out of the plucked off crop, then he will get nothing else.
D- OBLIGATIONS OF THE LAND OWNER

Article 815
1-The land owner shall have to deliver the land fit for cultivation, with all its easement rights such as
drinking and passage, and all what is allocated for its exploitation, if permanently fixed thereon. .
2-He shall also be liable to repair the agricultural tools which he shall have to deliver fit for use, whenever
they need repair, as a result of normal use.
E- THE SHARECROPPER’S OBLIGATIONS

Article 816
1-The sharecropper shall be liable for the supplies of the agricultural works, the maintenance of the crop
and its preservation, the irrigation canals and any similar things, until the season of the crop harvesting.
2-The supplies of the crop after its ripening, harvest and what follows, as well as the ensuing expenses
until partition of the produce shall be the liability of each of the contracting parties in the proportion of his
share.

Article 817
1-For the purpose of cultivation and preservation of the land and its auxiliaries, as well as the plants and
the crop, the sharecropper shall have to exert the care of an ordinary person.
2-In default of the above and if his neglect shall cause a prejudice, he is bound to pay damages.

Article 818
1-The sharecropper may not rent the land or charge others of its cultivation except with the consent of the
land owner.
2-Should the sharecropper violate such obligation, the land owner may rescind the sharecropping contract.
If the land was, at the time of rescission, cultivated and the seed was supplied by the land owner, he may
recover such, and revert on the sharecropper for the prejudice sustained; and if the seed was not supplied by
him, he may either recover the land cultivated and pay the cost of the seeds to its owner, or to leave the crop
for both until its harvesting time, and charge the first sharecropper with the equivalent rent and compensation
for the damages caused by him.
F- EXPIRATION OF THE SHARECROPPING CONTRACT

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Article 819
The sharecropping contract shall end by the expiration of its term. If such term has expired before the
ripening of the crop, the sharecropper may keep until it ripens in consideration of paying the rent of an
equivalent land proportionate with the amount of his share in the crop for the following period. The necessary
expenses for the green crop shall be born by each of the land owner and the sharecropper in proportion to
their shares.

Article 820
1-Should the land owner pass away while the crop did not yet ripen, the sharecropper shall keep carrying
on the work until the ripening of the crop, and the heirs may not prevent him.
2-If the sharecropper dies before the ripening of the crop, his heirs shall replace him in the work, until
ripening of the crops, despite the refusal of the land owner

Article 821
1-If the sharecropping contract is rescinded, or its voidance has been demonstrated or declared by
judgment, the whole crop shall be for the seeds owner. If the said owner is the land owner, the sharecropper is
entitled to the wage payable for similar work, and if the seeds owner shall be the sharecropper, the land
owner shall be entitled to the rent of a similar land.
2-In both instances, the wage or the rent of a similar work or land may not exceed the share value of its
owner in the crop.
PLANTED LAND SERVICING CONTRACT-3
)MUSSACAT(

Article 822
This service contract is one between a worker and the owner of trees or plants according to which the
worker undertakes to service the trees or plants for a determined period in consideration of a share in
common of the crop.

Article 823
The validity of this contract is contingent upon determining the share of each party to the agreement by a
proportion in common property.

Article 824
In order that this service contract be valid, the trees must be fruit bearing during the year of the contract,
the fruits are not ripened before the agreement and that the succeeding growth does not bear fruits prior to
reaping the previous one without interruption of the fruit bearing process. Should one of the afore-mentioned
three conditions be in default, the service contract of the above shall not be valid unless it is accessory to an
agreement fulfilling these conditions.

Article 825
If the service contract concerns trees to which plants are auxiliary thereto, or vice-versa, and the value of
the auxiliary is one third of the principal’s value or less, then the contract on the principal shall include the
auxiliary and the result shall be as follows:
First: The worker in a service contract shall be in charge of its servicing as he serves the principal.
Second: Its produce may not be conditioned to be the property of the principal or the worker.
Third: The share of the worker from this produce shall be similar to his share in the principal.
Fourth: The validity conditions of the servicing contract must be met as concerns the principal to the
exclusion of the accessory.

Article 826
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The servicing contract is binding and is not rescindable by one party without justifying excuse.

Article 827
1-The servicing contract should limited to the period of plucking off or to a time during which plucking off
usually occurs. If it is undetermined at the time of the contract then it shall be limited to the time when
plucking off is due, if the fruits are from one productive origin, or the first plucking off if from various and
different origins; provided that that the second plucking off takes place during the period of the
sharecropping. If the fruits come from several but not different origins, the term of the contract shall extend
to the last plucking off.
2- If a period has been fixed in the contract, during which there is probability for the fruits to blossom but
it did not show yet, none of the contracting parties may have a claim against the other.

Article 828
Unless otherwise provided, the works and expenses required for the servicing shall be subject to the
following provisions:
a- The works needed for the servicing of the trees, the growth of the produce and its quality and its
preservation until ripening such as irrigation, tree grafting and lopping shall be the task of the worker. The
fixed works, however, that does not reoccur each year, such as drilling wells, erecting warehouses, are the
responsibility of the trees and plants owner.
b- The pecuniary costs needed for the exploitation and ordinary care such as, the price of fertilizers, and
pesticides, until ripening of the produce, shall be the obligation of the owner of the trees or the plants.
c- As for the expenses needed after the ripening of the crop, like harvesting and storage expenses, these
shall be the liability of both parties, each one according to the proportion of his share in the produce.

Article 829
The worker may not assign his duties to third parties without the authorization of the owner of the trees or
plants, otherwise the said owner shall have an option to take all the crop, if he so wishes, and give the one
who executed the work the wages for performing similar works, or leave to them the produce and turn back
on the first servicing worker for the cost of a similar crop, in addition to damages for the prejudice sustained
as a result of his act.

Article 830
If the trees, the fruits, or the plants have become due to a third person and the two contracting parties to the
servicing contract, or one of them, have spent or taken action affecting the growth of the trees, fruits or plants
so, depending on the circumstances, the following shall result:
1-If the rightful owner has approved the servicing contract, he shall substitute the previous possessor in all
his rights and obligations, towards the worker, emanating from the contract and shall refund to the one who
has offered the trees or plants, an amount equal to the relevant and useful expenses customarily spent by him.
2-If the rightful owner did not approve the contract, which was made in good faith without knowledge of
either party of the reasons for entitlement, the entitled party may chose either to take what he is entitled to
and pay to the worker the price thereof, and to the one who has offered the trees or plants, the amount equal
to the useful expenses customarily spent by him; or leave the crop until the end of the season and take from
the one who has offered the trees or plants, a customarily adequate compensation for the benefits lost due to
such waiting period.
3-If both parties to the contract are of ill faith at the time of contracting, the beneficiary may take his dues
without liability towards any of them.
4-If one of them is of bad faith and the other acted in good faith, the latter may claim, from the rightful
owner, a compensation considered fair by custom for whatever his disbursements or work benefited the trees
or plants.

Article 831
If the worker fails to work, or if he is not entrusted with the fruits, the trees or plants, the owner shall be
liable for the wages payable for similar work executed prior to rescission.
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Article 832
1-The servicing contract shall not end by the death of the owner of trees or plants, and his heirs shall not
prevent the worker from resuming his work according to the contract.
2-Should, however, the worker die, his heirs may chose between terminating the contract and resuming the
work. If they chose termination of the contract, and the fruits did not yet ripen, they are entitled, upon
ripening, the share of these fruits that would have been for their decedent in proportion of his work until his
death.
3-If it has been provided that the worker has to execute the work in person, the servicing contract shall end
upon his death and his heirs shall be entitled upon ripening of the fruits, the share due to their decedent in
proportion to the work performed by him.

Article 833
In case the worker has shown negligence in the performance of the work assigned to him by agreement or
custom, his share in the crop shall be reduced in proportion to the neglected work.

Article 834
The provisions regulating the sharecropping contract shall govern the servicing contract in whatever has
not been provided for in the preceding articles.
PARTNERSHIP BETWEEN LAND AND PLANTS OWNERS -4
"THE "MUGHARASA

Article 835
"Mugharasa" is the participation between a land owner and the person who undertakes to plant specific
orchards, supplied by him, provided they become partners in the land and trees at a known percentage, if the
trees has reached a certain growth before bearing fruits.

Article 836
The validity of the "mugharasa" is contingent upon fulfilling the following conditions:
1-The mugharasa should be in fixed assets of palm trees or trees and not in seasonal recurring plantations.
2-The palm trees or trees, object of the mugharasa, must be determined at the time of formation of the
contract.
3-The shares in the partnership in both the land and the palm trees, or trees, must be determined.
4-The partnership, in land and palm trees or trees, shall start as from the date at which the trees reach a
certain degree of growth before bearing fruits.

Article 837
The provisions governing planted land servicing contract shall apply to Mugharasa in as much as they are
not in contradiction with its nature.
"RENTAL OF "WAKF -5
)ESTATES IN MORTMAIN(

Article 838
1-The one who is entitled to manage the "wakf" shall be in charge with its rental.
2-If two persons are entitled to manage the “wakf”, either one may not unitarily decide of its rental.

Article 839
1-The person entitled to administer the wakf may not lease it to himself, even in consideration of the
current rent, unless he has accepted the lease from the judge.
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2-He may let the mortmain property to his ascendants or descendants, for a rent higher than the current
rent, by permission of the judge.

Article 840
The beneficiary, even if he is the sole beneficiary, may neither grant a lease nor receive the rent unless the
right to do so is given to him by the constituent of the wakf, or he is so authorized by the person who is
entitled to grant a lease.

Article 841
1-The condition put forth by the constituent of the wakf must be observed in the lease, so if he fixes a
period for the lease, it should be complied with.
2-If no one accepts the lease for the specified period and the administrator of the wakf was not given the
right to lease for the period considered to the benefit of the wakf, the matter shall be brought forward before
the judge in order to authorize the lease for the period considered by him in the interest of the wakf.

Article 842
1-If the constituent of the wakf did not fix the lease period, the rent for shall, at most, be for one year for
immovable properties, and three years for the lands; unless otherwise required in the interest of the wakf and
permission of the judge, in this respect, has been granted.
2- Any lease entered into for a longer period, even by successive contracts, shall be reduced to the period
mentioned in the preceding clause.
3- In case the "wakf" is in need of construction and does not generate enough revenue, the judge may
authorize leasing it for a period sufficient for the purpose.

Article 843
1-The properties of the wakf may not be leased for a rent inferior to the current rent of similar properties
and any contract to the contrary shall be rescinded, unless the tenant agrees to pay the current rent for similar
premises and provided the interest of the wakf has been taken into consideration.
2-The estimation of the current rent for similar properties, at the time of formation of the contract, without
consideration of any change that may occur during the contracting period.

Article 844
If some improvement has occurred to the site, as such, where the wakf property is located, which has led to
an exorbitant increase of the current rent in the locality that is not attributable to the expenses incurred by the
tenant or the improvements done by him, the tenant shall have to opt either to terminate the lease or accept
the new current rent as of the time of such improvement, regardless of the fact whether the lease was made
for the purpose of construction or for any other purpose.

Article 845
1-If the lease period has expired, and the tenant has constructed or planted, out of his own money and for
himself, in the wakf property with the permission of the person in charge of letting, he shall then have the
priority over others for rental for a future period at the current rent of a similar property.
2-If he does not accept the current rent of a similar property, and the destruction of the construction or the
plucking of the trees shall be detrimental to the leased property, the wakf administrating body shall be
entitled to appropriate these additions at their cost after destruction or plucking, unless they agree with the
tenant to leave the construction or the plantation until it falls and the tenant shall be entitled to the rest of it.
3-The administrator may rent the property in mortmain, along with the construction and the plants, with the
consent of their owner provided the latter receives a share in the rent commensurate with his ownership
thereof.

Article 846

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If the rental period has expired, while the tenant has a construction erected or trees planted on the premises,
out of his own money, without permission, he shall be ordered to destroy what he has erected or pluck what
he planted, if not detrimental to the wakf, otherwise he shall have to wait until the construction or the trees
fall and he then be entitled to the remains thereof. In both instances, the Wakf Body is entitled to appropriate
what has been erected or planted at a price not exceeding its value destroyed or plucked, or standing as they
actually are, whichever is less.

Article 847
In matters requiring the permission of the judge, the opinion of the Ministry in charge of the wakf affairs
must be sought, prior to the issue of such permission, as to what is required in the best interest of the wakf.

Article 848
The provisions governing lease contracts shall apply to the lease of wakf, in as much as it is not in
contradiction with the preceding law provisions.

CHAPTER TWO

LENDING

SECTION ONE

GENERAL PROVISIONS

Article 849
Lending is to give others the right to appropriate, without valuable consideration the use of a specific thing
during a specific time or for a specific purpose, which thing the borrower undertakes to restitute after use.
The borrowed thing is the thing which usufruct has been appropriated.

Article 850
Lending is completed by receiving the borrowed thing, prior to which it shall have no effect.

Article 851
The borrowed thing must be specified, usable non-consumable, allowed for use even if not allowed for
sale.

Article 852
The lender must be the owner of the usufruct, even if he is not the owner of the borrowed thing itself and
he is not interdicted as to its use.

Article 853
The borrower must have the capacity to receive the loan.

Article 854
1-Should the lending period be restricted by a certain time or act, then the lender may not recover the
borrowed thing. If it is not restricted in time or the performance of an act, he is not entitled to restituting it
prior to the expiry of the period current in similar loans.
2-The lender shall recover it from the borrower, under all the circumstances, if it is used for a purpose
other than what it was loaned for, or if he experience an unexpected different need for borrowing.

Article 855

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The borrowed thing is a trust in the hands of the borrower, if it perishes or is lost or depreciated without
trespassing or negligence, there is no warrant by him, unless it has been agreed otherwise.

Article 856
The guardian or the custodian may not lend any property owned by his ward. If any one of them lent it, the
borrower shall be liable for the current rent for similar property, and if it perishes the borrower shall warrant
it.

Article 857
The wife may not, without the consent of her husband, lend anything owned by him, which is not usually
in her possession. If so she does, and the borrowed thing perishes or become defective, the husband may opt
either to sue her, or the borrower, in warrant.

Article 858
Unless otherwise agreed, when a person borrows a land for the purpose of erecting a construction, or
planting trees therein for a period limited by agreement or custom, then the lender shall have, at the end of
such period, the choice to ask the borrower to destroy the construction, or pluck off the trees and the leveling
of the land to its original condition, or to pay him the price of the construction or the value of the plucked off
trees.

Article 859
The lender is not entitled to claim, from the borrower, the rent of the borrowed thing after the utilization
thereof.

Article 860
1-If the borrowed thing has been dispossessed while in the hands of the borrower, the lender does not
warrant it, unless otherwise agreed or the reason for dispossession has been concealed on purpose.
2- The lender shall be responsible for every prejudice sustained by the borrower as a result of this
dispossession.
3- If dispossession takes place subsequent to the perishing of the borrowed thing while in the possession of
the borrower without trespassing or negligence from his part, and the dispossessor has chosen to ask for the
warrant, the borrower may claim from the lender what he warranted to the dispossessor.
4- The lender does not warrant against hidden defects, unless he has deliberately concealed such defects or
has warranted that the thing is free from defects.

SECTION TWO

OBLIGATIONS OF THE BORROWER

Article 861
1-The borrower is bound to take such care for the preservation and maintenance of the thing borrowed as
he would take for his own property; provided that the care he takes is not less than that which a reasonable
person would take of his property.
2-If he has neglected to drive away any prejudice to the borrowed thing, while he could do it, he shall be
bound to warrant.

Article 862
The borrower shall bear the charges of the borrowed thing and the expenses of its restitution and the fees
for its transportation.

Article 863

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1-The borrower may only use the thing lent in the manner common to absolute lending unlimited in time,
place or kind of use.
2-If it is limited by a period of time, or a place, he shall observe this restriction. If determined by kind of
use, he may not go beyond a similar and less prejudicial limitation.

Article 864
1-If, a defect occurs from the use of the thing borrowed which may devaluate it, the borrower shall not
warrant the amount of the devaluation unless it results from its use contrary to the current use.
2-If the borrower goes beyond what is customary in such loaning of the thing or in using it, thus resulting
in its perishing or defectiveness, he shall warrant to the lender any prejudice occurring to the thing.

Article 865
The borrower may not, without the permission of the lender, dispose of the borrowed thing in such a
manner as to give a right to someone in its use or its property by loaning, mortgaging, leasing it or otherwise.

Article 866
The borrower may deposit the borrowed thing with an honest person, capable of keeping it, and does not
guarantee it if it shall perish while under his control, without any breach a neglect.

SECTION THREE

TERMINATION OF LENDING

Article 867
Lending comes to an end by:
1-Expiration of the term agreed
2-Serving the purpose for which it was done
3-Death of the lender or the borrower, and shall not devolve to the heirs of the borrower.

Article 868
If the borrower dies without having knowledge of the lending and the thing borrowed was not found in his
estate, its value at time of death shall be consider as a debt on the estate.

Article 869
The borrower may restitute the thing lent before the end of the loan. If, however, such restitution is
prejudicial to the lender, he cannot be compelled to accept it.

Article 870
1-If the lending has been rescinded or expired, the borrower shall have to restore the borrowed thing to its
owner, and abstain from its utilization, unless the law has allowed him to keep it.
2-If it shall end by the death of the borrower, his heirs shall deliver it to the lender upon request.

Article 871
1-If the borrowed thing is a precious item, the borrower shall have to deliver it by himself to the lender.
Other things, however, may be delivered in person or through the intermediary of those under his
guardianship having capacity to act.
2-The borrowed thing must be restituted at the agreed place, otherwise in the place at which it was
borrowed, or customarily fixed.

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TITLE THREE

LABOR CONTRACTS

CHAPTER ONE

CONTRACT FOR WORK

SECTION ONE

DEFINITION AND SCOPE

Article 872
Contract for work is one by virtue of which one of the parties undertakes to do a piece of work in
consideration of a remuneration which the other party undertakes to pay.

Article 873
1-The contractor may undertake to supply the work only, the master of the work being responsible for the
supply of materials which the contractor uses in or for the performance of his work.
2-The contractor may undertake to supply the material and the work as well.

Article 874
In a contract for work, the location, the kind of work, its quantity, the way it should be performed and the
duration of work must be described and the remuneration fixed.

SECTION TWO

EFFECTS OF CONTRACTING
CONTRACTOR'S LIABILITIES -1

Article 875
1-In case the master sets forth as a condition that the contractor has to provide all or part of the materials,
he is responsible for its good quality as provided for in the contract, if any, otherwise in conformity with the
current custom.
2- When the materials are supplied by the master, the contractor is bound to care for their preservation,
observe in his work the technical requirements and to return to their owner whatever left of it; otherwise he
shall warrant against perishing, defect or loss thereof.

Article 876
In the absence of an agreement or trade custom to the contrary, the contractor shall provide, at his own
expense, the tools and accessories he needs to perform his work.

Article 877
The contractor shall perform his work according to the conditions of the contract. If it is established that he
is fulfilling his obligations in a manner that is defective or contrary to the agreement, the master may ask the
immediate rescission of the contract, if remedying the situation is impossible, otherwise the master may
summon the contractor to abide by the terms of the contract and rectify, within a reasonable time, the manner
in which he is performing the work. If at the expiration of the fixed delay, the contractor fails to comply with
this requirement, the master may ask the judge the resiliation of the contract or authorize him to hand over
the completion of the work to another contractor at the expense of the first contractor.
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Article 878
The contractor shall warrant the results of his act and work against prejudice or loss whether or not caused
by his trespassing or negligence. There is no warrant if this occurs from an accident that could not be
avoided.

Article 879
1-If the contractor's work shall produce some effects on the property, he may have a lien over it until he
receives the remuneration due to him, and if it perishes in his possession prior to payment of the
remuneration, he shall neither be liable to warrant nor entitled to remuneration.
2- If his work shall not have any effect on the property itself, she shall have no right to detain it in payment
of his remuneration and if he does so he shall be liable to warrant against his unlawful act.

Article 880
1-If the object of the contracting contract was the erection of buildings or other fixed constructions that the
architect has designed, to be executed by the contractor, under his supervision, they shall be jointly liable, for
a period of ten years or a longer agreed period , to indemnify the master of work for total or partial
destruction of these buildings or fixed constructions and for every defect endangering the solidity and
security of the building; all this unless the two contracting parties agreed that these constructions are meant to
stay for less than ten years.
2-This obligation to indemnify shall remain in effect even if the defect or the destruction is due to a defect
in the ground itself, and even if the master authorized the erection of the defective buildings or fixed
constructions.
3-The ten year period shall start as of the time of delivery of the work.

Article 881
If the architect’s work is limited to the preparation of the plans without being entrusted with the
supervision of their execution, he shall be responsible only for defects in the plans.

Article 882
Any clause tending to exonerate or limit the warranty of the contractor or the architect is void.

Article 883
Court action on the warranty may not be heard after three years from the occurrence of the destruction or
the discovery of the defect.
OBLIGATIONS OF THE MASTER -2

Article 884
The master must take delivery of the completed work as soon as the contractor completes it and places it at
his disposal. If the master, in spite of being formally summoned, fails without reasonable cause to take
delivery, and the work perishes in the hands of the contractor or becomes defective, without any trespassing
or neglect from the latter, he shall not be bound to warrant.

Article 885
The master is bound to pay the remuneration for the work upon taking delivery of the work contracted,
unless otherwise agreed or practiced by custom.

Article 886
1-When a contract is concluded in accordance with an estimate drawn up on a unit price basis and it
becomes evident, during the course of the work, that it will be necessary to complete the work, according to
the agreed plan, to considerably exceed the estimated price, the contractor is bound to notify the master

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forthwith of the matter stating the anticipated increase in price. If he fails to do so, he shall forfeit his right to
recover the expenses incurred in excess of the estimate.
2-If the estimated excess in the price for the execution of the plans is considerable, the master may release
himself from the contract and stop the execution without delay and pay the contractor the cost of the works
done by him estimated in accordance with the terms of the contract.

Article 887
1-When a contract is concluded on a lump sum basis according to an agreed plan, the contractor has no
claim to an increase in price required for the execution of the plan.
2-If a modification or addition is made to the plan, with the consent of the master, the current agreement
with the contractor, as regards such a modification or addition, shall be observed.

Article 888
If the contract did not specify a price for the work, the contractor shall be entitled to the price for similar
works, in addition to the cost of the materials provided by him as required by the works.

Article 889
1-If there were no agreement as to the remuneration of the architect, who made the plans for the building
and supervised their execution, he shall be entitled to the remuneration payable for similar work, in
accordance with the current custom.
2- If happens what impedes the completion of the work’s execution, according to the design he has
prepared, he shall deserve the wage according to what he has performed.

SECTION THREE

SUB-CONTRACTING

Article 890
1-The contractor may entrust the execution, of the whole or part of the work, to a sub-contractor unless he
is precluded from so doing by a clause in the contract, or unless the nature of the work requires that he
executes the work in person.
2-The contractor, in such a case, shall remain responsible towards the master of the work.

Article 891
The subcontractor may not have a claim against the master, as regards the dues of the first contractor,
unless the latter refers him to the master.

SECTION FOUR

THE END OF A CONTRACT FOR WORK

Article 892
The contract for work shall come to an end by completing or by rescission of the contract by mutual
agreement or by order of the court.

Article 893
When an excuse arises that prevents the execution of the contract, or the completion of its execution, any
of the contracting parties may ask for its rescission or termination, as the case may be.

Article 894

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If the contractor has started the execution of the work and then became unable to accomplish it, for a
reason beyond his control, he shall be entitled to value of the completed work, in addition to the expenses
disbursed for its execution to the extent of the benefit that the masters derives from such work.

Article 895
The party prejudiced from rescission may claim compensation from the other party within the limits
allowed by custom.

Article 896
1-A contract for work is dissolved by the death of the contractor, if it was agreed that he executes the work
in person or if his personal skill was taken into account in the contract.
2-If the contract does not include such provision, or if such personal skill was not taken into account in the
contract, the master may ask for the rescission of the contract in case the heirs do not offer the necessary
qualifications for the proper execution of the works.
3- In both instances, the value of the completed works and the expenses incurred shall devolve to the heirs
in accordance with the contract and what is required by custom.

CHAPTER TWO

EMPLOYMENT CONTRACT

SECTION ONE

FORMATION AND CONDITIONS

Article 897
1-An employment contract is a contract whereby one of its parties undertakes to perform some work to the
benefit of the other party under his supervision and administration, in consideration of a salary which other
party undertakes to pay.
2-If, however, the wage earner is not prohibited to work for another employer, or if he is not tied up in his
work by a specific time to the benefit of the employer, the employment contract does not apply to him and he
is entitled to his remuneration in accordance with the agreement.

Article 898
1-The employment contract may be for a limited or unlimited period, and for a specific work.
2-If the employment contract is for the lifetime of the employee or of the employer or for more than five
years, the employee may, after the lapse of five years, terminate the contract, without indemnity, provided
that he notifies the employer six months beforehand.

Article 899
The employment period shall start as of the time fixed in the contract, otherwise as of the date of the
contract, unless the custom or the circumstances of the contract otherwise provide or require.

Article 900
1-Should the employment contract be for a limited period, it shall automatically come to an end by the
expiry of its term and if both parties thereto continue its execution, this shall be considered as renewal for an
unlimited period.
2-In case the employment contract is for the execution of a specific work, it shall end by the achievement
of such work. If this work is renewable by its nature, and the execution of the contract continues, after the
completion of the work agreed upon agreed upon, the contract shall be considered tacitly renewed for the
period required for the performance of the same work anew.

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Article 901
1-The employee’s salary is what he receives under the contract in money or benefit of any kind.
2-If the salary is not fixed in the contract, the employee shall be entitled to get a wage in accordance with
the rates, if any, applicable to work of similar nature, otherwise the judge will fix it according to the
requirements of equity.

Article 902
1-The following sums form an integral part of an employee’s salary and are taken into account in
computing the attachable portion thereof:-
a-Commissions payable to canvassers, commercial travelers and commercial representatives.
b- Percentages payable to employees of commercial establishments on the price of sales effected by them
and high cost of living allowances paid to them.
c- Any gratuity paid to a worker in addition to his salary, as well as fidelity bonuses pr increase in his
family charges and other similar allowances, if payment of such sums is provided in the individual contract
of employment or in factory regulations or if these sums are customarily payable so that the employee
considers these as forming part of his salary and not a bounty, provided that these amounts paid are of known
value before the attachment is made.
2-Tips are deemed to be part of the salary only in industries or trades where it is customary to pay tips and
where tips are subject to regulations by which they can be controlled.
Tips are deemed to form part of the employee’s salary when the amounts given as tips by customers of a
particular commercial establishment to its employees are collected in a common fund for distribution to the
workers by or under the supervision of the employer.
In some industries, such as hotels, restaurants, cafés and bars, an employee’s salary may consist solely of
the tips received and the food he consumes.

Article 903
If someone performs a work for another, upon his request and without agreement as to the remuneration,
he shall be entitled to the salary payable for similar work, if he is salaried, otherwise he is not entitled to any
salary.

Article 904
If the work under contract is teaching something which may be of some assistance from the instructed
person to his instructor, and it is not mentioned in the contract who deserves the remuneration from the other
party, the custom, in effect between those concerned at the place of work, shall be followed.

SECTION TWO

EFFECTS OF THE EMPLOYMENT CONTRACT

THE EMPLOYEE’S OBLIGATIONS -1

Article 905
The employee must:
1-Perform in person the work and use, in so doing, the care of an ordinary man.
2-Observe, in his conduct the requirements of tact and morality.
3-Obey the orders of the employer relating to the performance of the agreed work in all what does not
expose him to danger and does not violate the law or morality.
4-Preserve with care things entrusted to him for the performance of his work.
5-Safeguard the industrial or commercial secrets of the work, even after the expiration of the contract, as
required by the agreement or customarily practiced.

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Article 906
The employee shall be bound by all that is customarily considered as an accessory of the work even if not
so provided in the contract.

Article 907
The worker may not engage himself, during his work time in anything else nor work, during the period of
his employment contract, for another employer, otherwise his employer may either rescind the contract or
reduce the wage in proportion to the employee’s negligence in discharging his work.

Article 908
The employee warrants whatever shortage, perishing or missing that may affect his employer’s property
due to his negligence or trespassing.

Article 909
1-When the work entrusted to the employee enables him to have knowledge of the secrets of his
employer’s business or to know the clients of the establishment, the parties may agree that the employee will
not be entitled, after the termination of the contract, to compete with the employer or participate in a
competitive business.
2-Such agreement shall not be valid unless it is limited as to time, place and kind of work, to the extent
necessary for the protection of the legitimate interests of the employer.
3-The employer may not avail himself of such an agreement if he terminates the contract without any cause
attributable to the employee; nor can he avail himself of such agreement if he himself has given the employee
adequate grounds to resiliate the contract.

Article 910
If both parties agree to hold the employee liable in case he commits a breach of a condition restraining
competition and this clause is so onerous as to act as a pressure on the employee to compel him to remain in
the service of his employer, the condition will not be valid.

Article 911
1-When the employee discovers a new invention or discovery while in the service of his employer, the
latter will not be entitled to it except in the following instances:
a- In case the nature of the work agreed to aims to attain such purpose.
b- If the contract expressly stipulates that the employer is entitled to any invention reached at by the
employee.
c- When the employee realizes his invention through the materials, tools, constructions or other means put
at his disposal by the employer for this purpose.
2- If, however, the invention or discovery, in the foregoing instances, is of serious economic importance,
the employee may ask for a special remuneration to be fixed in accordance with the principles of equity,
taking into account the extent of help supplied by the employer.
The above provisions will be without prejudice to the provisions of the laws on inventions and discoveries.
OBLIGATIONS OF THE EMPLOYER -2

Article 912
1-The employer must pay the employee his salary as agreed whenever he performs his work or when he
prepares and devotes himself to it, in case no work has been assigned to him.
2-Payment of the salary to the employee will be at the time and place fixed in the contract or established by
custom.

Article 913
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The employer will:

a- Make available all the means of security and safety in his establishment and provide all what is
necessary to enable the employee fulfill his obligations.
b- Make sure that the machines and the apparatuses used for work are in proper running condition so that it
does not cause any prejudice.
c- Observe the requirements of morality and politeness in dealing with his employee.
d- To give to the employee, at the end of his service, a certificate mentioning the kind of his work, the
starting and ending dates of his service, the amount of his salary as well as of all additions thereto paid to
him.
e- Give back to the employee all his personal papers.

Article 914
If the employer asks another person to perform a work against reward, he shall be bound to pay him a
salary equal to that payable for similar work, whether this person is a wage earner or not.

Article 915
The employer will have to provide food and clothing for his worker, if customarily established, whether
this condition is mentioned in the contract or not.

Article 916
If the period fixed for work has expired and there is a reason justifying its extension, the contract shall
continue to run as long necessity so require and the employer shall be liable to pay a salary equal to that
payable for such extended period.

Article 917
When the term of work is fixed in the contract, and the employer rescinds the contract before its expiry,
with no valid excuse or a defect in the work performed by the worker, he shall have to pay him the salary due
until the end of such period, if the worker has made himself available for service within it.

Article 918
Each of the employer and employee shall perform the obligations imposed by the special laws, side by side
with the obligations stipulated in the above articles.

SECTION THREE

END OF THE EMPLOYMENT CONTRACT

Article 919
1-Subject to the provisions of articles 898 and 900, a contract of employment ends at the expiration of the
term fixed unless renewed, or upon completion of the work agreed upon.
2-When the duration of the contract is not fixed by the agreement or by the nature of the work or by its
object, each of the contracting parties may terminate the contract at any time provided it is preceded by a
notice to the other party of his intention to do so within a reasonable time prior to the expiration of the
contract.

Article 920
1-When a cause arises preventing its execution, the contract may be rescinded.
2-Should any of the contracting parties has an unexpected excuse concerning him, he may ask for the
rescission of the contract.
3-In both mentioned instances, the party asking rescission shall be liable for the prejudice caused by
rescission to the other party.
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Article 921
The contract shall end by the death of the employee as well as of the employer in case the personality of
the latter has been taken into consideration upon conclusion of the contract.

Article 922
1-Actions arising out of a contract of employment are prescribed after one year from the time of
termination of the contract.
2-Actions in relation with the disclosure of trade secrets are not subject to such limitation.

Article 923
1-Unless governed by a special provision, the contract of employment shall be governed by the same
provisions applicable to lease contracts.
2-The provisions of the employment contract shall not apply on workers governed by the labor law, except
to the extent at which it does not expressly or impliedly contradict the laws applicable to them.

CHAPTER THREE

MANDATE

SECTION ONE

GENERAL PROVISIONS

Article 924
A mandate is a contract whereby a principal appoints a proxy on his behalf to perform a licit and known
act.

Article 925
1-The conditions for the validity of the mandate are the following:
a-The principal must have the right to dispose by himself of the acts constituting the object of the mandate.
b- The proxy must not be prohibited from disposing of what he has been empowered to perform.
c- The object of the proxy must be known and apt to be given by proxy.
2-A power of attorney in litigation is not conditioned upon acceptance of the other party to the litigation.

Article 926
A mandate may be absolute, restricted or made subject to a condition precedent or deferred for a future
time.

Article 927
1-The mandate is special if it is restricted to one or more specific matters; it is general if it comprises all
matters which can be entrusted to a proxy.
2-If a special mandate, it confers on the proxy a power to act in matters specified therein and in matters
necessarily incidental thereto as required by the nature of each matter mandated and prevailing custom.
3-If general, it empowers the proxy to perform all acts of exchange and disposal, gratuities being excepted
and requires a specific mention authorization.

Article 928
A mandate given in general terms, which does not specify the intended meaning thereof, only confers on
the proxy the power to perform acts of management and preservation.
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Article 929
Any act that is not one of management or preservation requires a special mandate specifying its nature and
all acts incidental thereto as required in the mandate.

Article 930
The subsequent ratification of the act shall be considered as a prior mandate.

SECTION TWO

EFFECTS OF A MANDATE
DUTIES OF THE PROXY -1

Article 931
The mandate shall confer to the proxy the power to dispose of all matters included therein without
exceeding its limits except if more benefic by virtue of the contracting contract, the agent shall be fixed the
charge of disposing in what shall be entertained by the agency, without exceeding the limits thereof unless in
whatever shall be more beneficial to the principal.

Article 932
1-If the mandate is gratuitous; the proxy must exercise in its performance the degree of care he gives to his
own affairs.
2-When the mandate is for remuneration, the proxy must exercise in its performance the diligence of a
reasonable man.

Article 933
1-When several proxies are appointed by virtue of a separate contract, each one of them may act
independently within the limits of the mandate issued to him except when the principal provides otherwise,
then none of them may act independently and their independent act shall not bind the principal.
2-When several proxies are appointed by the same document without being authorized to act severally,
they must act jointly except in cases where a unanimous decision cannot be reached, such as litigation,
without an exchange of views with the other co-proxies, or where an exchange of views is not essential, such
as receiving a payment or paying a debt.

Article 934
1-The proxy may not appoint a substitute to perform all or part of the acts mandated unless he is permitted
to do so by the principal or authorized to follow his opinion. In this case the substitute shall be considered as
a proxy to the principal.
2-When the proxy is authorized to appoint a substitute without specifying the person, he is liable towards
his principal for his faulty choice in appointing the substitute or for faulty instructions he has given to him.
3-In a special mandate the proxy, if overloaded by his work, may mandate another person to assist him but
not to act independently.

Article 935
Contracts of donation, lending, pledging, deposit, loaning, partnership, speculation and compromise upon
denial, contracted by the proxy, if not attributed to his principal are not valid.

Article 936
1-Contracts of sale, purchase, rent, compromise upon avowal are not necessarily added to the principal
within the mandate; but if the proxy attributes these to the principal within the limits of the mandate, they
shall be for the account of the principal and, if added to him without declaring that he is contracting in his
capacity of proxy, the rights deriving from the contract shall be his.
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2-In both instances, the ownership shall be established to the principal.

Article 937
Monies collected by the proxy for the account of his principal shall be considered as a deposit not
guaranteed by him if it perishes in his hands without negligence from his part.

Article 938
The proxy empowered to receive money has no power to litigate and the proxy for litigation has no power
to receive money, except with a special authorization from the principal.

Article 939
In litigation a party may not mandate an enemy of his rival.

Article 940
1-A proxy asked to purchase a thing without mention of the price may buy it at the price paid for a similar
thing, or even at a little higher price in things that do not have a specified price.
2-If he purchases with a small disadvantage in price a thing that has a specified price or at a considerably
disadvantageous price, the contract may not be enforced against the principal.

Article 941
1-The proxy mandated to purchase a specific thing may not buy it for himself and if he does, the purchase
shall be for the account of the principal even if he declares that he purchases it for himself.
2-The proxy mandated to purchase may not sell to his principal something that he owns.

Article 942
The purchase shall be for the proxy’s account if:
a- The principal has specified and the proxy bought for a higher price.
b- The agent bought at a considerably disadvantageous price.
c- He declared that he is purchasing the property for himself, in the presence of the principal.

Article 943
1-If the proxy for purchase has paid the price of the thing sold from his own funds, he is entitled to claim
from his principal what he has spent, within the normal standards, in implementation of his mandate.
2-He may retain what he has bought until he receives its price.

Article 944
1-The proxy, who has been mandated, in an absolute manner, to sell the property of his principal has to sell
it at a suitable price.
2-If the principal has fixed the price of the thing sold, the proxy may not sell it at a lower price.
3-In case he sold it at a lower price without a prior authorization, or a subsequent ratification of the
principal, and delivered it to the purchaser, the principal shall be at option either to retrieve the sold thing or
ratify the sale or recover from the proxy the difference in price.

Article 945
1-The proxy mandated to sell may not buy for himself what he was mandated to sell.
2-He may not sell it to his ascendants, descendants, spouse or to whomever such an act may draw benefit
or cause a loss, except at a price higher than the price paid for similar things. He may sell to those mentioned
at the price payable for similar things, if he was mandated to sell to whomever he wishes.

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Article 946
1-If the proxy mandated to sell is not bound to sell in cash, he may sell the property of his principal either
in cash or on credit basis as customary.
2-If the proxy sells it on credit, he may take a pledge or ask for a surety to the buyer for what he sold on
credit even if the principal did not mandate him to ask for these.

Article 947
1-The principal has the right to receive the price of the thing sold from the purchaser even if this right is
given to the proxy and the purchaser may pay it to the principal and payment to him discharges the purchaser
from liability thereto.
2-If the mandate is gratuitous, the proxy is neither bound to obtain payment of the price of the thing sold
nor collect it but only to give authority to his principal to receive it or collect it.
3-If the proxy is remunerated; he is bound to obtain payment of the price and to collect it.

Article 948
The proxy is bound to give to his principal all necessary information in connection with the execution of
his mandate and render him an account thereof.
THE PRINCIPAL'S OBLIGATIONS -2

Article 949
The principal shall have to pay the agreed remuneration to the proxy whenever he executes the work
assigned to him. In case there is no agreement as to the remuneration and the proxy is one of those who work
for remuneration, he shall be entitled to the remuneration usually paid for such work, otherwise he shall be
considered acting gratuitously.

Article 950
The principal has to reimburse his proxy the expenses incurred by him to the extent usually accepted in the
implementation of a mandate.

Article 951
1-The principal shall be bound by all the rights to which his proxy is entitled on account of executing the
mandate in the usual manner.
2-He shall be answerable for all the prejudice sustained by his proxy because of the normal execution of
his mandate, unless such is the result of his negligence or mistake.

Article 952
1-If the principal orders somebody else to pay his debt from his own funds and this other person did, this
shall be considered as a mandate and the ordered person may claim back from the orderer what he has paid,
whether the latter has, or not, conditioned payment upon reverting back on him.
2-If he has ordered him to cover the principal’s expenses or those of his parents or children, the person who
was given such order may claim back the amount known to be actually spent, even if reverting back on the
debtor was not provided as a condition.

Article 953
The provisions governing representation in contracts, provided for in the present Law, apply to the
relationship of the principal and the proxy with the third party dealing with the proxy.

SECTION THREE

THE END OF A MANDATE

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Article 954
The mandate comes to an end by:
a-The completion of the mandated work it;
b-The expiration of the period for which it was given.
c-The death or incapacity of the principal, even if the mandate confers a right to a third person, except as
concerns the mandate to sell the mortgaged property if the mortgagor has mandated the court or the
mortgagee to sell the mortgaged property upon expiration of the term thereof.
d-The death or incapacity of the proxy, even if the mandate confers a right to a third person. However, the
heir or the guardian, should he have knowledge of the mandate and be of full capacity, must give notice of
the death to the principal and take all necessary measures dictated by the circumstance in the best interest of
the principal.

Article 955
The principal may, at any time he wishes, revoke his proxy or limit his powers unless the mandate confers
a right to a third person or is issued in the interest of the proxy and, in such case, the principal may not end or
limit the mandate without the consent of the person in whose interest the mandate was.

Article 956
The principal shall indemnify the proxy for the prejudice sustained as a result of an untimely or unjustified
revocation.

Article 957
The proxy may renounce his mandate which does not confer a right to a third party. He has to notify his
principal of this renunciation and carry through any work he has commenced to such a condition that it does
not expose the principal to prejudice.

Article 958
1-If the mandate is against remuneration, the proxy warrants indemnifying the principal from whatever
prejudice resulting from his untimely or unjustified renunciation.
2-If the mandate confers a right to a third party, the proxy must carry through the mandated work unless
there are serious reasons justifying his renunciation. In such a case, he shall have to notify the right owner,
and wait for a period within which the latter shall have time to protect his right.

Article 959
The proxy in litigation shall be revoked if he acknowledges something on behalf of his principal outside
court sessions or, if the avowal being excluded from the mandate, he avows in or out of court.

Article 960
If the proxy in litigation disposes of whatever he was mandated to after taking knowledge of his
revocation, he shall be liable to indemnity and if he disposes of it prior to such knowledge, his act shall be
enforceable.

Article 961
The mandatory of a proxy is revoked by the death or bankruptcy of the original principal and by his
revocation from the part of the principal or the proxy who mandated him, but shall not be revoked by the
revocation or death of the original proxy.

CHAPTER FOUR

CONTRACT OF DEPOSIT

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SECTION ONE

GENERAL PROVISIONS

Article 962
1-Deposit is a contract whereby one person to take delivery from the depositor of a thing which he
undertakes to keep in safe custody and return in kind.
2-The thing deposited is the property deposited with a trustee for safe keeping.

Article 963
The validity of the contract is conditioned upon the thing deposited being a property that can be controlled
by possession.

Article 964
Deposit is completed by taking possession of the thing deposited de facto or de jure.

Article 965
The depository is neither entitled to claim remuneration for keeping the thing deposited nor a rent of the
premises where it is kept, unless provided for upon depositing or practiced by special custom.

SECTION TWO

EFFECTS OF THE CONTRACT

OBLIGATIONS OF THE DEPOSITORY -1

Article 966
The thing deposited is put in trust under the control of the depository. Unless otherwise agreed, he is liable
to indemnity if it perishes because of his act or negligence in keeping it

Article 967
1-The depository is bound to exercise in the custody of the thing deposited, the care which an ordinary
person employs in his own affairs; he has to put it under similar custody.
2-He shall preserve it in person or by one of his dependents with whom he can entrust his own property.

Article 968
1-The depository may not deposit the thing in his custody with a third person without permission of the
depositor unless he is compelled to do so but he has to recuperate it upon the cessation of such compelling
cause.
2-If he has deposited it with somebody else, with the consent of the depositor, he shall be liberated from
his obligation and the third person shall be the depository.

Article 969
The depository may not utilize the thing deposited or confer to others a right thereon without authorization
of the depositor; if he does so and it perishes or devaluates, he is liable to indemnity.

Article 970
If the depository shall travel taking with him the thing deposited without authorization of the depositor,
while he was able to deposit it in the custody of another person, and the thing deposited perishes or

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deteriorates he shall be liable to indemnity. If he travels with it because he did not find another custodian to
leave it in his custody, and it perishes or is lost without fault imputable to him, he is not liable for indemnity.

Article 971
1-If the depositary has borrowed the thing deposited or traded therewith, without the consent of the
depositor, he shall warrant it and shall not be discharge therefrom except by restituting a similar thing to the
place of deposit, if fungible, or by paying its value to the depositor and not to the place of deposit, if
valuable. The depository shall be entitled to the profit in case of trading it.
2-In case of borrowing or trading therewith with the consent of the depositor, it shall cease to be a deposit
and become a debt on the depository of which he will not be discharged unless he returns a similar thing, if
fungibles, or the value thereof, if ad valorem, to the depositor and not to the place of deposit.
3-If he has borrowed some of the thing deposited or traded therewith, he shall warrant this part as detailed
above, as the case may be, and the other part shall remain on deposit.

Article 972
1-The depository is bound to return the thing deposited and deliver it to the depositor at the place of
deposit, unless the contract includes a condition stipulated in the interest of both parties to the contract, or
one of them, and in this case the condition required should be observed.
2-If the thing deposited has perished or being devaluated, without breach or negligence on the part of the
depository, he shall have to give to the depositor whatever warranties obtained by him and transfer to him
whatever rights obtained against third persons he may have acquired as a result thereof.

Article 973
The depository shall have to restitute the benefits and yields of the thing deposited to the depositor.

Article 974
If the thing deposited perishes in the hands of the depository, even due to his fault, he has to cover the
damages.

Article 975
1-If the depository intermingles the thing deposited with a thing which could not be distinguished
threrefrom and is not similar in kind or character, he shall warrant it as soon as it is mixed; but there is no
warranty from his part if it can be distinguished or if it is similar in kind or character.
2-In such instance, if some of the mixture has been deteriorated, the warranty shall be apportioned
according to their share in this mixture until the deteriorated part could be distinguished, then the warranty
shall be on the owner of this part specifically.

Article 976
If the thing deposited is lost or stolen from the depository, due to non-observance of the method of its
preservation as prescribed in their agreement or customarily followed for the preservation of similar things;
or due the fact that he forgot it in a place where he left it or if he took it with him in a place while he could
have put it at his home or with a trusted person before entering such place. In all the above cases he is bound
to warrant it.

Article 977
1-If the depository takes the thing deposited with him to return it to the depositor, or if he forwards it to
him, without his consent in both cases, then it perishes or is lost by him or by the messenger in charge of
forwarding while in his way to the depositor, he shall be liable of its warranty.
2-In case of litigation as to whether or not the authorization was given, the statement of the depositor given
under oath shall prevail.

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Article 978
1-If the depository pretends the deterioration or loss, without fault from his part, of the thing deposited, he
shall be believed and in case the depositor accuses him of prevarication or insist that he is a liar, he shall have
to administer oath on him. If he refuses to take the oath, in case of accusing him of prevarication, he shall
warrant the thing deposited as soon as he refuses to swear, but the oath shall not be tendered back to the
depositor. In case the depository refuses to take the oath, in case of assertion that he is a liar, he shall not
warrant the thing deposited unless he tenders back the oath to the depositor who shall have to swear that the
depository is a liar.
2-If, upon depositing, the depositor has provided as a condition that he will not take oath in the case of
deterioration or loss, this condition shall have no effect.

Article 979
If the depository, upon claiming the thing deposited from him, denies having received it and the depositor
submits a proof that he received it but the depository alleges that he has returned it to him, or that it
deteriorated without fault from his part, he shall warrant the thing deposited and any allegation from him as
to its restitution or deterioration shall not be admitted.

Article 980
Where there are several depositories, and the thing deposited is indivisible, it may be kept by one of them
with the consent of the others or by each successively.
In case it is divisible, it may be partitioned between them and each shall keep his share in deposit
respectively.

Article 981
If the depositor has been absent in intermittent intervals, the depository must continue to preserve the thing
deposited until proof of his death or his being alive is established. Should the thing deposited be subject to
perishing during the waiting period, he shall have to secure the authorization of the court to sell it and keep in
deposit the proceeds with the court treasury.

Article 982
1-If two persons have deposited a joint property with another, and one of the depositors has asked the
depository to restitute his share, in the absence of the other, he shall have to restitute it, if among fungibles;
otherwise he shall turn down the request until acceptance of the other depositor.
2-If the thing deposited is subject of dispute between them, he shall abstain to restitute it to one of them
without the consent of the other or a court order.

Article 983
1-In case of death of the depository and the thing deposited was in kind among the assets of his estate, it
shall be considered in trust with the heir who shall nave to return it to its owner.
2-If it was not found in kind, then there shall be no warranty on the estate if:
a-The heir establishes that the depository has stated the status of the thing deposited such as restituted by
him, perished or lost without breach or negligence from his part.
b-The heir recognized and described it and stated that it was lost or has perished after the death of
decedent, without breach or negligence.
3- If the depository dies without identifying the thing deposited, and it was not found in his estate, it shall
be considered a debt on the estate and its owner shall share the other creditors in his claim.

Article 984
1- If the depository dies and his heir has sold the thing deposited and delivered it to the purchaser after
which it perished, the owner thereof shall have the choice either to claim its price on the date it is sold, if non
fungible, or claim a similar thing, if fungible.

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2- If the thing deposited was still in the hands of the purchaser, its owner shall be at choice either to take it
back and reject the sale or approve the sale and take the price thereof.

Article 985
If, among the estate of a decedent, it was found a thing on which it was written in the handwriting of the
decedent or the depositor that it is a deposit with indication of its owner and the quantity thereof and was
found partly missing, the missing part shall be taken from the estate if it is made known that he has disposed
of the thing deposited.
OBLIGATIONS OF THE DEPOSITOR -2

Article 986
The depositor is bound to pay the agreed remuneration, in case the deposit is made against remuneration.

Article 987
1-The depositor must repay the expenses, authorized by him, incurred by the depository for the
preservation of the thing deposited.
2-If the depositor was absent, the depository may bring the matter to the attention of the judge to order as
deemed convenient by him

Article 988
1-If the depository has spent on the thing deposited without the consent of the depositor or the permission
of the judge, he shall be considered as a donor.
2-The depository may, however, in necessary or urgent cases, spend on the thing deposited, an amount
customary acceptable, and claim from the depositor what he has spent out of his own funds.

Article 989
1-The depositor shall bear the expenses of restituting the thing deposited as well as the delivery expenses.
2-He shall have to indemnify the depository against any loss he may incur as a result of the deposit unless
such loss resulted from his trespassing or neglect.

Article 990
If the thing deposited has been the object of a dispossession, the depository shall be entitled to refer back
on the depositor for what he had warranted

Article 991
In case of death of the depositor, the thing deposited shall be delivered to his heir, unless his estate is
covered with debts and, in this case an authorization of the court in this respect becomes necessary.

SECTION THREE

CERTAIN KINDS OF DEPOSITS

Article 992
When the object of the deposit is a sum of money or another thing of a consumable nature and the
depository has been authorized by the depositor to make use of it, the contract is deemed a loan contract.

Article 993
1-The deposit of effects brought in by guests of hotels or similar establishments is warranted by the
proprietors of these establishments who are responsible for any loss or shortage occurring thereto.

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2-As regards articles of value, sums of money or securities they shall not be warranted, without breach or
neglect, unless the owners of such establishments accept to keep these valuables, having knowledge of their
value, or unless they have refused, without just cause, to keep them, or if the loss has been caused by their
gross negligence or by the gross negligence of one of their staff, then they shall be covered by a warranty as
customarily practiced.

Article 994
1-Hotel guests, or those of similar establishments, shall have to inform the proprietors of such
establishments of their effects, lost or stolen, prior to their departure from the establishment.
2-Action in warranty of what has been lost or stolen shall not be heard after the lapse of six months as of
the date of departure from the establishment.

Article 995
1-Each of the depositor and the depository, may terminate the contract whenever he so wishes, provided
that such termination shall not at an inconvenient time.
2-However, if the deposit was made against remuneration, neither of them may terminate the contract prior
to the expiry of the deposit period but the depositor is entitled to ask for the return of the thing deposited at
any time if he pays the entire balance of the remuneration and provided that there is no condition to the
contrary.

Article 996
1-If the depository is stricken by an insanity from which there is no hope of recovering his senses and the
depositor establishes against the tutor or guardian that the deposit was made, so if the thing deposited is still
there in kind it shall be restituted to its owner, otherwise the depositor shall recover its value from the funds
of the insane provided he has a solvent surety.
2-If the depository shall recover his senses and alleges that he had returned the thing deposited or that it
perished without breach or negligence from his part, his oath in this respect shall prevail and he may ask the
refund of the amount taken from his funds or from his surety in lieu of the thing deposited.

CHAPTER FIVE

CUSTODY CONTRACT

SECTION ONE

GENERAL PROVISIONS

Article 997
Custody is a contract whereby the two parties in dispute entrust to a third party a property to be
safeguarded and managed and returned together with its yields to whoever establishes his right thereto.

Article 998
If the two contracting parties agreed to put the property under the control of two or more persons, none of
them may separately keep it or dispose of its income without the consent of the others.

Article 999
In case of disagreement, the two parties to the dispute may ask the judge, in order to prevent an imminent
danger, or for a just cause, to appoint a custodian to take delivery of the property to preserve and manage it,
and authorizing him to exercise any right, which the judge shall deem it in the interest of both parties.

Article 1000

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In case it is revealed that custody is indispensable to preserve the rights of those concerned judicial custody
may be imposed on the property in mortmain in the following cases:
1-If the property in mortmain is vacant or a conflict arose between those in charge of such property or by
one of them and the Nazir, or when an action for the removal of the Nazir. In such cases the custody ends
upon appointment of a Nazir to the Wakf, whether such appointment is provisional or definite.
2-When the Wakf is in debt.
3-When one of the beneficiaries of the Wakf is bankrupt, and that custody has been revealed to be
necessary for the protection of the rights of the creditors, then custody will be ordered in respect of his share
alone unless it is impossible to isolate it, otherwise custody will be ordered in respect of all the property in
mortmain.

Article 1001
If the parties to the dispute fail to agree on the person of the custodian, the judge shall appoint him.

SECTION TWO

OBLIGATIONS AND RIGHTS OF THE CUSTODIAN

Article 1002
Property under the control of the custodian shall be held in trust, and he may not exceed, in his mission, the
limits set up for him, otherwise he shall incur liability.

Article 1003
The rights, obligations and powers of the custodian are defined in the agreement or in the judgment
ordering custody. In the absence thereof, the provisions relating to deposit and mandate will apply in so far as
they do not conflict with the provisions stated in the present chapter.

Article 1004
The custodian is bound to ensure the preservation and administration of the property entrusted to him with
the diligence of a reasonable person.

Article 1005
Apart from acts of preservation and administration, the custodian must not act without the consent of the
parties to the dispute or without authorization of the judge unless there is an urging necessity that shall
endanger the produce or the movable property subjecting it to deterioration or perishing.

Article 1006
The custodian is bound to provide the interested parties with all necessary information relating to the
implementation of his task and to render accounts thereof within the delays and by the means agreed upon by
the parties or ordered by the judge.

Article 1007
The custodian must render accounts of the amounts expended during the performance of his mission,
taking into consideration reasonable amounts spent in similar situation by another source.

Article 1008
If the custodian provided as a condition that his work be remunerated, he shall be entitled to such
remuneration upon completion of his task, and if he did not put such a condition, but he is one of those
working against remuneration, he shall be entitled to the similar wage payable in similar situations.

Article 1009
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The custodian may resign his task at any time provided he informs the concerned persons and carry on the
works he started until reaching a stage where it shall not prejudice the parties to the dispute.

Article 1010
In case of death of the custodian, his inability to perform the duties entrusted to him, or in case a dispute
arises between him and one of the concerned persons and the parties did not agree on naming a substitute, the
judge shall appoint a custodian of his choice upon request of one of the parties in order to resume
performance of the unaccomplished task.

SECTION THREE

END OF CUSTODY

Article 1011
The custody comes to an end upon completion of the work or by agreement of all the interested parties or
by decision of the judge. The custodian must then forthwith restitute whatever has been entrusted to him to
the person agreed upon by the concerned parties or designated by the judge.

TITLE FOUR

ALEATORY CONTRACTS

CHAPTER ONE

BETTING AND GAMBLING

Article 1012
Betting is a contract by which a person is bound to pay a sum of money, or give something else, as agreed
upon, to the one who succeeds in attaining the aim targeted in the contract.

Article 1013
Betting is allowed in racing, shooting, sports or muscle building.

Article 1014
The validity of a betting contract is contingent upon the following:
a- The bet should be known and the one bound to pay it specified in person.
b- The object of the contract must be described in a manner excluding any excuse of ignorance; i.e. in
racing; the distance between the starting and ending points; and in shooting: the number of shots and the
acceptable target shot.

Article 1015
The bet may be payable in kind or a debt, immediately due or deferred as a whole, or partly due and partly
deferred.

Article 1016
If racing takes place with a bet, it is considered a contract binding the racers and none of them may
disengage except by mutual agreement.

Article 1017
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Where the betting is between two individuals or two groups, the bet may be paid by one of them or by a
third party, and each category is considered as one person I being bound by the outcome of the bet.

Article 1018
In case the contestants in a betting are more than two and it was intended to reserve to other than the
winner some of the outcome, the share payable to the next in rank in the race should be lesser than that
payable to the one preceding him.

Article 1019
It is acceptable that the outcome of the bet be payable by one of the contestants or by a third party to the
winner; but if the two contracting parties agree that the winner shall be entitled to a prize from the other
party, this is not allowed since the contract shall turn out into gambling.

Article 1020
If one of the contestant’s arrow meets an obstacle which deviates it from its target, or if his horse or camel
is hit on the face, or the whip conducting it is taken from the hands of its rider thus causing reduction in its
running speed, it shall not be considered in these instances outraced. If, however, the whip has been forgotten
by the rider before riding, or it fell from his hand while riding, thus causing reduction in its running speed, it
shall be considered outraced.

Article 1021
1- Any agreement relating to gambling, or prohibited betting, is void.
2- A person who loses in gambling or prohibited betting may, notwithstanding any agreement to the
contrary, reclaim what he has paid within six months from the time when he paid what he lost. He may prove
such payment by all means of claim.

CHAPTER TWO

LIFE ANNUITIES

Article 1022
1- A person may gratuitously bind himself to pay another person periodical payments during his lifetime.
2- In case this obligation is related to education, medical treatment or agreement, it must be honored in
accordance with customary practice unless otherwise specified in the obligation.
3- The validity of this obligation is contingent upon its being established in writing.

Article 1023
1- A life annuity may be granted for the lifetime of the obligee or any other person.
2- In the absence of an agreement to the contrary, the obligation, in the absolute, is considered made for the
lifetime of the obligor.

Article 1024
Should the obligor fail to meet his obligation, the other party may demand due performance of the contract.

Article 1025
If the annuity is settled for the lifetime of the obligor, who dies prior to the death of the obligee prior to the
date when the periodical payment becomes due, the oblige will be entitled to part of the annuity proportionate
to the period that expired until the death of the obligor, within the limits agreed upon, and, unless otherwise
agreed, he shall have a claim against the estate; the payment due being considered as a will.

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CHAPTER THREE

CONTRACT OF INSURANCE

SECTION ONE

GENERAL PROVISIONS

Article 1026
1- Insurance is a contract whereby both the insured and the insurer cooperate together to face the risks or
accidents insured against and, whereby in consideration of a specified amount or periodical premiums, the
insurer undertakes, upon occurrence of the event or the risk specified in the contract, to pay to the insured or
the beneficiary a sum of money, an annuity or any other pecuniary right.
2- The law regulates the insurance organization, namely as concerns their legal forms, method of
formation, means of performing their activities and supervision thereon, in order to achieve the cooperation
aims of insurance without prejudice to the mandatory provisions and fundamental principles of Islamic
Shari’a.
3- Until the enactment of the law referred to in the above clause, shall remain in force, the rules and
conditions actually observed concerning insurance and insurance organizations.

Article 1027
Without prejudice to the provisions of the preceding Article, insurance may cover risks occurring out of
personal accidents, workmen compensation for labor accidents, insurance against theft and breach of trust,
car and tort insurances and all other events which custom or law allows insurance against the risks resulting
therefrom.

Article 1028
The following conditions in a policy of insurance are void:
a- The condition providing for the forfeiture of the right to insurance on account of a breach of the laws,
unless such breach constitutes a deliberate felony or misdemeanor;
b- The condition providing for the forfeiture of the insured’s right due to his delay in notifying the
authorities that have to be notified, or in producing documents, if it appears that the delay was for an
acceptable excuse;
c- Any printed condition relating to cases involving nullity of the contract or forfeiture of the insured’s
right, which is not shown in a clear manner;
d- The arbitration condition included in the printed general conditions of the policy and not as a special
agreement distinct therefrom;
e- Any arbitrary condition, the breach thereof appears that it has no bearing on the occurrence of the event
insured against.

Article 1029
1- Exoneration of the insurer from his liability may be agreed upon, in case the beneficiary pays an
indemnity to the victim without the consent of the insurer.
2- The agreement referred to above may not be invoked if it is established that payment of the indemnity
was in favor of the insurer.

Article 1030
The insurer may be subrogated into the right of action which the insured may have against the author of the
damage involving the responsibility of the insurer, to the extent of the compensation he has paid, unless the
author of the unintended damage is an ascendant of the insured, one of his descendants, spouse or one of
those living with the insured under the same roof, or a person for whose acts the insured is responsible.

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Article 1031
Provisions, concerning the various insurance contract, which are not mentioned in the present law, shall be
governed by special laws.

SECTION TWO

EFFECTS OF THE CONTRACT

OBLIGATIONS OF THE INSURED -1

Article 1032
The insured is bound to:
a- Pay the agreed amounts on the term fixed in the contract;
b- Reveal at the time of conclusion of the contract, all information which the insurer consider of
importance to be known by him in order to assess the risks covered by him.
c-Inform the insurer of all matters, occurring during the contract period, which lead to the aggravation of
risks.

Article 1033
1- If the insured, in bad faith, conceals a matter or makes a false statement in such a manner as to lessen
the importance of the risk insured against, or leads to a change in its object, or if he fraudulently breaches his
promise to fulfill an obligation, the insurer is entitled to demand rescission of the contract and be paid all
premiums due prior to such demand.
2- In the absence of fraud or ill faith, the insurer, upon demanding rescission, has to refund to the insured
all premiums paid by him or the portion thereof for which he assumed no risk at all.
OBLIGATIONS OF THE INSURER -2

Article 1034
The insurer is bound to pay the insured amount or the sum due to the insured or the beneficiary, as agreed,
upon occurrence of the risk or maturity of the period fixed in the contract.

Article 1035
Insurance covering tort liability shall have no effect unless the victim files a claim against the beneficiary
after the occurrence of the event from which resulted such liability.

Article 1036
1- Actions arising out of insurance contracts shall be barred by limitation after the expiration of three years
from the date of the occurrence which gave rise to such action, or of the knowledge of the interested party of
its occurrence.
2- This period, however, shall only run, in the event of concealment by the insured of the information
relating to the risk insured against, or submission of incorrect statements, as from the date the insurer has
taken knowledge thereof.

SECTION THREE

PROVISIONS RELATING TO CERTAIN CLASSES OF INSURANCE

FIRE INSURANCE -1

Article 1037
In insurance against fire, the insurer is liable for the following:

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a- Damages resulting from fire even caused by earthquakes, thunderbolts, hurricanes, winds, cyclones,
domestic explosions, damages caused by airplane and other air vessels crashes or whatever is customarily
included in this class of insurance.
b- Damages which are the inevitable result of fire.
c- Damages to things covered by the insurance by reason of salvage measures or of measures to prevent the
extension of the fire.
d- Disappearance of the things covered by the insurance, occurring during the fire, unless it is established
that this was occasioned by theft.

Article 1038
The insurer is liable for damage resulting from the unintentional fault of the insured or the beneficiary.

Article 1039
Notwithstanding any agreement to the contrary, an insurer is not liable for damages caused deliberately or
fraudulently by the insured or the beneficiary.

Article 1040
The insurer is liable for damage caused by persons for whose acts The insured is responsible, whatever be
the nature of their fault.

Article 1041
The insurer is liable for the damages resulting from the fire even if the fire broke out owing to a defect in
the thing insured.

Article 1042
1- Whoever insures a thing or an interest with more than one insurer must notify each one of them of the
other insurance contracts, the value thereof and the names of the insurers.
2- In case there is more than one insurer, the insurance value must not exceed the value of the thing or
interest insured.

Article 1043
When a thing or interest is insured with more than one insurer for amounts exceeding in total the value of
the thing or interest insured; each insurer is bound to pay a part equivalent to the proportion between the
capital assured and the value of all the insurance contracts added together provided that the total sum paid to
the insured does not exceed the damage incurred by him as a result of the fire.

Article 1044
Fire insurance contracted on the chattels belonging to the insured in bulk and that were present, when the
fire broke out, at the places occupied by him, shall extend to the things belonging to the members of his
family and to those in his service, if they share the same living with him.

Article 1045
1- Should the thing insured be encumbered with a pledge, or with other real warranties, these rights will be
transferred to the compensation due to the insured by virtue of the contract of insurance.
2- If these rights have been registered and notified to the insurer, even by registered letter, the insurer may
not pay the amount due by him to the insured except with the consent of these creditors.
LIFE INSURANCE -2

Article 1046

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The insurer, in the case of life insurance, is bound to pay, to the insured or to the beneficiary, the sums
agreed upon the occurrence of the event insured against or on the maturity date stipulated in the contract,
without need to establish the damages sustained by the insured or the beneficiary.

Article 1047
The formation of the insurance contract on the life of a third party is conditioned by the written approval of
such third party, prior to the conclusion of the contract or, in case he lacks capacity, the contract shall only be
concluded if approved by his lawful representative.

Article 1048
1- The insurer is released from the obligation to pay the sum assured in case the insured commits suicide
and he shall refund to the beneficiary an amount equivalent to the value of the insurance reserve, unless the
beneficiary establishes that suicide was not meant to have the sum assured become due so, in this case, he
shall be entitled to the sum of the premiums paid less the expenses that should be deducted therefrom.
2- When suicide is due to an act beyond the control or awareness of the insured, or for any other reason
leading to a total absence of will, the insurer shall be bound to pay the entire sum assured agreed upon. The
beneficiary shall have to establish that the life assured was, at the time he committed suicide, out of control
of his actions.

Article 1049
1- The insurer is released from his obligations when the insurance is taken out on the life of a person other
than the insured and he deliberately causes the death of this person or if the death occurs at his instigation.
2- If, however, the beneficiary of the insurance is a person other than the insured who deliberately caused
the death of the insured, or if death occurs at his instigation, he shall be deprived of the sum assured. In the
case of an attempted homicide, the insured shall be entitled to substitute another person for the beneficiary.

Article 1050
1- The insured may provide that the sum assured be paid to persons specified in the contract or to be
nominated at a later date.
2- If the insurance is made for the benefit of the spouse of the insured, his sons, descendants or his heirs,
the sum assured shall be due to those who effectively have these qualifications at the death of the insured.
Should the heirs be the beneficiaries, the sum assured shall be divided upon them in accordance with their
legal shares in the estate.

Article 1051
An insured who has undertaken to pay periodical premiums may release himself from the contract at any
time provided he gives written notice to the insurer of his intention to do so. He shall be released from
payment of subsequent premiums.

Article 1052
1- Neither incorrect particulars nor misstatements as to the age of the insured shall render the insurance
contract void, unless the true age of the insured exceeds the limit specified in the table of rates.
2- If, as a result of incorrect particulars or misstatements, the premium agreed upon is less than the
premium that should have been paid, the sum assured shall be reduced in the proportion that the agreed
premium bears to the premiums which should be paid on the basis of the true age.
3- If, however, the agreed premium is higher than the premium which should have been paid on the basis
of the true age of the life insured, the insurer shall be bound to refund the excess received by him and to
reduce the subsequent premiums to the limit corresponding to the true age.

Article 1053
In life insurance, the insurer who has paid the sum assured shall not be entitled to be subrogated to the
rights of the insured or of the beneficiary against the person who caused the event assured against or against
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the person responsible therefore.

Article 1054
The amount of insurance payable to the insured or to the beneficiary, at the maturity of the period
stipulated in the contract, may not include any usurious interests.

Article 1055
Amounts agreed to be paid upon death of the insured shall not be included in his estate.

TITLE FIVE

PERSONAL GUARANTY CONTRACTS

CHAPTER ONE

SURETYSHIP

SECTION ONE

THE ELEMENTS OF SURETYSHIP

Article 1056
Suretyship is the joining of the financial assets of one person, the surety, to the financial assets of the
debtor in the fulfillment of his obligation.

Article 1057
1- Suretyship is formed by using this word or words of guaranty.
2- It shall be complete and executable by an offer made by the surety unless rejected by the guaranteed
debtor.

Article 1058
Suretyship is validly contracted if the surety has full capacity to donate.

Article 1059
Suretyship is void if contingent on an option to be made by the surety.

Article 1060
Suretyship may be of immediate execution or subject to a valid condition or to a suitable condition
precedent or entered into in respect of a future time or of a temporary nature.

Article 1061
The validity of a suretyship is conditioned upon its object being warranted by the principal as a known
debt, kind or person and being deliverable by the surety.

Article 1062
The suretyship may consist of the wife’s alimony or that of the parents even before it is adjudicated by the
court or conventionally agreed upon.

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Article 1063
Suretyship of the seller’s representative to the purchaser, to pay the price of what he was mandated to sell,
is not valid, so is the suretyship of the guardian in respect of what he sold of the minor’s property, as well as
the suretyship of the Nazir in respect of what he sold of the Wakf property.

Article 1064
1- The suretyship of a person on his death bed is not valid if his funds are covered with debts.
2- His suretyship is, however valid, if his debts do not cover his entire funds, in which case the provisions
governing wills shall apply.

Article 1065
Suretyship conditioned upon the discharge of the principal is a transfer; and the transfer subject to the non
release of the transferor is a suretyship.

Article 1066
The surety to a conditional suretyship or to a future debt may go back on his suretyship prior to the
entitlement of the debt.

Article 1067
Unless otherwise agreed, suretyship extends to the accessories of the debt and to the expenses of claiming
the debt.

SECTION TWO

CERTAIN KINDS OF SURETYSHIP

SURETYSHIP IN PERSON -1
)FACE’S GUARANTEE(

Article 1068
1- Suretyship in person binds the surety to assure the due appearance of the debtor at the time fixed upon
request of the creditor and if he fails to do so, the judge may condemn him to a daily fine for delay in
performance of an obligation, as he may release him from this fine if he establishes his inability to have him
appear.
2- If the surety binds himself to pay a specified amount as a penalty in case of failure of having the debtor
duly appear, he must pay this amount, but the judge may, if justified, fully or partially exempt him therefrom.

Article 1069
When the surety undertakes to pay the debt in case he fails to deliver the debtor, he is bound to fulfill his
obligation.

Article 1070
1- In suretyship in person, the surety is released from his obligation if he delivers the debtor to the creditor
or fulfills the obligation object of the suretyship.
2- The surety shall also be released by the death of the guaranteed debtor but not in case of death of the
person in whose favor the surety is given and, i8n this latter case, the heirs of this person are entitled to ask
the surety to have the debtor duly appear at the time fixed.

Article 1071

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The guaranteed debtor must be delivered at the place fixed by the surety and, in the absence thereof, at the
place of the contract.

Article 1072
If the surety satisfies the right due for the absence of the guaranteed debtor and the impossibility of having
him to duly appear, then it was established the death of this debtor prior to payment, he is entitled to recover
what he paid.

Article 1073
If it is not clear from the suretyship whether it is one whose object is pecuniary or in person, and there is no
presumption as to which is meant, it shall be construed as a pecuniary suretyship. If the surety alleges that it
meant a personal suretyship and the creditor alleges that it is a pecuniary one, the allegation of the surety,
after taking oath, shall prevail.

Article 1074
The husband may revoke the suretyship in person given by his wife without his authorization, even if the
guaranteed debt is less than one third of her funds.
SURETYSHIP AGAINST DISPOSSESSION -2

Article 1075
Suretyship against dispossession is a guaranty to refund the price of the thing sold in case of dispossession.

Article 1076
The surety of the seller, in case of dispossession, shall not be asked to fulfill his obligation until
dispossession is adjudicated and the seller is ordered to refund the price.

SECTION THREE

THE EFFECTS OF SURETYSHIP

BETWEEN THE SURETY AND THE CREDITOR -1

Article 1077
1- The surety has to fulfill his obligation upon maturity of the fixed delay.
2- If his obligation is subject to a condition precedent, fulfillment shall take place upon this condition is
materialized.

Article 1078
1- The creditor may have a claim against the principal and/or the surety.
2- If the surety has a guarantor, the creditor may have a claim against any of them at his choice.
3- His claim against any of them shall not forfeit his claim against the others.

Article 1079
The suretyship may be restricted to payment of the debt from the debtor’s funds deposited with the surety,
provided he obtains the assent of the debtor.

Article 1080
When the suretyship is absolute, the surety’s obligation shall follow that of the principal whether
immediately due or deferred.

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Article 1081
If the due debt has been has been guaranteed by one of the sureties through a deferred suretyship, the debt
shall be deferred as regards the surety and the principal together, unless the surety has conditioned the
deferred period to be added in his favor or the creditor has accepted deferment as regards the surety. In this
latter case the debt shall not be deferred as concerns the principal.

Article 1082
When the debt is secured by an encumbrance on an immovable property, prior to the suretyship, and the
surety demands that the debt be claimed first from the principal, execution on the funds of the surety may not
take place before execution on the property securing the debt.

Article 1083
The guarantor of a surety may ask the debtor to claim his debt first from the first surety.

Article 1084
If the surety or the debtor dies prior to the maturity of the deferred debt, the debt becomes due as concerns
the estate of the deceased.

Article 1085
When the same debt is secured by several sureties, any of them may be asked to pay the debt unless they
all secured the debt in the same contract without specifying that they act jointly and severally then each shall
be liable only for his share in the suretyship.

Article 1086
In case the sureties are jointly and severally liable and one of them settles the debt on its maturity, he may
call upon each of the other sureties to pay his share of the debt as well as a proportional part in the share of
the surety who is bankrupt.

Article 1087
Suretyship established by a law provision or a judicial order, when absolute, shall entail joint and several
liability between the sureties.

Article 1088
When the creditor has accepted a thing of another kind in payment of the debt, the principal and the surety
is discharged, unless this thing is dispossessed.

Article 1089
When a debtor becomes bankrupt, the creditor is bound to prove his debt in the bankruptcy, under penalty
of being deprived of his remedy against the surety to the extent of the loss suffered by the surety as a result of
the creditor’s failure to prove his debt.

Article 1090
1- The surety is not entitled to call upon the principal for any thing given on behalf of the latter by him,
unless the suretyship was given or accepted upon request of the principal and the surety has effectively given
it.
2- He is not entitled to call upon the principal to refund what he has paid from the deferred debt except
after maturity of the debt.

Article 1091

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1- A creditor is bound to hand over to the surety, at the time of the discharge of the debt, all documents that
are necessary to enable him to exercise his right of action against the debtor.
2- When the debt is secured by another real pledge or similar right on a movable, the creditor must
surrender such securities to the surety. When, however, the debt is secured by a charge on an immovable
property, the creditor must transfer his rights to the surety, provided the surety bears the expenses of such
transfer and call upon the debtor to refund the expenses paid by him.

Article 1092
When the debt matures, the creditor must claim it within six months from the maturity date otherwise the
surety shall be considered not concerned with the suretyship.
BETWEEN THE SURETY AND THE DEBTOR -2

Article 1093
1- When the surety has given in lieu of the debt something else, he shall have a right of action against the
debtor for what he secured and not for what he has given.
2- When, however, he compromised with the creditor on a portion of the debt, he shall have a right of
action for what he compromised and not the total debt.

Article 1094
1- When the principal discharges the debt before the surety, or if he is aware of any reason barring the
creditor from claiming his right, he must inform the surety of it. If he fails to do so, and the surety has
discharged the debt, he shall be at option either to call upon the principal or the creditor for reimbursement.
2- If the claim is filed against the surety, he must ask for the forced intervention of the principal, failing
which the principal may avail himself of all means to rebut the debtor’s claim.

Article 1095
The surety, pecuniary or personal, is entitled to ask the court to forbid the secured debtor from traveling
outside the country, if the suretyship was done at his request and there are proof that this will cause prejudice
to the surety.

Article 1096
The surety is entitled to call upon the debtor to reimburse him the expenses incurred in the implementation
of the suretyship contents.

Article 1097
If the debtors are jointly and separately liable, any of their sureties, requested by all of them, may have a
claim on any of them for the portion of the debt paid by him.

Article 1098
The surety may not take a consideration I exchange of his suretyship and, if he does, he must return it to its
owner. The suretyship shall be forfeited if he takes the consideration from the creditor, the debtor or a third
person with the knowledge of the creditor. If, however, he takes it without the knowledge of the creditor, he
shall be bound by the suretyship as well as by giving back the consideration.

SECTION FOUR

END OF THE SURETYSHIP

Article 1099
The suretyship comes to an end by any of the following events:

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a- Paying the debt.

b- Perishing of the property in the possession of the secured debtor, due to force majeure, prior to its
request.
c- Cancellation of the contract giving rise to the right which the secured debtor has to honor.
d- Discharging the surety from his suretyship or the debtor from his debt.
e- Death of the secured debtor.
f- Bringing the secured debtor at the place of delivery after expiration of the term fixed even if the
beneficiary of the suretyship refuses to take delivery, unless unduly prevented.
g- Bringing the secured debtor prior to the expiration of the term and there is no harm to the beneficiary of
the suretyship from taking delivery thereof.
h- If the secured debtor delivers himself voluntarily.

Article 1100
The surety for the price of sale is released from his suretyship if the sale is rescinded, or the thing sold is
dispossessed, or returned due to a defect therein.

Article 1101
If the surety or the secured debtor makes a compromise with the creditor on a portion of the debt, both
shall be discharged of the balance, but if the compromise states that the surety alone shall be discharged and
the creditor shall have a choice either to take from the surety the portion of the debt object of the compromise
and the balance from the principal or claim from the principal the whole debt.

Article 1102
Upon death of the beneficiary of the suretyship, the right devolves to his heirs.

Article 1103
If the creditor dies and his estate devolves exclusively to the debtor, the surety is released from the
suretyship and if he has, in addition, another heir, the surety shall only be released from the share of the
debtor in the estate.

Article 1104
The surety, in a temporary suretyship, shall only be bound to fulfill the obligations resulting during the
period of the suretyship.

Article 1105
1- If the surety or the debtor refers the creditor, for the entire secured debt or part of it, to another person by
virtue of a transfer of right accepted by the transferee or by this other person, both the principal and the
surety shall be discharged within the limits of this transfer.
2- If the discharge of the surety only is stipulated as a condition in the transfer, he will be discharged alone
to the exclusion of the principal.

CHAPTER TWO

TRANSFER

SECTION ONE

FORMATION OF A TRANSFER

Article 1106
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The transfer is an assignment of debt and of the claim from the transferor to the transferee.

Article 1107
The transfer is a binding contract, unless one of its parties has reserved for himself the option to revoke it.

Article 1108
1- Transfer may be restricted or absolute.
2- A restricted transfer is one that restricts, upon its execution, the debt which is due to the transferor from
the transferee, or the property which he holds in trust or in guaranty.
3- The absolute transfer is the one which has no restriction of this sort, even if existing.

Article 1109
1- The validity of a transfer is conditioned upon the acceptance of the transferor, the transferee and the
third party beneficiary.
2- The transfer is formed between the transferor and the transferee provided it is accepted by the concerned
creditor

Article 1110
The validity of the transfer is conditioned upon the transferor being indebted to the concerned creditor but
not upon the transferee being indebted to the transferor. If the transferee accepts the transfer, he shall be
liable to pay7 the debt to the concerned creditor.

Article 1111
The beneficiary in a mortmain may transfer his right, when due, to a third party and refer him to the person
in charge of the mortmain if the proceeds of the wakf were in his possession prior to the transfer.

Article 1112
The acceptance of the father or of the guardian of a transfer on a third party is possible, if it is beneficiary
to the minor, such is the case when the transferee is more solvent than the transferor, but not admitted if he is
near or equal to him in solvency.

Article 1113
In addition to the general conditions, the formation of a transfer is conditioned upon:
a- It must be executable and not subject to a condition precedent except if it is suitable or customarily
acceptable but not deferred to a future date.
b- Its execution should not be deferred to an unknown date.
c- It should not be limited to a specific period.
d- The thing transferred should be a known debt that can be substituted.
e- The object of the transfer to the transferee, in a restricted transfer, should be a debt or a property that
cannot be substituted and that the two objects be equal in kind, quantity and characteristics.
f- It must not comprise a conditional or anticipated emolument to one of the parties. The transfer shall not
be affected by an emolument added after its conclusion which shall not be due.

Article 1114
1- The transfer is null if it lacks one of its constitutive conditions and the debt goes back to the transferor.
2- If the transferee has paid to the creditor prior to the revealing of nullity, he may claim it back from either
the transferor or the creditor.

Article 1115
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The transfer is null if the cause of the debt, assigned to or transferred to, is void.

SECTION TWO

THE EFFECTS OF TRANSFER

BETWEEN THE CREDITOR AND THE TRANSFEREE -1

Article 1116
When the transfer is validly formed, the creditor is entitled to claim the debt from the transferee; the
transferor shall be released from the debt and the claim as well.

Article 1117
The debt shall be transferred to the transferee with the same characteristics as on the transferor; if it is due
immediately, the transfer shall be so and if deferred, the transfer shall be deferred.

Article 1118
The creditor and the transferee may, after the formation of the transfer, agree on part of the debt or less,
defer payment of the due debt, pay the deferred amount before term, or take something in exchange of the
debt unless this constitutes usury for late payment.

Article 1119
The debt transferred shall maintain its securities despite the change in the person of the debtor. The surety,
personal or pecuniary, however, shall not be bound towards the creditor unless he accepts the transfer.

Article 1120
The transferee may, towards the creditor, avail himself of all incidental pleas of defense relating to the
debt, which he had towards the transferor as he may exercise the pleas which the transferor has towards the
creditor.
BETWEEN THE TRANSFEROR AND THE TRANSFEREE -2

Article 1121
The transferor may claim from the transferee the debt or the property owed by him to the former, if the
transfer is not restricted to any of these and has fulfilled all its conditions. The transferee is not entitled to
retain either of these until payment is made to the creditor.

Article 1122
The right of the transferor to claim from the transferee the debt or property held by him shall be forfeited if
the transfer is restricted and have satisfied its conditions. The transferor, however, shall not be discharged
towards the creditor if he settles any of these to the transferor.

Article 1123
In a valid transfer, of both kinds, the transferee may not abstain from settlement to the creditor even if the
transferor has received from the transferee his debt or recovered the property that was with him.

Article 1124
1- If the absolute transfer has been completed with the consent of the transferor, a set-off shall take place
the debt that the transferee owes him and the amount paid in execution of the transfer.
2- In case he has no debt owed to him by the transferee, he shall have a claim against him after execution
of the transfer.

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BETWEEN THE CREDITOR AND THE TRANSFEROR-3

Article 1125
The transferor has to deliver to the creditor the instrument establishing the right transferred as well as all
information and means enabling him to exercise this right.

Article 1126
Unless otherwise agreed, if the transferor warrants to the creditor the solvability of the transferee, this
warrant applies only to his solvability at the time of the transfer.

Article 1127
1-In case the transferor dies before collecting the debt of the restricted debt, the creditor shall be allotted
the funds pertaining to the transferee or in his possession during the lifetime of the transferor
2-The due date of the debt shall remain as it is in the transfer, of both kinds, in case of death of the
transferor, and the debt shall become due upon the death of the transferee.

Article 1128
1-The restricted transfer shall be void if the debt is forfeited or the property is dispossessed due to a matter
preceding the transfer. In this case, the creditor shall have a claim to recover his right from the transferor.
2-The restricted transfer shall not, however, be void if the debt is forfeited or the property dispossessed due
to a reason that accrued subsequent to the transfer and the transferee shall, after settlement, claim back from
the transferor what has paid.

Article 1129
The creditor shall have a right of recourse against the transferor in the following instances:
a- If the transfer is rescinded by mutual assent of the parties thereto.
b-If the transferee denies the transfer and there is no proof of its existence and the transferee took an oath
in denial thereof.
c- If the property assigned by a restricted transfer perishes and it was not warranted.
BETWEEN THE CREDITOR AND THIRD PARTIES-4

Article 1130
1-Where there are several transfers of the same right, the one that is first opposable to third parties shall
prevail.
2-The assignment is not opposable to third parties except by a formal notification to the transferee or his
acceptance thereof by virtue of a document bearing a certified date.

Article 1131
1-If an attachment is laid down between the hands of the transferee prior to the time the transfer becoming
opposable to third parties, the transfer is considered, as regards the author of the attachment, as another
attachment.
2-In this case, if an attachment is laid down after the transfer became opposable to third parties, the debt
shall be divided between the author of the first attachment, the creditor and the author of the second
attachment, in equal parts, provided it is taken from the share of the second seizer a sufficient amount to
enable the creditor completing the amount of the transfer.

SECTION THREE

END OF THE TRANSFER

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Article 1132
The transfer ends by settling its object to the creditor effectively or de jure.

BOOK THREE

THE PRINCIPAL REAL RIGHTS

CHAPTER ONE

THE RIGHT OF OWNERSHIP

SECTION ONE

LIMITS AND PROTECTIVE MEASURES

Article 1133
1-Ownership right is the power given to the owner to freely dispose, use and enjoy of his property.
2-The owner of a thing has alone, the right to enjoy the property owned, its yields, fruits and products and
to dispose of the property by all acts of disposition allowed by law.

Article 1134
1-The owner of a thing owns everything that constitutes an essential element of it which cannot be
separated therefrom without having the thing perish, deteriorate or change.
2-Unless otherwise stipulated by law or provided in the agreement, the ownership of land includes that
which is above and below, as far as it can be usefully enjoyed in height and depth.

Article 1135
1-No one can be deprived of his property without lawful reason.
2-Expropriation for public utility may take place against a far compensation and in
accordance with the law provisions.

SECTION TWO

RESTRICTIONS ON THE RIGHT OF OWNERSHIP

GENERAL PROVISIONS-1

Article 1136
An owner has the right to dispose freely of his property, unless his act is excessively detrimental to others
or constitutes a violation to the law or to the regulations concerning public or private interest.

Article 1137
Excessive detriment may cause weakness of construction, its demolition or deprivation of the essential
necessities, that is the utilities intended from construction

Article 1138
When third parties interests are tied up with the property, the owner may not dispose of it in a manner
detrimental to the right owner without his consent.

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RESTRICTIONS AS TO NEIGHBORHOOD-2

Article 1139
Obstructing light from the neighbor is considered excessive detriment, so no one is allowed to erect a
construction blocking the windows of his neighbor’s dwelling in such a manner as to obstruct light from him,
otherwise the neighbor may ask the removal of such construction in driving away any prejudice he may
sustain.

Article 1140
If someone has a property of which he lawfully dispose and another person erects in the neighborhood a
construction which has been prejudiced by the old situation, the owner of the recent construction may not
allege prejudice and he has to drive away from him any damage that he may sustain.

Article 1141
1- The owner or the person benefiting from the use of the airspace over the property through which have
spread the tree branches of another person, has the right to claim the removal of what has trespassed his
airspace even if no damage occurred to him. Should he abstain, he is liable compensate what has perished
because of him. The prejudiced party is moreover entitled, without need to a court order and without liability
on his part, to remove what has spread over his property even by cut-off, if this is the only way to eliminate
the damage.
2- The same remedy shall apply to the tree roots which have spread within the land of others.

Article 1142
The owner of the building is entitled to ask the prevention of his neighbor from planting trees in the
vicinity of his building, if such trees are of a kind that has roots that may spread and, if planted, he has the
right to ask for its plucking.

Article 1143
1- A neighbor may neither compel his neighbor to erect a wall or similar partition on the boundaries of his
property nor to desist himself from part of the wall or of the land on which it is erected.
2- The owner of the wall is not entitled to demolish it without strong excuse, if this is prejudicial to his
neighbor whose property is sheltered behind this wall.

Article 1144
1- The owner must not exercise his right in an excessive manner to the extent detrimental to his neighbor’s
property.
2- The neighbor has no right of action against his neighbor for the usual unavoidable inconvenience, but he
may claim the suppression of these inconveniences if they exceed the usual limits, taking into consideration
in this respect custom, the nature of the immovable properties, their respective locations and the use for
which they are intended. The license issued by the competent authorities is not a bar to the exercise of such a
right of action.
Restricting the Rights of the Person in Favor of whom -3
the Act of Disposition has been taken

Article 1145
The owner may not provide in his act of disposition, whether a contract or a will, conditions restricting the
rights of the person in favor of whom it has been taken, unless these conditions are licit and are intended to
protect a lawful interest of the disposer, the disposed to or a third party for a limited period.

Article 1146

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Every condition preventing the party disposed to from disposing shall be void unless it fulfills the
provisions of the preceding article.
Right of Way -4

Article 1147
A private road is like a co-ownership to those who have the right of passage on it. None of the right owners
may do anything thereon without authorization of the other co-owners.

Article 1148
1- Passers-bye on a public road, when have the right of passing through a private road.
2- The owners of the private road may not agree to sell or partition it or close its point of ingress.

Article 1149
None other than the co-owners of a private road may open a door on it or have passage on it.

Article 1150
If one of the co-owners of a private road blocks a door opened on it, he shall not forfeit his right of way
and he, or his predecessor, may reopen it.

Article 1151
Costs of the private road construction nave to be borne by each of the co-owners in proportion to the
benefit accrued to each.

SECTION THREE

JOINT OWNERSHIP
GENERAL PROVISIONS -1

Article 1152
Without prejudice to the provisions concerning inheritance shares of each heir, when two or more persons
are owners of the same thing, through any of the reasons of acquisition of property, but their respective shares
in it are not allotted distinctively, they are joint owners and, in the absence of a proof to the contrary, they
shall have equal shares in the joint property.

Article 1153
1- Each of the co-owners in the property shall be entitled to alienate freely of his share without obtaining
the permission of the other co-owners provided he does not cause prejudice to the rights of all other co-
owners.
2- When the alienation is focused exclusively on a separate part of the joint property and, upon partition,
this part is not allotted to the disposer; the right of the acquirer of the alienated part is transferred, as of the
date of alienation, to the part accruing to the disposer as a result of the partition. If the acquirer did not know
that the disposer did not own the property alienated separately at the time of the contract, he shall have, as
well, the right to annul the alienation.

Article 1154
In the two cases of commingling and confusion, a co-owner in common may not alienate his share without
the authorization of the other co-owner.

Article 1155

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1- In the absence of an agreement to the contrary, the management of a property held in common belongs
jointly to all the owners in common.
2- When one of the co-owners assumes the management without objection from the other co-owners, he
shall be considered acting as a proxy to them.

Article 1156
1- A decision taken by the majority of co-owners as to ordinary acts of management is binding on all of
them. The majority shall be calculated on the basis of the value of their shares.
2- Failing a majority, the co-owners may appoint a manager and establish, for the management and
enjoyment of the property, rules applicable on all the co-owners, their successors, general or special;
otherwise one of the joint co-owners may apply to the court to take the necessary measures for the
preservation of the property and appoint a manager thereof.

Article 1157
1- Co-owners who possess at least three quarters of the property held in common may decide, in order to
obtain a better enjoyment of the property, to make essential modifications or changes, in the purpose for
which the property was intended, which exceed the normal scope of management, provided that these
decisions are officially notified to the other co-owners. Dissenting co-owners are entitled to refer the matter
to the judge within two months from the date of notification.
2- The judge before whom the matter was referred, if he approves the decision taken by the majority, take
whatever decision he deems appropriate as to the measures to be taken. He may, in particular, order that
security be given to the dissenting co-owner so as to guarantee any compensation that may become due to
him.

Article 1158
Every co-owner in common is entitled, even without the consent of the other co-owners, take measures
necessary for the preservation of the property in common.

Article 1159
The costs of managing the joint co-ownership and its preservation, as well as taxes imposed on it and all
other charges resulting from common property or encumbering the property shall be borne by all co-owners,
each in proportion of his share.
CESSATION OF JOINT OWNERSHIP -2

Article 1160
Partition is the division, by consent or by order of the judge, of the common property and specifying the
share that was held in common.

Article 1161
The allotted part in property must be divisible and owned by the co-owners when operating the partition.

Article 1162
Without prejudice to the provisions of the other laws, whoever wishes to end the status of common
property and was not, in this respect, in agreement with the other co-owners, is entitled to apply for a judicial
partition.

Article 1163
The validity of a partition by agreement requires the consent of every partitioner.

Article 1164

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1- The validity of a judicial partition requires that it be requested by one of the co-owners.
2- The judicial partition shall take place even if one of the co-owners disagrees.

Article 1165
The property held in common must be divisible in such a manner as not to depart from the benefit aimed at
by the partition.

Article 1166
The provisions of Article 1166 have been replaced by virtue of Article 1 of Federal Decree-
Law No. 30 dated 27/09/2020, to read as follows:
When a property cannot be divided in kind or when such partition involves a damage or a serious
diminution in the value of the property to be partitioned, every co-owner shall be entitled to sell his share to
another co-owner or request the judge to sell it in the manner set out in the law.
If the share cannot be sold, this partner may request the sale of the whole property in the manner set forth
in the law, and the price shall be distributed to the partners, each in proportion to his share. The judge may
order to limit the auction to the partners first if one of them so requests.
In all cases, the sale request shall not be accepted if it results in greater harm to the rest of the partners, and
a new sale request may not be submitted by the same person before the lapse of one year from the date of
dismissal of the preceding request or the date of repair of the damage, whichever is earlier.

Article 1167
1- The personal creditors of any co-owner may oppose the partition, whether reached by agreement or
judicially, through a notification served on all co-owners, if partition is conventional, or an intervention in the
proceedings, if judicial.
2- The partition shall be without effect as regards the creditors if the co-owners do not have them intervene
in all stages of the proceedings.
3- If the partition has already taken place, the creditor who has not intervened cannot attack it unless there
has been fraud.

Article 1168
When a debt on the decedent shows up after the partition of the estate, the partition is cancelled unless the
debt is paid by the heirs or they have been discharged by the creditors or there is a property other than the
divided one of which the debt can be paid.

Article 1169
The co-owner, party to the partition, is the sole independent owner of his share allotted to him after the
partition.

Article 1170
The partition may not be revoked after its completion. All the partners may, however, rescind and terminate
the partition by agreement between them and restore the divided property in its common status as it was.

Article 1171
Partitioning things of different species and those in kind of the same species shall be subject to the
provisions applicable to acceptance on condition, after sight examination and option of rescission on grounds
of defect. As to partition of fungibles, they shall be subject to the option of rescission on grounds of defect to
the exclusion of the two other provisions concerning acceptance on condition and after sight examination.

Article 1172
1- Whoever, in a partition by consent, has fallen under serious inequity, may request from the judge the
rescission of the partition and order a new partition on equitable basis.
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2- Inequity shall be evaluated on basis of the value of the partitioned property at time of partition.

Article 1173
The action for rescission and re-partitioning shall not be heard if it is not instituted within the year
following the partition.

Article 1174
The partition is void if the property partitioned dispossessed as a whole or only a part of it held in common
and, in this latter case a new partition shall take place for the remaining part of it.

Article 1175
The partition of a non authorized agent is contingent upon the approval, by words or by act, of the co-
owners of the partitioned property held in common.
PARTITION OF USUFRUCT -3

Article 1176
Partition of usufruct is the sharing of enjoyment which may be temporal or spatial. In the former, the co-
owners of the common property successively enjoy the whole common property for a period proportionate to
the share of each one of them; in the latter, each of the joint owners enjoy a specific part of the common
property.

Article 1177
1- In temporal sharing of usufruct, the period of time must be specified, while this is not required in spatial
enjoyment of common property.
2- The co-owners shall agree on the period of time of sharing the usufruct, otherwise the court shall fix the
period considered by it as adequate, taking into consideration the nature of the dispute and of the common
property, and shall draw lots to specify the start of the temporal sharing of usufruct and determine the place in
the spatial enjoyment of common property.

Article 1178
As concerns the opposability towards third parties, the capacity of the co-owners, their rights and
obligations and the means of proof, the sharing of usufruct shall be subject to the provisions of the lease
contract, if not in contradiction with the nature of this partition.

Article 1179
1- The co-owners shall agree, during the process of the final partition to share the enjoyment of the
common property between them until the completion of such partition.
2- If the co-owners do not reach an agreement as to sharing the enjoyment of the common property, the
judge may, upon request of one of the co-owners, order it and he may, in this respect, seek the assistance of
experts if need be.

Article 1180
1- If one of the co-owners of the divisible common property asks the partition and the other co-owner asks
sharing the enjoyment thereof, t6he action in partition shall be admitted.
2- If one of them asks sharing the usufruct, while none has asked the partition, and the other one refrains,
he shall be compelled to accept sharing the usufruct.
3- If one of the co-owners asks for sharing the usufruct of a common property that is not divisible and the
other abstains, he shall be compelled to accept sharing the usufruct.

Article 1181
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Sharing the usufruct shall not be void by the death of one or all of the co-owners and the heirs of the
deceased shall replace him.
COMPULSORY JOINT OWNERSHIP -4

Article 1182
With due compliance with the provisions of articles 1165 and 1166 of the present law, co-owners in a
commonly held property are not entitled to ask for its partition if it is revealed from the purpose for which it
was affected that the property must always remain held in common.
FAMILY JOINT OWNERSHIP -5

Article 1183
The members of the same family who have a common occupation or interest may agree in writing to
establish a family joint ownership. This joint ownership consists either of an inheritance which the members
of the family agree to leave wholly or partly in joint ownership or of any other property belonging to them
which they agree to place in such joint property.

Article 1184
1- A family joint ownership may be established by agreement for a period not exceeding fifteen years.
Each one of the co-owners may, however, if there are serious grounds to do so, apply to the court for
authority to withdraw his share of the joint property before the end of the agreed term.
2- When no period is fixed for such ownership, each one of the co-owners may withdraw his share after six
months from the day he gives notice to this effect to the other co-owners.

Article 1185
1- Co-owners cannot demand partition so long as the family joint ownership continues and no co-owner
can dispose of his share in favor of a person who is not a member of the family without the consent of all co-
owners.
2- If a person who is not member of the family acquires, as a result of a voluntary or forced alienation, the
share of one of the co-owners, he only becomes a partner in the family joint co-ownership if he and the other
co-owners consent thereto.

Article 1186
1- Co-owners who own the majority in value of the shares may appoint amongst themselves one or more
managers to administer the common property. Subject to any agreement to the contrary, the manager may
introduce such changes in the intended use of the property held in common as may ensure a better enjoyment
of the property.
2- A manager may be discharged in the same manner as he was appointed,. The court may also, upon the
request of any owner, discharge him if there is a serious cause justifying such discharge.

Article 1187
Subject to the preceding provisions, family joint ownership will be governed by the law provisions relating
to common property, mandate and estates.
OWNERSHIP OF STOREYS IN BUILDINGS -6

Article 1188
1- When the different storeys or various apartments of a building belong to different owners, such owners
are considered co-owners of the ground and of the parts of the building intended for the common use of all,
or any part registered under this description, or if the nature of the building require that it be of common use;
especially comprising the following:
a- The foundations, the main walls.
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b- Common separating walls and walls affected to entrances and to support the ceilings.
c- Ventilation canals for utilities.
d- Floor supports, vaults, entrances, yards, roofs, stairs and staircases, passages, corridors, floor supports,
lifts and concierge rooms.
e- Heating and cooling apparatuses, all kind of pipes, gutters, drains, common installations and extensions
such as lighting and water supplies and their supplements and all that are considered ancillaries to the
building with the exception of those that are inside the storeys or the apartments.
2- All the above, in the absence of any provisions to the contrary in the title deeds or private law.

Article 1189
Common parts in the building, as stipulated in the preceding article, cannot be divided; the share of each
owner shall be proportionate to his share in the building. No owner can dispose of his share in the parts held
in common independently of his share in the building.

Article 1190
The inner walls which separate two apartments belong in common property to the owners of these two
apartments if not considered among the common parts.

Article 1191
Every owner may utilize the parts held in common, in accordance with the use they are intended, provided
he does not prevent the other owners exercising their rights.

Article 1192
Every owner must participate in the cost of the preservation, maintenance, management and reconstruction
of the parts held in common. Unless otherwise provided in the building management statutes, the share of
every owner in these costs will be calculated in proportion to the value of his share in the building. Every
owner causing an increase in the costs of the building shall be responsible to cover such increase.
No owner can renounce his share in the parts held I common with a view to avoiding participation in such
costs.

Article 1193
No modification can be made to the parts held in common, even in the event of reconstruction, without the
consent of all the owners, unless such modification made by one of the owners, is to the benefit of such parts
without changing their allotment or sustaining prejudice to the other owners.

Article 1194
1- The owner of a lower storey is bound to execute works and repairs necessary to prevent higher storey
from falling.
2- If he refuses to execute the necessary repairs, the judge may, upon request of the prejudiced party, may
order the execution of the necessary repairs and the prejudiced party is entitled to claim from the owner of
the lower storey the costs sustained by him.

Article 1195
1- If the building falls down, the owner of the lower storey is bound to rebuild his storey as it was, failing
which, and in case the owner of the higher storey rebuilds it, with his consent or with permission of the
judge, he may claim from the owner of the lower storey his share in these costs paid by him.
2- If the owner of the lower storey refuses to rebuild and this was done by the owner of the upper storey
without the judge’s authorization or the consent of the owner of the lower storey, he may only claim from the
latter his share in the building at the time of reconstruction.
3- If the owner of the upper storey rebuilds the lower storey without referring to its owner and establishing
his refusal, the former shall be considered as donating these costs and he has no claim whatsoever against the
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latter.
4- In the two first instances, the owner of the upper storey may prevent the owner of the lower storey from
disposing and making use of his storey until he has repaid the amount due to the former. He may also let it,
with the judge’s authorization and recover his right from the rent.

Article 1196
The owner of the upper storey may not heighten the building in such a way as to injure the owner of the
lower storey.
UNION OF OWNERS OF STOREYS AND APARTMENTS -7

Article 1197
1- Whenever there is a joint property of a building divided into storeys or apartments, the owners thereof
may constitute between themselves a Union to manage it and ensure proper use.
2- The objective of constituting such Union may also be the construction or the acquisition of buildings
with a view to allocating the ownership of parts of such buildings to members of the Union.
3- In its formation, statutes, management and powers and all other matters of its concern, the Union shall
be subject to the relative law provisions.
PARTY WALL -8

Article 1198
Any of the partners in a party wall may not heighten the wall by increasing construction on it without
authorization of the other partners.

Article 1199
1- If a partner in a party wall has a serious interest in heightening it, he may do so on his own expenses
provided he does not cause a serious prejudice to his partner. He is responsible of its maintenance and of
making it fit to support the burden of its heightening without affecting its ability thereto.
2- If the party wall is not fit to support the heightening, the co-owner who desires to heighten the wall must
reconstruct it entirely at his own cost, in such a way as the thickening shall, as far as possible, abut on his
side. The reconstructed wall remains, apart from the heighten parts, a party wall, but the neighbor who has re-
heightened the wall cannot claim any compensation.

Article 1200
A neighbor who has not contributed to the expenses of heightening may become a co-owner of the
heightened part if he pays half the cost thereof and the value of half of the ground covered by the increased
thickness, if any.

Article 1201
1- An owner of a party wall is entitled to make use of it for the purpose for which it is normally intended
and to put on it to support the roof without making it support too great a weight for its strength.
2- When a party wall becomes unfit for the purpose for which it is normally intended, the cost of repairs or
reconstruction will be borne by the co-owners in proportion to their respective shares in it.

Article 1202
In the absence of proof to the contrary, a wall which at the time of its construction separated two buildings
is deemed to be a party wall up to the point at which it ceases to be a common wall to the two buildings.

CHAPTER TWO

REASONS OF ACQUISITION OF PROPERTY

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SECTION ONE

APPROPRIATION OF A PROPERTY WITHOUT AN OWNER

MOVABLES -1

Article 1203
Whoever takes possession of a movable which has no owner, with the intention of its appropriation,
acquires the ownership thereof.

Article 1204
1- A movable is deemed to have no owner when its owner abandons possession of it with the intention of
renouncing his ownership thereto.
2- Animals, other than domestic animals, are deemed to have no owner so long as they are at liberty.
Tamed animals which were accustomed to return to their specified place and then have lost this habit,
become without an owner.

Article 1205
1- Treasures found in a land owned by a specific person are deemed to be his ownership but he has to pay
one fifth to the State.
2- Treasures explored in a land owned by the State are fully owned by such State.
3- If, however the land is duly in mortmain, whatever explored therein belongs to the Wakf.

Article 1206
Minerals found buried in a land is State ownership even if found in a land that has an owner.

Article 1207
Matters concerning, treasures, minerals as well as the right of fishing, the right to things found and to
antiquities are governed by special laws.

Article 1208
Whatever thing of pecuniary value thrown by the sea and its property has not been claimed by anyone is
the property of the founder who first has taken possession thereof. If ownership is claimed by a non Moslem
or a non Dhimmi, one fifth of it goes to the State Treasury and the balance to the founder. If it was preceded
by a claim in ownership by a Moslem or Dhimmi, it is for its owner, if he has knowledge thereof, otherwise it
shall be deemed an abandoned thing.
IMMOVABLE PROPERTY -2

Article 1209
1- Uncultivated land which has no owner is the property of the State.
2- The appropriation or the possession of uncultivated land can only be effected with the authorization of
the State in accordance with the laws in force.

Article 1210
An uncultivated land is a land with no affectation neither by ownership or use. Affectation takes place by
developing the land, by its becoming within the inviolable domain of a State, a well, a tree or a dwelling.

Article 1211
1- Whoever develops or constructs an uncultivated land with authorization of the State, becomes the
proprietor thereof.
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2- The competent authority may authorize the development of an uncultivated land by using it for his
benefit without appropriating it.

Article 1212
When a person develops part of a land by authority of the State and leaves the other part, he becomes
owner of the developed part to the exclusion of the other part unless the uncultivated part falls in the middle
of the developed lands.

Article 1213
The development of an uncultivated land takes place by erecting a construction on it, planting trees,
drilling water from it or the like and it becomes the property of the one who developed it. If it is abandoned
for a long period of time and developed by another person it will become, by its development, the property of
this other person. This land will also become the property of the latter, even before the lapse of a long time
after its abandonment by the former, if the first developer keeps silent without justification after his
knowledge thereof. If, however he does not keep silent or if his silence is excused, it will remain his property
bur the second developer will be entitled to the gross value of what he developed, in the first instance, and the
reduced value, in the second instance.

Article 1214
The inviolable domain of a State is its points of ingression and egression, its wood cutting area and its
pastures. The inviolable parts of a dwelling are the easements enjoyed by its inhabitants during their living
therein. Easements of dwellings gathered in one domain may be enjoyed by the inhabitants of each dwelling
in as much as no prejudice is sustained by their neighbors. The inviolable well is its output sufficient for
drinking and irrigation and that prejudice will be sustained if any thing affects its output or water. The
inviolable space of a tree is all what it needs for its irrigation, the extension of its roots and branches and that
prejudice will be sustained if anything adversely affects its growth. The inviolable space is reserved for the
inhabitants of the State or dwelling, or the owner of a well or tree and they may prevent others from enjoying
it or do anything in such domain.

Article 1215
1-Whoever acquires a land through purchasing or is bestowed it by inheritance or donation from the
developer, then it was abandoned, it shall not cease to be his property by its abandonment regardless of the
period of abandoning it.
2- If it is developed by another person, he shall not acquire its ownership through developing it except by a
possession having duly fulfilled its conditions.

Article 1216
1- Walling an uncultivated land is not considered as developing it.
2- Whoever walls a land he shall have preference over all others for a period of three years. If, however, he
does not develop it within this period of time, the land may be given to another person provided he develops
it.

Article 1217
Whoever drills a well in an uncultivated land, by authorization of the competent authority, it becomes his
property.

SECTION TWO

AMODIATION

Article 1218
The yields of an exploited land are the ownership of the exploiter and it is conditioned upon the possibility
of being initially appropriated.
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SECTION THREE

INHERITANCE AND LIQUIDATION OF THE ESTATE

GENERAL PROVISIONS -1

Article 1219
1- The heir shall acquire by inheritance the immovable and movable properties as well as the rights
included in the estate.
2- The designation of the heirs, their shares in the succession and the devolution of the estate is governed
by the precepts of the Islamic Shari’a and the laws issue in application thereof.
THE ESTATE -2
A- GENERAL PROVISIONS

Article 1220
1- In the absence of the appointment, by the decedent,of an executory custodian to his estate, the court
may, at the request of one of the concerned parties, appoint as administrator of the estate a person chosen
unanimously by the heirs, failing such unanimity the judge shall, after having heard the heirs, choose such
administrator.
2- If among the heirs there is a fetus in gestation, an incapacitated person or lacking capacity or an absent,
the provisions of the special laws should be observed.

Article 1221
The appointment of an administrator by the deceased must be confirmed by the judge, if so requested by
one of the concerned parties.

Article 1222
1- The appointed administrator of the estate may resign his duties in accordance with the provisions
governing mandate.
2- The judge, upon request of a concerned party or the public prosecution, or even without request at all,
may, whenever justified, discharge the administrator and appoint another one.

Article 1223
1- The Court shall enter, in an ad hoc register, the orders appointing administrators of the estate, confirm
their appointment if made by the decedent, their discharge or their renunciation.
2- Such entry shall produce its effect on those dealing with third parties, as concerns the immovable
properties belonging to the estate.

Article 1224
1- The administrator of the estate shall, pursuant to his appointment, take possession of the property of the
estate and proceed with their liquidation under the control of the judge. He may ask for remuneration to be
appreciated by the judge.
2- The estate shall bear the costs of the liquidation and these costs shall have a privilege in the same
preferential rank as legal expenses.

Article 1225
The judge must, when necessary, take all necessary measures for the preservation of the estate. He may, in
particular order that the cash money, securities and articles of value, be deposited with the Treasury of the
court, in which jurisdiction all or most of the estate property is situated, until completion of the liquidation
process.

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Article 1226
The administrator of the estate has to pay out of the assets of the estate:
a- Burial and funeral expenses.
b- Sufficient alimony, up to an acceptable limit to be paid, out of these assets, to the needy heir until
liquidation of the estate after obtaining a court order to pay it and to deduct this alimony from the share in the
estate of each heir to whom such alimony is paid.
c-Any dispute arising as regards such allowance shall be settled by the judge.

Article 1227
1- As from the date of appointing an administrator of the estate, the creditors may only take proceedings, or
continue those already commenced in connection with the estate, against the administrator.
2- All proceedings taken against the decedent must, at the request of any interested party, be suspended
until settlement of all debts on the estate.

Article 1228
No heir may, before receiving an inheritance certificate showing his share in the net estate, dispose of
estate assets, recover estate debts, or set off a personal debt against a debt of the estate.

Article 1229
1- The administrator of the estate is bound to take the necessary measures to preserve its assets, perform all
necessary acts of administration, represent the estate in the actions brought before the court and recover the
debts due to the estate.
2- The administrator of the estate, even if not remunerated, is responsible to the same extent as a paid
proxy. The Court may call on him to render an account of his administration at fixed intervals.

Article 1230
1- The administrator of the estate must address to its creditors and debtors a notice calling upon them to
submit a statement of all their claims and debts, within a delay of two months from the publication of such
notice.
2- The notice must be posted on the notice board of the court within which jurisdiction the decedent was
last domiciled and the court within the jurisdiction of which all or most of the estate assets are situated. This
notice must also be published in a daily newspaper.

Article 1231
1- The administrator of the estate must, within three months from the date of his appointment, file with the
Court, which appointed him, an inventory statement of the assets and liabilities of the estate with an
assessment of their value. He must also inform, by registered letter, all concerned of this filing.
2- He may apply to the judge for an extension of time, if this extension is justified.

Article 1232
The administrator of the estate may, for the purpose of assessment of the value of the estate’s assets and the
preparation of their inventory, seek the assistance of an expert. He must also record all pertinent information
disclosed by the papers of the deceased and those coming to his knowledge. The heirs must advise the
administrator of all debts and claims of the estate known to them.

Article 1233
Any person, including an heir, who fraudulently appropriates a part of the assets of the estate, is liable to
the penalty provided for in the Penal Code for misappropriation.

Article 1234

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Any dispute as to the accuracy of the inventory should be filed with the competent court, within thirty days
from the date of depositing the inventory statement.
B- SETTLEMENT OF THE DEBTS OF THE ESTATE

Article 1235
a- Upon the expiration of the delay fixed for the submission of disputes arising out of the inventory, the
administrator of the estate will proceed, upon the authorization of the Court, with the payment of the
uncontested debts of the estate.
b- Debts which are contested will be settled after the final decision of the court on their veracity.

Article 1236
In the event of the estate being insolvent, or of the possibility of it being so, the administrator must suspend
the settlement of any debt, even if uncontested, pending final decisions in respect of all disputes concerning
the estate.

Article 1237
1- The administrator will discharge the debts of the estate with funds derived from claims recovered, cash
in hand, proceeds of the sale of movables belonging to the estate and, if insufficient, from the sale price of
real estates.
2- The sale of movable and immovable property of an estate will be made by public auction in the manner
and subject to the delays laid down for forced sales in the Law on Procedures before the civil courts , unless
all the heirs agree on another manner. If the estate is insolvent the approval of all the creditors, to the manner
agreed upon between the heirs, is necessary. The heirs are always entitled to take part in the auction.

Article 1238
The Court may, at the request of all heirs, pronounce that the debt covered by a real security has become
immediately due for payment, and fix the amount payable to the creditor.

Article 1239
Any heir may, after distribution of the deferred debts that are covered by a real security, pay the amount
allocated to him before the due date.

Article 1240
Creditors of the estate, whose debts have not been paid because they were not shown in the inventory and
were not covered by a real security on the property of the estate, have no remedy against whoever acquired in
good faith a real right on this property, but have a claim against the heirs to the extent to which they have
benefited from the estate.

Article 1241
The administrator of the estate shall, after discharge of its debts, proceed with the payment of legacies and
other charges.
C- DELIVERY AND PARTITION OF THE ESTATE

Article 1242
The residue of the estate property, after settlement of the liabilities, devolves on the heirs in proportion to
their share in the inheritance.

Article 1243
1- The administrator of the estate shall deliver to the heirs the property of the estate devolving on them.

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2- The heirs may, upon the expiration of the time fixed for the submission of the disputes relating to the
inventory of the estate, demand that all or part of the things or cash which are not required for liquidation be
provisionally delivered to them, with or without security.

Article 1244
The court will, upon request of one of the heirs or of the interested parties, issue a certificate of inheritance
specifying the legal heirs and the share of each in the inheritance.

Article 1245
Each heir may call upon the administrator to deliver to him his share in the estate as a divided part, unless
such heir is obliged to remain in co-ownership by reason of an agreement or a provision of the law.

Article 1246
1- If the request for partition is acceptable, the administrator of the estate will proceed with the partition
provided it will become final only upon the unanimous approval of the heirs.
2- If the heirs do not unanimously approve the partition, the administrator of the estate will ask the court to
effect the partition in accordance with the provisions of the law; the cost of the action in partition will be
deducted from the shares of the heirs.

Article 1247
The partition of an estate shall follow the rules governing partition of property, as well as the provisions of
the following articles.

Article 1248
If there is, amongst the property of an estate, an agricultural, industrial or commercial enterprise
constituting a distinct economic entity and the heirs did not agree on carrying on the exploitation thereof, and
third parties have no claim on such property, it must be allotted as a whole to such one of the heirs who
applies for it if he is the most capable of the heirs to carry on the enterprise, provided that the value of the
property is determined and deducted from his share in the estate. If the heirs are all equally capable of
carrying on the enterprise, it shall be allocated to the heir who offers the highest price, provided that this
price will not be less than the price for similar enterprises.

Article 1249
If, at the time of partition, a debt due to the estate is allocated to one of the heirs, the other heirs are not, in
the absence of an agreement to the contrary, guarantors of the debtor, if he becomes bankrupt subsequent to
the partition.

Article 1250
A will dividing the property of the estate between the heirs of the testator setting out the share of each heir
or of certain of the heirs is valid. If the value of the share of the share so given to one of them exceeds his
hereditary share, the excess is deemed to be a legacy by will.

Article 1251
A partition made by disposition mortis causa may always be revoked. It becomes irrevocable on the death
of the testator.

Article 1252
If the partition does not include all the property of the decedent at the date of his death, the property which
has not been included in the partition devolves in common on the heirs in accordance with the rules of
inheritance.

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Article 1253
If one or more of the contingent heirs included in the division predecease the decedent, the divided part
allotted to him or them devolves in common on the other heirs in accordance with the rules of inheritance
without prejudice to the rules concerning the mandatory will.

Article 1254
The general rules as to partition, with the exception of those relating to lesion, apply to partition made by
disposition mortis causa.

Article 1255
If the debts of the estate are not included in the partition, or if they are included and the creditors do not
agree to the partition, any heir may, if these debts are not settled in agreement with the creditors, petition the
court for partition and settlement of debts, provided that account must be taken, as far as possible, of the
partition made by the decedent and the considerations which guided him to reach such partition.
RULES APPLICABLE TO ESTATES THAT HAVE NOT BEEN LIQUIDATED -3

Article 1256
If the estate has not been liquidated in accordance with the preceding provisions, the unsecured creditors of
the estate may take action, in respect of their claims or legacies, on the immovable property of the estate
which has been alienated or which has been encumbered with real rights to the benefit of third parties,
provided that they have laid down an attachment prior to the registration of the alienations.

SECTION FOUR

ACQUISITION BY WILL

Article 1257
1- A will is an act of disposition taken by a person to be executed after his death.
2- The legatee acquires the ownership of the property bestowed upon him by will.

Article 1258
A will is governed by the rules of the Islamic Shari’a and the law provisions deriving therefrom.

Article 1259
Legal action concerning a will or oral revocation thereof may not, in case of denial, be heard after the death
of the testator unless are found official papers or papers completely written and signed in the handwriting of
the testator, or if the paper on which is written the will or the revocation thereof bears the certified legal
signature of the testator.

Article 1260
1- Every legal act made by a person during an illness immediately preceding his death, with the purpose of
making a gift, is deemed to be a testamentary disposition and will be governed by the rules applicable to wills
regardless of the description given to such an act.
2- The heirs of the decedent have to prove that the disposition has been made by their decedent during an
illness immediately preceding his death. The legal instrument establishing the act cannot be invoked against
the heirs unless the instrument bears a certified date.
3- If the heirs establish that the act of disposition was made by the decedent during the illness immediately
preceding his death, the act is deemed to be a gift, unless otherwise proven by the beneficiary of such act or
there exist special provisions to the contrary.

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Article 1261
When a person disposes of a property in favor of his heirs, reserving at the same time the possession and
the enjoyment of this property during his lifetime, the disposition is deemed to be a testamentary disposition
and, in the absence of any evidence to the contrary, shall be governed by the rules applicable to wills.

SECTION FIVE

ACCESSION
ACCESSION IN RESPECT OF AN IMMOVABLE PROPERTY -1
A- ACCESSION BY ACT OF NATURE

Article 1262
Alluvium brought by the river to the land of a person becomes his property.

Article 1263
1- The owner of a land displaced as a result of an Act of God may claim such land if it can be determined
for sure. The owner of the enriched land shall guarantee to the owner of the impoverished land payment of its
value and acquire its ownership.
2- Court action regarding the claim of such land will not be heard after the lapse of one year from the date
of such incident.

Article 1264
Large or small islands, formed by nature in the river channel, are deemed to be part of the State domain.

Article 1265
Large or small islands formed within lakes, as well as lakes and sea alluviums are considered State
property.

Article 1266
Land uncovered by the sea, lakes, ponds or swamps, which have no owner are considered State property.
B- ACCESSION BY ACT OF MAN

Article 1267
All constructions, plantations or works existing on the land are, in the absence of evidence to the contrary,
deemed to have been carried out by the owner of the land at his own expense and belong to him.

Article 1268
Constructions erected by the owner of the land, on his land but with materials belonging to another and
without his consent, and if these materials still exist and their recovery is claimed by their owner, the land
owner must return same to him. In case such materials are obsolete or depleted, the owner of the land must
pay its value to their owners. In both instances, an indemnity, if justified, has to be paid.

Article 1269
When a person carries out a construction, plantation or other erections with his own materials on land
which he knows is not his property, without the consent of the owner of the land, the latter is entitled to
demand the removal of these works at the expense of the one who erected them. When the removal is
detrimental to the land, the owner of the land may appropriate these works at their break-up value.

Article 1270
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When a person carries out a construction, plantation or other erections with his own materials on land
owned by a third party, basing himself on a lawful cause, , then if the standing value of these erections is
greater than the value of the land, the author thereof may appropriate the land at a price equal to that paid for
similar land. If the value of the land is not below the value of the added erections, the owner of the land may
acquire the erections at their standing value.

Article 1271
If a third party carries out works with his own materials, with the permission of the owner of the land, the
latter cannot, in the absence of an agreement with regard to these works, demand their removal. The owner of
the land must pay to the third party, if the third party does not himself ask for their removal, the standing
value of these works.

Article 1272
If a third party carries out plantation or other erections with materials belonging to another, the owner of
the materials cannot claim their restitution but he has a claim for compensation against the third party and
also against the owner of the land up to the outstanding amount due by him in respect of the value of the
works.

Article 1273
When one of the share owners, in a divisible common property, builds for himself, without the consent of
the other co-owners, then the property was partitioned and, if the built-up part falls in the lot allocated to the
builder, it becomes his property, but if it falls in the lot allocated to the other co-owner, he may acquire
ownership thereof at their removal value or he may ask the builder to demolish what he erected.
ACCESSION OF MOVABLE PROPERTY-2

Article 1274
When two movables belonging to two different owners become mingled in such a way that they cannot be
separated without deterioration, the Court, in the absence of an agreement between the owners, shall decide
the matter under litigation guided by custom and rules of equity and justice, taking into consideration the
damage already done, the condition of the two parties and their good faith.

SECTION SIX

THE CONTRACT

Article 1275
The ownership of movables, immovable properties and other real rights are transferred by contract
whenever satisfying its basic elements and conditions as set forth in the Law and without prejudice to the
following articles.

Article 1276
Ownership of movables not specified as to their species is transferred only by identification.

Article 1277
Ownership of immovable property and of other real rights are not transferred, either between parties or as
regards third parties, except by registration in accordance with the relative law provisions.

Article 1278
An undertaking to transfer ownership of an immovable property is restricted to the obligation of paying a
compensation if the promisor breaches his undertaking whether or not it provides for compensation.

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SECTION SEVEN

PREEMPTION
GENERAL PROVISIONS -1

Article 1279
Preemption is the entitlement of a co-owner having a share in an immovable property to take the share of
his partner who has transacted his share against its price, in a financial transaction, and for its value in a non-
financial transaction, which indicates that he accepts to take it at its customary value.

Article 1280
The right of preemption belongs to:
1- The Nazir of a mortmain on a common property if the settlor has entitled him to take the share of a co-
owner by preemption for retention purposes.
2- The person entitled to the mortmain property after expiration of its term or after the death of all
beneficiaries, if the mortmain property is a common real estate and one of the co-owners has sold his share in
it.

Article 1281
The right of preemption does not belong to:
1- The beneficiary of a mortmain to part of a real estate held in common between the settlor and another
person, if the co-owner sells his share irrespective of the fact that the beneficiary intended to mortmain the
share that he wanted to take by preemption, unless he is the one entitled, at the end of the mortmain, to the
share to which he is the beneficiary; in which case he shall be entitled to take it by preemption in full
property.
2- The neighbor, in the event of sale of an adjoining property, even if he may nave a right of way through a
lease or an easement.
3- The Nazir of a mortmain on a common property if the non-mortmain share is sold, even if the Nazir
intended to mortmain this share which he wanted to take by preemption, unless the settlor entitles him to take
by preemption for mortmain purposes, in which case he may do so.

Article 1282
A co-owner shall not have a preemption right in the following instances:
1-Crops, whether sold separately or with the land and, in this latter case, preemption may be exercised on
the land alone to the extent of its share in the price, but the crops remain the property of the purchaser.
2- A well, in case the land that it waters is partitioned and the well remains a common property but if the
land is not partitioned, it is subject to preemption whether the co-owner sells his share in it separately or in
conjunction with his share in the land.
3- The precincts of a house or a passageway giving access to it, whether the co-owner sells his share in
each separately or in conjunction with his share in the house, if the house is partitioned but the precincts or
the passageway remain common property between the two co-owners, and if the house is not partitioned the
precincts and the passageway shall be subject to preemption as ancillaries thereto.
4- An animal unless it is attached to a commonly held property, for use in tilling or irrigation or the like,
and the co-owner sells his share in the land and in the animal together, in which case it becomes subject to
preemption as appurtenant to the property.

Article 1283
The person against whom preemption is exercised is the owner of the share of one of the co-owners in full
property supervening upon the ownership of the other co-owner by way of a transaction even if not
pecuniary.

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Article 1284
The preempted property is a divisible real estate transacted by one of the co-owners, even by way of
exchange with a similar real property, or if the real property is a building or trees owned by two co-owners of
a land in mortmain. There will be no preemption if the real property is not divisible.

Article 1285
1- If one of the co-owners sells his share in a commonly held real property and the other co-owners take
this share by preemption, it shall be divided between them according to the shares and not per capital . If
the purchaser is one of them, they shall leave him his share of the preemption in it, up to the purchase price,
and shall not take from him the full share.
2- Shares will be considered as of the date of exercising preemption and not from the date of sale.

Article 1286
1- If the preemptors are of different degrees, the preemption right belongs to the one who participates with
the seller of the preempted property in the pre-determined share in the succession, and, if he forfeits his right,
then to the heir who does not participate in a pre-determined share of the estate and, if this latter forfeits his
right, then to the legatee, unless he forfeits his right, in which case it goes to the co-owner who is a stranger
to the estate.
2- Each of the above-stated shall participate in the preemption of those who come after him in the scale of
preemption but not vice-versa. The heir of each one of them shall substitute him in his preemption right and
in participating in the preemption with those in a lower degree in the scale of preemption.

Article 1287
1-If there are several sales of a real property subject to preemption and the preemptor was unaware of the
several sales, or if he had knowledge but was absent, he shall have the option to take by preemption at any of
the sale prices and pay the chosen price to the purchaser who was in possession of the land even if it is lesser
than the price at which he purchased, and the purchaser shall have a claim for the amount in excess against
the seller. If the preemptor had knowledge of the successive sales and was present, he shall take it at the last
sale price only.
2- If a preemptor accepts a sale, all subsequent rights shall be cancelled and all prior dispositions shall be
affirmed. Any person whose purchase has been consequently annulled shall have a claim against the seller for
the price he has paid to him and not for the value of the property.
3- Under all circumstances, if any defect appears in the property, or if it has been dispossessed, the
purchaser shall be liable for the price of the accepted sale.

Article 1288
A preemptor shall exercise preemption for himself and not for others and if he does exercise it for a third
party, even as a gift to the latter or as a gratuity, the preemption will be annulled and his right to take it for
himself will be forfeited.

Article 1289
1- Preemption after sale shall be established whenever there is a justifying cause for it.
2- A donation for consideration shall be treated as a sale.

Article 1290
The real property giving rise to preemption must belong to the preemptor at the time of purchasing the
preempted property.

Article 1291
Once established, preemption is not foreclosed by the death of the seller, the purchaser or the preemptor.

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Article 1292
Preemption is not allowed on:
a- Property acquired by donation without corresponding consideration, given as a charity or devolving be
inheritance or legacy.
b- Building and trees sold on purpose without the land on which they stand or on building and trees
standing on lands owned by the State.

Article 1293
The right of the preemptor on preemption shall be forfeited in the following instances:
a- If he shares with the purchaser of the share of his co-owner, or buys or leases it from him, even if he
ignores that this shall cause forfeiture of his preemption.
b- If he sells his share even if he has no knowledge that his co-owner sold his share before him.
c- If, within two months and without good reason, he did not ask to take the share by preemption, knowing
that the land has been constructed or planted by its purchaser.
d- If, within two months and without good reason, he did not demand preemption as of the time he has
knowledge of the sale made by the co-owner of his share, if he is present in the country, and as of his return
from voyage and his knowledge of the sale made by his co-owner; if absent at time of the sale. Should he
deny knowledge of the sale, while the purchaser alleges that he knew of it, he will be believed in his denial if
made under oath.

Article 1294
If the preempted property is sold in one deal, the preemptor shall have the option either to take it all or
leave it to the purchaser, but he may not choose to take part of it without the other part unless with the
consent of the purchaser, whether the sold property was one share or divided in several shares and whether
there was one seller or purchaser or several.

Article 1295
If some of the preemptors forfeit their right to preemption, or were absent before exercising their right to it,
the others or those present among them may either take the whole of the preempted property or leave it all
but may not take part of it to the exclusion of the other part without the consent of the purchaser.
In case the person present elects to take the whole preempted property, the provisions of the following
article should be observed.

Article 1296
1- If some of the preemptors were absent before exercising his right to preemption and the present
preemptors choose to take the whole of the preempted property and thereafter arrives one of the absentees, he
will take his share in the preemption from the one present, on the assumption that the preemption is for two
persons only, and if a third one of the absentees arrives he will take his share on the assumption that the
preemption is for three persons, and if fourth one arrives he will take his share on the assumption that the
preemption is for four persons; and so on .so forth.
2- Liability for the price of what they have taken, if dispossessed or upon appearance of a defect shall be
upon the purchaser even if the seller exempted him from the sale prior to taking the sold property from him
by preemption.

Article 1297
The claim for preemption shall not be heard:
1- if the sale is made by public auction according to the procedures prescribed by law;
2- if the sale is made between ascendants and descendants, the spouses, relatives up to the fourth degree or
in-laws up to the third degree;
3- if the preemptor renounces his right to preemption expressly or tacitly.
PREEMPTION PROCEDURES -2
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Article 1298
1- The preemption action must be filed within two months as of the date of knowledge of sale by the
preemptor.
2- Under all circumstances the preemption claim shall not be heard after the lapse of six months as of the
registration date.

Article 1299
1- The action in preemption shall be filed, against the purchaser, with the court in whose jurisdiction the
property is situated.
2- The court shall decide each case relating to the true price of the preempted property and it may grant the
preemptor a respite of one month to pay the amount ordered by the court, otherwise his preemption shall be
declared void.

Article 1300
1- The purchaser may claim before the judge from the preemptor to exercise his right to preemption or
renounce to it. His answer to either option will bind him and, if he does not answer, the judge shall declare
the forfeiture of his right to preemption.
2- If he asks for a respite in order to think it over before giving his answer to exercise his right or renounce
to it, the purchaser may reject his request.
3- Whoever wishes to purchase cannot, prior to the sale, ask the preemptor to exercise his right or renounce
to it, and if he does so prior to the sale and forfeited the preemption, this forfeiture shall not be binding upon
the preemptor.

Article 1301
Without prejudice to the rules relating to registration, the title of the preemptor in the sale shall be
established by order of the court or by taking delivery by consent.
THE EFFECTS OF PREEMPTION -3

Article 1302
The yields of the property from which the purchaser benefited prior to preemption shall be his up to the
time of exercising the preemption. If he has leased it to a third party prior to preemption and the rent was due
lump sum or on monthly basis and the lessee paid the rent, the preemptor may not rescind the lease. The rent
shall belong to the purchaser if the remaining period of the lease, after exercising preemption, does not
exceed one year. If the rent is payable on monthly basis and the lessee did not pay the rent, or if the
remaining period of the lease is more than one year, the preemptor may cancel the lease or affirm it and the
rent shall belong to him after exercising his right to preemption.

Article 1303
1- The acquisition of a preempted real estate, by order of the court or by consent is considered a new
purchase subject to the options of sight inspection and defect by the preemptor even if the purchaser waived
his right thereto.
2- The preemptor is not entitled to benefit from the delay given to the purchaser for payment of the price,
except with the consent of the seller.
3- If the property is dispossessed in favor of a third party, subsequent to the exercise of the right of
preemption, the preemptor shall have a claim for the price against the seller or the purchaser, whoever
received it from him.

Article 1304
1- If, prior to the action in preemption, the purchaser made some additions to the preempted property out of
his own funds, or has built or planted trees, the preemptor shall have a choice either to abandon his right to

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preemption or acquire the ownership of the property at the price thereof together with the increase in value as
a result of the addition or of such construction or plantation.
2- When, however, such addition, construction or plantation has been made after filing the action in
preemption, the preemptor may abandon his right to preemption or demand their removal, if appropriate, or
accept the status quo after paying the bare value of the addition or of what has been newly introduced to the
land, if removed.
3- If the preempted property has been diminished for a reason not imputable to the purchaser, or by his act
but serving some interest, the preemptor may take it for its full price and shall have no claim with respect to
the diminution, or may leave it to the purchaser. If diminution is caused by his act which serves no interest,
then the price due by the preemptor shall be reduced by the value of such diminution.

Article 1305
The preemptor may quash all the purchaser’s dispositions even if the preempted property is put into
mortmain or affected as a place of worship.

Article 1306
Mortgages, as collateral, or a privilege right for or against the purchaser on the preempted property shall
have no effect against the preemptor if completed subsequent to the filing of the action in preemption. The
creditors shall maintain their rights on the price of the property.

SECTION EIGHT

POSSESSION
GENERAL PROVISIONS -1

Article 1307
1- Possession is the actual domination of a person, by himself, over a thing or right which may be
negotiated.
2- Possession by an intermediary is valid whenever the intermediary acts in the name of the possessor and
that his relationship to the possessor is such that he is obliged to obey his instructions as regards the
possession
3- The individual lacking discretion may acquire possession through his legal representative.
4- Possession does not result from an act done by permission or merely tolerated.

Article 1308
Possession obtained by duress or obtained secretly or in a dubious manner has no effect, as regards the
person against whom the duress, secrecy or dubious means are exercised, except from the time that such
defects have ceased to exist.

Article 1309
1- Possession is deemed continuous as from the time it becomes apparent through using the thing or the
right in a normal and regular manner.
2- Whoever alleges that he has acquired ownership by lapse of the limitation period may rely on the
possession of the person from whom the property was transmitted to him.
3- The tenant, the usufructuary, the bailee, the borrower or their heirs may not plead limitation of time.

Article 1310
Possession is transmitted by a possessor to another by mutual agreement, provided that the person to whom
the possession has been transmitted is able to assume control over the thing or the right, object of possession
even without actual delivery.

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Article 1311
1- If several persons are in dispute as to the possession of the same thing or right, the possession shall
provisionally be deemed with the one who has the physical possession unless it is established that he has
obtained such possession in a defective manner.
2- In the absence of a proof to the contrary, possession shall maintain the same character with which it
started.

Article 1312
In the absence of proof to the contrary, the possessor of a thing shall be considered of good faith if he has
no knowledge that he is trespassing on the right of others.

Article 1313
1- The possessor shall cease to be of good faith only as of the time he becomes aware that his possession
constitutes a trespass to the right of others.
2- Likewise, the good faith character shall cease to exist as of the time the possessor is notified in the
pleadings of the defects of his possession.
3- Whoever usurps by duress the possession of another person shall be considered of ill-faith.

Article 1314
Possession ceases when the possessor abandons his actual control over the thing or the right or loses it in
any other way.

Article 1315
1- Possession does not cease if a temporary obstacle prevents the possessor from exercising his actual
control over the thing or the right.
2- The claim as regards possession shall not be heard if such obstacle continues for a whole year and is the
result of a new possession exercised against the wish or without the knowledge of the possessor.
3- The period of one year runs from the moment from which the new possession commences, if it takes
place overtly, or from the day on which the former possessor knew of it, if it commences secretly. In the
presence of a major obstacle preventing the filing of the claim, the period of one year is computed as of the
time it becomes possible to file the claim.

Article 1316
If the possessor brings a hands-free action in court in order to restitute his possession, he is entitled to
demand preventing the defendant from erecting constructions or planting trees in the disputed land as long as
the case is under examination, provided that he submits sufficient securities to cover the indemnity payable to
the defendant for the prejudice that he may sustain in case it is revealed that the claimant is unjustified in his
claim.
EFFECTS OF POSSESSION -2
A- ACQUISITIVE PRESCRIPTION

Article 1317
A person who possesses a movable or an unregistered immovable property considering himself the title
owner thereof, or possesses a real right on a movable or on an unregistered immovable property, and his
possession continues without interruption for fifteen years, shall not be actionable in property or in rights in
rem by any person who has no legitimate justification.

Article 1318
1- If the object of possession be an unregistered immovable property or a real right in rem and the
possession has been acquired in good faith and, at the same time, based on a valid cause, the period barring
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the hearing of the case shall be seven years.

2- A valid cause is a document or an event proving possession of a real estate. Shall be considered a valid
cause:
a- Transfer of title by inheritance or legacy.
b- A gift inter vivos with or without consideration.
c- Sale and bartering.

Article 1319
1- No claim as to the origin of a mortmain property or as to inheritance can be heard if they could be
brought, but failure to do so is not based on a legitimate cause, against a person in possession of a real estate
who acted as an undisputed owner for an uninterrupted period of thirty years.
2- Ownership of assets and real estates owned by the State, or its public organizations, as well as assets and
real estates belonging to the charitable Wakf, cannot be acquired or be subject to rights in rem by
prescription.

Article 1320
1- No claim for absolute ownership, inheritance or mortmain bestowed on progeny, against the possessor
of a real estate, shall be heard if such property has been in his possession and in the possession of the person
from whom he acquired it by sale, gift, will or inheritance or otherwise, the period set forth for the
prescription of such claims.
2- In the absence of proof to the contrary, actual possession coupled with an established previous one is a
presumption that it existed between the two periods of time.

Article 1321
No one can set up prescription barring the hearing of a claim in absolute property, if he is in possession of
a real estate by virtue of a deed other than a property title. He cannot, on his own and for his benefit, change
the cause and the origin of his possession.

Article 1322
The period of limitation barring the hearing of a property claim shall not run as long as there exists
between the right owner and the claim a legitimate excuse.

Article 1323
The period of limitation is not interrupted by dispossession if the owner of the real estate if possession is
reinstated to him or an action in reinstatement thereof is filed within a period of one year.

Article 1324
The rules barring a claim, relative to rights of possession, by prescription shall apply to the calculation of
the period, its cessation, interruption, raising the issue before the court, waiver thereof and agreement on
modification of the period; within the limits that these rules are not in contradiction with possession and
without prejudice to the foregoing provisions.
B- POSSESSION OF MOVABLES

Article 1325
1- No claim of ownership shall be heard against whoever possesses a movable property or a right in rem
over a movable or a bearer warrant and his possession is based on a valid cause and in good faith.
2- Subject to proof to the contrary, mere possession is a presumption of ownership.

Article 1326

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1- As an exception to the provisions of the foregoing article, the owner of a movable or a bearer warrant
who has lost it or has been robbed of or extorted, can, within three years from the date of the loss, the theft or
the extortion, recover it from the one who possesses it in good faith. The provisions governing extorted
movables shall apply to such recovering.
2- When the thing robbed, lost or extorted is found in possession of a third party who bought it in good
faith on the market, at a public sale or from a merchant trading similar articles, such third party is entitled to
recover from the person claiming restitution the price he has paid for the thing.
C- THE RECOVERY OF FRUITS

Article 1327
A possessor in good faith acquires all fruits collected and benefits obtained during his possession.

Article 1328
1- A possessor in bad faith is responsible for all the fruits that he has collected or that he has failed to
collect from the moment he became of bad faith.
2- He may, however, claim refund of his expenses in connection with the production of these fruits.
D- RECOVERY OF EXPENSES

Article 1329
1- The owner to whom the property is restituted must pay to the possessor all expenditure incurred by him
that were necessary for the preservation of the thing from destruction.
2- As concerns useful expenditure, they shall be governed by the provisions of articles 1270 and 1272 of
the present Law.
3- The owner is not liable to refund the expenses of a luxurious nature. The possessor may, however,
remove works he has made with these expenses, provided he restores the thing to its original condition,
unless the owner prefers to keep the works upon payment of their break-up value.

Article 1330
A person who takes possession from a previous owner or possessor may, if he establishes that he has paid
to his predecessor the expenditure incurred by him, demand repayment from his predecessor or from the
person claiming restitution of his ownership.
E- LIABILITY IN THE EVENT OF LOSS

Article 1331
1- A possessor in good faith who has enjoyed the thing under the belief that it is his right is not liable to
pay any compensation on this account to the person to whom he must restitute the thing.
2- The possessor in good faith is not liable for the loss or deterioration of the thing except up to the amount
of compensation recovered or security obtained as a result of such loss or deterioration.

Article 1332
If the possessor is in bad faith, he is liable for the loss or deterioration of the thing even if it resulted from a
fortuitous cause beyond his control.

TITLE TWO

RIGHTS DERIVING FROM THE RIGHT OF OWNERSHIP

CHAPTER ONE
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RIGHTS OF USUFRUCT, USE, DWELLING AND USE OF THE LAND OF ANOTHER AND
SETTLEMENT

SECTION ONE

USUFRUCT
GENERAL PROVISIONS -1

Article 1333
Usufruct is right in rem given to the usufructuary in order to use a real estate owned by another and exploit
it as long as it remains as it is.

Article 1334
The right of usufruct may be acquired by a legal act, by preemption, by inheritance or by prescription.

Article 1335
The provisions concerning usufruct of lands owned by the State are governed by a special law.
THE EFFECTS OF USUFRUCT -2

Article 1336
The rights and obligations of a usufructuary are governed by the deed establishing the usufruct and by the
provisions contained in the following articles.

Article 1337
The usufructuary is entitled to the fruits of the property that is subject to usufruct all through the period of
usufruct.

Article 1338
1- The usufructuary may dispose of the property subject to usufruct the usual manner if the usufruct deed is
free of any restriction.
2- If it is subject to a restriction, the usufructuary may dispose of it as it is or by similar or lesser act of
disposition.
3- The owner of the property may object to any use of it that is unlawful or unsuitable to the nature of the
property which is subject to usufruct and may petition the court to terminate the usufruct and order restitution
of the property, without prejudice to the rights of third parties.

Article 1339
1- The usufructuary is liable during the continuance of the enjoyment for all normal charges required for
the preservation and maintenance of the property subject to the usufruct.
2- In the absence of an agreement stipulating otherwise, the abnormal expenses and the cost of heavy
repairs which did not arise from any fault on the part of the usufructuary, they will be charged to the owner.

Article 1340
1- The usufructuary must preserve the thing subject to usufruct with the usual diligence of a normal person.
2- He is not responsible for the deterioration or loss of the property which occurred without any violation
or negligence from his part.

Article 1341

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The usufructuary is liable to pay the value of the thing that is subject to usufruct if it is deteriorated or lost
after the termination of the usufruct, if he has delayed to restitute the property to its owner while he could
have done so and even if the owner did not ask him to restitute it and even if he did not use the ting after the
lapse of the usufruct period.

Article 1342
1- The usufructuary must give notice to the owner:
a- If a third party claims to have a right over the thing which is subject to usufruct or is usurped;
b- If the thing perishes or deteriorates or requires major repairs the cost of which should be borne by the
owner;
c- If it is necessary that he takes protective measures against unforeseen danger.
2- If the usufructuary fails to give such notice, he shall be liable for the prejudice sustained by the owner.

Article 1343
1- The usufructuary may consume the movables subject to usufruct if it can be enjoyed only by
consumption and has to return a similar thing or its value after the termination of his usufruct right. He also
have to pay damages if the thing perishes prior to enjoyment or without any wrongful act from his part, being
considered a loan.
2- If the usufructuary dies before returning the movables referred to above to their owner, he must secure
their substitute ot their value in his estate.
EXTINGUISHMENT OF THE USUFRUCT RIGHT -3

Article 1344
The usufruct right ends:
a- by the lapse of fifty years, unless another period is specified in the deed establishing such right.
b- by the loss of the property that is subject to usufruct;
c- if the usufructuary renounces to his right;
d- by an order of the court due to misuse.
2- by uniting the two capacities of owner and usufructuary in the same person unless the owner has an
interest to maintain it, such as if the property is pledged.

Article 1345
When the period set for the usufruct expires and there are standing crops on the land which is subject to
usufruct, the land is left to the usufructuary against a fair rent until the crop matures and is harvested, unless
the law provides otherwise.

Article 1346
1- When the usufruct right is terminated by the loss of the thing, and compensation is paid or a security
given, the right of the usufructuary is transferred to the compensation or the secured amount.
2- If the loss is not due to a fault of the owner, he is not compelled to return the thing to its status quo ante
but if he does, the usufructuary recovers his right of usufruct if the loss is not imputable to him; unless
otherwise agreed.

Article 1347
Renouncement by the usufructuary to his usufruct right does not affect neither his obligations towards the
owner of the property subject to usufruct nor the rights of third parties.

Article 1348

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The action concerning the claim of the usufruct right shall be barred by prescription if the claimant did not
use his right for fifteen years.

SECTION TWO

THE RIGHT OF USE AND THE RIGHT OF DWELLING

Article 1349
Usufruct may apply to the right of use or to the right of dwelling or to both together.

Article 1350
The extent of the right of use and the right of dwelling is determined by the need of the right owner and his
family, for themselves only, subject to the deed instituting the right.

Article 1351
The right of use and the right of dwelling may only be assigned to third parties by virtue of an express
provision in the deed instituting the right or for an extreme necessity.

Article 1352
The provisions governing the usufruct right apply to the rights of use or dwelling to the extent they are not
in contradiction with the foregoing provisions and with the nature of such two rights.

SECTION THREE

THE RIGHT TO USE THE LAND OF OTHERS (AL MUSSATAHA)

Article 1353
The mussataha is a right in rem giving its owner the right to erect a construction or to plant on a land
owned by another.

Article 1354
1- The right of mussataha is acquired by agreement or by prescription.
2- It is transferred by inheritance or by legacy.
3- The deed instituting the right shall govern the rights and obligations of the owner of this right.

Article 1355
1- The right of mussataha may be assigned or pledged.
2- It may be subject to easements provided it is not incompatible with its nature.

Article 1356
1- The period of mussataha may not exceed fifty years.
2- When a period is not fixed, either the right owner or the owner of the land may terminate the contract.

Article 1357
The owner of the mussataha right is the owner of all newly added constructions and plants and he may
dispose of in conjunction with the right of mussataha.

Article 1358
The right of mussataha ends:
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1- by the expiration of the period;

2- by merging the two capacities of land owner and right owner in the same person;
3- if the right owner fails to pay the agreed consideration for two years, unless otherwise agreed.

Article 1359
The right of mussataha does not end by the removal of the construction or the plants prior to the expiration
of the period.

Article 1360
Upon termination of the mussataha right, the constructions and plants shall, unless otherwise agreed, be
subject to the provisions of Article 785 of the present Law.

CHAPTER TWO

WAKFS

Article 1361
The Wakf shall be subject to the provisions enacted by a special law.

CHAPTER THREE

SERVITUDES

SECTION ONE

ESTABLISHMENT OF SERVITUDE RIGHTS

Article 1362
1- Servitude is a right which limits the enjoyment of a property for the benefit of another property
belonging to another owner.
2- A servitude may be imposed on a public property in so far as it is not incompatible with the use for
which such property is intended.

Article 1363
1- The right to a servitude is acquired by grant, by a legal disposition or by inheritance.
2- Apparent servitudes, including rights of way, canal rights and water passage are also acquired by
prescription unless it is established that the right is unlawful, in which case the damage must be made good
irrespective of how old it is.

Article 1364
Whoever allowed the use of a servitude over a land he owns may withdraw his permission whenever he
wishes.

Article 1365
1- In the absence of an agreement to the contrary, specific restrictions imposed limiting the right of the
owner of a property to build thereon are considered servitudes on such property in favor of properties to
whose benefit these restrictions have been imposed.
2- Any breach to these restrictions gives rise to a claim for material redress or to damages if justified.

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Article 1366
In the absence of an agreement to the contrary, when the owner of two separate properties has constituted
an apparent servitude between the two, such servitude shall remain if title to the two properties, or one of
them, is transferred to other owners without any change in the status of these properties.

SECTION TWO

SCOPE OF THE SERVITUDES

Article 1367
The scope of the servitude right is delimited by the deed establishing it, by the prevailing custom in the
location in which the property is situated and by the following provisions.

Article 1368
The owner of the dominant tenement is entitled to use his right within the lawful limits and to carry out any
works necessary to use and preserve his right without increase in the burden of usufruct; he must use his right
in the least harmful manner.

Article 1369
1- The cost of the necessary works for the use and preservation of the servitude must be borne by the
owner of the dominant tenement.
2- If the works also benefit the owner of the servient tenement, the cost of upkeep falls on the two parties
in proportion to the profit derived by each of them.
3- If the owner of the servient tenement is responsible for carrying out these works at his own cost, he has
always the right to free himself of this burden by abandoning the servient tenement wholly or in part to the
owner of the dominant property.

Article 1370
The owner of the servient tenement has no right to do anything which will affect the use of the servitude,
or to change its status, unless the enjoyment in the original place has become more burdensome to the owner
of the servient tenement, or prevent him from carrying out the useful improvements. The owner of such
property may then demand that this right be transferred to another place where he is able to use his right as
easily as he was able to do at the original place.

Article 1371
1- If the dominant tenement is divided, the servitude continues to benefit each part thereof, provided that
the burden on the servient property.
2- If, however, the servitude only benefits some of these parts, the owner of the servient tenement may
demand that ir ceases as regards the other parts.

Article 1372
1- If the servient tenement is divided, the servitude continues to susist in respect of each part thereof.
2- If, however, the servitude is not actually used and cannot be used on certain of these divided parts, the
owner of each of them may demand that it ceases as regards the part belonging to him.

SECTION THREE

EXTINCTION OF SERVITUDES

Article 1373

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The right to servitude ceases to exist by the expiration of the period for which it was established or by the
total loss of the tenement object of the servitude.

Article 1374
The right to servitude ceases to exist when both the dominant and the servient properties have the same
owner; the right to servitude is, however, revived if the cause of extinction ceases retrospectively to exist.

Article 1375
The right to servitude ceases to exist if conditions of both the servient and dominant properties so change
that the right can no longer be used; the right to the servitude is, however, revived if the conditions return to
their status quo ante.

Article 1376
The right to the servitude ceases to exist if its owner ceases to use it and gives notice in this respect to the
owner of the servient tenement.

Article 1377
The right to the servitude ceases to exist if the servitude has lost its utility for the dominant tenement or if
its actual utility has been reduced out of proportion to the burden imposed on the servient tenement.

Article 1378
1- The claim to a right of servitude is barred by non use for a period of fifteen years.
2- When the dominant property is owned by several partners in common, the use of the servitude by one of
the co-owners interrupts the prescription in favor of the other co-owners; likewise, the suspension of
prescription in favor of the co-owners suspends prescription in favor of all other co-owners.

SECTION FOUR

SPECIFIC SERVITUDES
THE RIGHT OF WAY -1

Article 1379
If it is established that some one has a right of way on a land owned by another, the owner of such land
may not prevent him unless his passage over the land is an act of forbearance.

Article 1380
The owner of a property that has no access to the public road, or if such access is achieved at exorbitant
expense or with exhaustive effort, is entitled to a right of way on the adjacent land up to a usual extent, for a
reasonable consideration, and this right may only be used on the property through which passage is less
harmful and over such part as will achieve such purpose.

Article 1381
If access to the public road is prevented due to the partition of the property by a legal disposition, a right of
way may only be requested on parts of this property.
WATER EASEMENT -2

Article 1382
Water easement consists in drawing water, in turns, for the purpose of irrigating land or plants.

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Article 1383
Every person may enjoy the use of water sources and its ramifications of public interest in accordance with
the provisions of special laws and regulations.

Article1384
1-Whoever makes a stream or water course for the irrigation of his land, no one else is entitled to use it
without his permission.
2- The neighboring owners may, however, use the stream or water course as required for the irrigation of
their land after the owner has satisfied his needs therefrom. The neighboring owners, in this case, have to
participate in the expenses of making and maintaining the stream or water course in proportion to the area f
their lands which benefit from it.

Article 1385
None of the partners in a water source or the common stream may dig a channel from it except with the
permission of the other partners.

Article 1386
In case the right owners of the water easement do not agree to carry out the necessary repairs to the water
sources, its branches and common stream, they may be compelled to do so, in proportion to their shares, upon
the request of any of them.

Article 1387
Water easement may be inherited and the use of it may be bestowed by legacy but may not be sold except
in conjunction with the land and may neither be donated nor let.
IRRIGATION EASEMENT -3

Article 1388
1- The irrigation easement is the right of the owner of a land to have irrigation water pass through the land
of another person to reach from its distant source to its land.
2- If this right is established in favor of someone, the owners of adjacent lands in which these waters run
may not prevent him from enjoying this right.

Article 1389
If the irrigation easement is established in favor of someone in a servient property owned by another who
sustains a prejudice, the owner of the water duct has to repair it in order to remove the prejudice. Should he
abstain from doing so, the owner of the servient property may carry out the repairs at the expense of the
duct’s owner within customary limits.

Article 1390
1- Every owner willing to irrigate his land from natural sources or from artificial sources that he has the
right to dispose of, may have a water passage through the intermediate lands to his land, provided that he
pays an advance compensation and further provided that such act does not seriously and adversely interfere
with the right of the owner of the intermediate land to enjoy his right. If the land sustains, as a result thereof,
damage, the owner of the land may claim a compensation for the damage sustained.
2- The owner of the land has to allow the necessary works on his land for the passage of water to a
neighboring land against an advance payment of compensation and he may benefit of such construction
works provided he bears a consideration for such use commensurate with the benefit he derives therefrom.

Article 1391

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Should the owner of the intermediate property incur damage caused by the construction works referred to
in the preceding article, he may require from those who benefited from such works to make good the damage
caused.
THE ACQUAE DUCTUS EASEMENT -4

Article 1392
The Acquae ductus easement is a manner to arrange for the flow of the natural water or the drainage of the
unusable water or that in excess of requirements by having it pass through the land of others.

Article 1393
1- The lower lands receive the waters naturally flowing from higher lands without a human intervention in
the flow.
2- The owner of the lower land may not erect a dam to prevent such flow.
3- The owner of the higher land may not, likewise, carry out any act which may increase the burden of the
lower land.

Article 1394
The owner of an agricultural land has the right to drain the unusable water or that in excess of his
requirements by having it pass through the land of others in consideration of an adequate compensation.

Article 1395
Owners of the lands through which runs ducted water may benefit from the installations specific for the
drainage of these waters, provided that each one of them bears the costs of erecting, modifying and
maintaining in proportion to the benefit drawn therefrom by each.

Article 1396
No one is allowed to erect a harmful acquae ductus on the land of others or on a public or private road. The
damage must be removed no matter how old it is.

Article 1397
The owners of new installations may not drain their ducted water to the property of another person without
his permission unless they have the right to do so.

Article 1398
1- Without prejudice to special laws and regulations, the property owner has to prepare the surface of his
land in such a manner as to allow the flow of rain water on his land or on a public or private road.
2- He is not allowed to drain this water to the adjacent land unless this right was anciently acquired.

BOOK FOUR

REAL SECURITIES

TITLE ONE

MORTGAGES

CHAPTER ONE
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DEFINITION AND CONSTITUTION OF A MORTGAGE

Article 1399
Mortgage is a contract by which a creditor acquires, over an immovable property allocated for the payment
of his debt, a real right by which he obtains preference over ordinary creditors and creditors following him in
rank, for the repayment of his claim out of the price of such property, no matter into whose hands it has
passed.

Article 1400
A mortgage can only be constituted by registering it and, in the absence of an agreement to the contrary,
the cost of the contract is to be borne by the mortgagor.

Article 1401
1- The mortgagor must be the owner of the mortgaged property and must have legal capacity to dispose of
it.
2- The mortgagor may be the debtor himself or a real guarantor who consents to mortgage his property for
the benefit of the debtor.

Article 1402
The mortgage of someone’s else property is not allowed unless the true owner ratifies it by an official deed.

Article 1403
1- A father may mortgage his property to his minor son and, in case of his inexistence, the true grandfather
(from the father’s side), may mortgage his property to his grandson.
2- If the minor son is indebted to his father, he may mortgage, in his favor, his son’s property.
3- The father or the true grandfather may mortgage the minor’s property to secure a debt on the minor
himself.
4- He may also mortgage the property of one of his minor sons in favor of his other minor son to secure a
debt owed by the former to the latter.
5- Neither the father nor the true grandfather may mortgage the property of the minor to secure a debt
owed to a third party from the father or grand father.
6- In the instances mentioned in clauses 2, 3, and 4 above, the authorization of the court is a must.

Article 1404
1-The guardian may, by authorization of the court, mortgage the minor’s property or that of an interdict,
held by a third party as a security owed to this third party by any of the two.
2-He isn’t allowed to mortgage his money at the young or the interdict or to mortgage the money of either
of them to himself.

Article 1405
The real property mortgaged as a security for a debt must be tangible and existing upon laying the
mortgage.

Article 1406
1- A mortgage securing a debt can only be laid on an immovable property, negotiable and capable of being
sold by public auction, or a real right on an immovable property.
2- The Court may annul the mortgage contract in case the mortgaged property is not specifically and
sufficiently described in the contract.

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Article 1407
The mortgage extends to the accessories of the mortgaged immovable property, namely buildings, plants,
fixtures and all newly added constructions subsequent to the contract.

Article 1408
1- A co-owner in an immovable held in common is entitled to mortgage his share which shall, after
partition, be transferred to the divided share allotted to him, without prejudice to its transcription with the
land registry department.
2- Amounts due to him as a result of equalizing the shares, or the proceeds of sale of the land shall be
appropriated to reimburse the debt for which the mortgage was made.

Article 1409
The consideration for a security mortgage must be a fixed sum due, or promised to be paid, determined
upon mortgage or one of the secured real estates.

Article 1410
The security mortgage is indivisible; every part of the mortgaged property shall secure the whole of the
debt, and each part of the debt is secured by the mortgaged property.

Article 1411
The provisions relating to security mortgage shall apply to movables which have to be registered in
accordance with their specific legislations.

CHAPTER TWO

EFFECTS OF THE SECURITY MORTGAGE

SECTION ONE

EFFECTS OF MORTGAGE BETWEEN THE CONTRACTING PARTIES

AS REGARDS THE MORTGAGOR -1

Article 1412
A mortgagor may dispose of the property mortgaged as security but any disposal by him shall not affect the
rights of the mortgagee.

Article 1413
1- The mortgagor may carry on the management of the mortgaged property and collect the fruits thereof up
to the date of the forced expropriation of his ownership due to non-payment of the debt.
2- The fruits shall become incorporated in the mortgaged property as of the date of expropriation.

Article 1414
The mortgagor warrants the mortgaged property and is held responsible for its safety until the
reimbursement of the debt. The mortgagee may oppose any act that diminishes his warranty and may take all
measures preserving his right and claim from the mortgagor the expenses incurred in this respect.

Article 1415
1- If the mortgaged property perishes or deteriorates by the fault of the mortgagor, the mortgagee may
either claim immediate payment of his debt or adequate security for his debt.

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2- If the loss or deterioration is not imputable to the mortgagor, he may chose either to furnish adequate
security or pay the debt in full before it falls due.
3- If acts are done which may result in the loss or deterioration of the mortgaged property, or which may
render the mortgaged property insufficient to secure the debt, the mortgagee may apply to the Court to order
the cessation of such acts and the adoption of the necessary measures to avoid the occurrence of the
prejudice.

Article 1416
In the event of loss of or deterioration to the mortgaged property, the mortgage is transferred to any right
obtained in substitute thereof such as compensation, the insurance amount or payment on account of
expropriation for public utility. The mortgagee may recover his right from these sums according to the order
of his rank.

Article 1417
If the mortgagor was a surety in rem, the debt may only be recovered from the mortgaged property and the
mortgagor may not ask to refer to the debtor for payment before execution on his property.
AS REGARDS THE MORTGAGEE -2

Article 1418
In a security mortgage, the mortgagee may assign his right to another person provided he obtains the
approval of the debtor and the deed of assignment must be registered with the Land Registry Department.

Article 1419
1- The mortgagee may recover his debt from the mortgaged property upon maturity of the debt in
accordance with the order of his rank and after taking the measures provided for in the Law on the
procedures before the civil courts and the special laws.
2- If the property does not fully cover his debt, he may obtain satisfaction for the balance of the debt from
the debtor’s properties as an ordinary creditor.

Article 1420
1- If it is specified as a condition in the mortgage contract that the creditor, in case of non payment, on
maturity, of the debt by the debtor, is entitled to acquire ownership of the mortgage property; or to sell such
property without observing the law procedures, the contract is valid but the condition is void.
2- The condition is likewise void if it is embodied in a subsequent agreement.

Article 1421
1- An effective lease, already entered into by the mortgagor, shall be of no effect as against the mortgagee
unless bearing an officially fixed date prior to the mortgage.
2- As for the deferred lease which commences after the expiration of the effective prior lease, it shall
absolutely have no effect as regards the mortgagee unless recorded in the mortgage contract.

SECTION TWO

EFFECT OF THE MORTGAGE AS REGARDS THIRD PARTIES

GENERAL PROVISIONS -1

Article 1422
A security mortgage shall be effective against third parties only if registered before third parties have
acquired a right in rem on the mortgaged property.

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Article 1423
In the absence of a contrary provision in the law or in the agreement, the effect of a security mortgage is
limited to the amount specified in the mortgage deed and recorded with the Land Registry Department.

Article 1424
Neither the transfer of a security mortgage nor the assignment thereof, or waiver of the order of its rank,
shall have any effect as regards third parties unless recorded on the original deed evidencing the right and
registered.
PREFERENCE RIGHT -2

Article 1425
1- The debts due to the creditor mortgagees in a security mortgage shall be paid from the price of the
mortgaged property, or from the substitute amount, by order of the rank of each, even if they registered the
same day.
2- This rank is determined by the serial number of registration. If several persons present themselves at the
same time to register their mortgages against the same debtor and on the same property, the registration of
these mortgages shall take the same serial number and, upon distribution, they shall be considered of the
same rank.

Article 1426
A mortgagee may, within the limits of his secured debt, assign his rank in favor of another creditor having
a mortgage on the same mortgaged property. All defences available against the first creditor, with the
exception of those connected with the extinction of his claim when that extinction occurs after the assignment
of the rank, can be raised against the second creditor.

Article 1427
1- A mortgagee’s rank is determined as of the date of its inscription.
2- He shall keep his rank until any indication of its extinction is recorded at the Land Registry Department.

Article 1428
The registration of the security mortgage entails the tacit inclusion of the expenses of the contract and of
the registration in the mortgage debt and its rank.
THE TRACING RIGHT -3

Article 1429
The mortgagee is entitled to trace the mortgaged property into the hands of whoever possesses it in order to
recover his debt upon maturity thereof, in the order of his rank.

Article 1430
A mortgagee may, upon maturity of the debt, take proceedings for the expropriation of the mortgaged
property and the sale thereof, in case the debt is not paid on its due date, after notification of the debtor and
the possessor of the property in accordance with the procedures set forth in the Law on procedures to be
followed before the civil courts , and the special laws.

Article 1431
Shall be considered a third party possessor of a mortgaged property whoever, subsequent to the mortgage,
acquires the title thereto, or to any other right in rem on it, for any reason, without being personally liable in
respect of the debt secured by the mortgage.

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Article 1432
The third party possessor of a mortgaged property may, upon maturity of the debt secured by the mortgage
and after being summoned, pay the debt and the expenses and claim from the debtor the amount paid by him
in this respect. He may also be subrogated into all rights of the creditor who has recovered his debt.

Article 1433
The third party possessor of a property secured by a mortgage is entitled to purge the property to which he
acquired the title of any right in rem over it encumbering the property, as a security for a transcribed debt, by
paying the debt prior to the sale of the property or within the delays prescribed by the Law on procedures to
be followed before the civil courts , and the special laws.

Article 1434
In case of default in paying the debt, the proceedings of forced expropriation shall be those provided for in
the Law on procedures to be followed before the civil courts , and the special laws.

Article 1435
The third party possessor of a property secured by a mortgage may be a joinder in the proceedings of the
sale of the property by auction. If the auction is knocked down to his favor and the price is paid by him, he
shall be considered the owner of the property by virtue of his original title deed and the property shall be
purged of the registered right.

Article 1436
If the auction of the real property pledged as a security is knocked down to a person other than its holder,
the latter will hold his right to it by virtue of the judgment of adjudication from the holder.

Article 1437
1- The holder of the property is liable for any damage or impairment occurring to the pledged property
according to the rules governing liability provided for in this Law.
2- He is bound to restitute the yields of the property as of the date he is summoned to pay the debt.

Article 1438
In case the price of the sold property exceeds the value of the secured debt, the difference in excess belongs
to the holder and his pledgee-creditors may be paid out of this excess.

Article 1439
1- The holder has, against the preceding owner, a right of action for warranty to the extent that a successor
in title has against the person from whom he has acquired the property for valuable consideration or as a gift.
2- The holder has also a right of action against the debtor for payment of any sums paid by him, for any
reason whatsoever, in excess of the amount due by him in accordance with his title deed. He is subrogated
into the rights of the creditors discharged by him, particularly into the guarantees furnished by the debtor, but
not into those furnished by a person other than the debtor.

CHAPTER THREE

EXTINGUISHMENT OF THE SECURITY MORTGAGE

Article 1440
1- The security mortgage is extinguished when the secured debt is extinguished in full.
2- If the cause by reason of which it was extinguished disappears, the mortgage is revived to its status quo
ante, without prejudice to the rights of bona fide third parties acquired in the interval between the
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extinguishment of the right and its revival.

Article 1441
1- The debtor has to pay the debt secured by mortgage and its accessories prior to the lapse of the period
set for its payment.
2- Should the creditor refuse such payment, the debtor may deposit it with the transcription department
which, after ascertaining its value, will settle what is due by the debtor and deliver him the deed of discharge
and purge the mortgage, without prejudice to the special laws provisions.

Article 1442
The security mortgage is extinguishes by selling the mortgage property in accordance with the Law on
procedures to be followed before the civil courts and the special laws together with payment of the
proceeds of the sale to the privileged creditors according to the rank of each, or deposit the amount thereof.

Article 1443
The security mortgage is extinguished by transfer of title of the mortgaged property to the mortgagee or
transfer of the right to mortgage to the mortgagor, provided that it is revived if the cause disappears with
retrospective effect.

Article 1444
The security mortgage is extinguished if the mortgagee creditor waives his right to it.

Article 1445
1- The security mortgage is extinguished by the destruction of its object.
2-The provisions relating to the perishing of the mortgage property stated in this law must be observed.

Article 1446
1- If the limitation period, barring the claim of the secured debt, expires the mortgagee may apply for a
judgment purging the mortgaged property.
2- If the mortgaged property is transmitted to a possessor, he may submit a plea of non admittance to hear
the action on grounds of prescription of the secured debt should the mortgagee abstains without cause from
filing a mortgage case against him within a period of fifteen years.

Article 1447
A security mortgage is not extinguished by the death of the mortgagor or mortgagee but remains in effect
as concerns the heirs.

TITLE TWO

PLEDGE

CHAPTER ONE

DEFINITION AND CONSTITUTION OF A PLEDGE

Article 1448
Pledge is a contract constituting a right to retain a property in the hands of the creditor, or a third party
holder, as security of a right that can be recovered from it, in full or in part, in preference to all other

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creditors.

Article 1449
The thing pledged must be deliverable upon pledge and apt to be sold by public auction.

Article 1450
1- Fruits may be pledged before ripening but may not be sold in recovery of a debt except thereafter. If the
pledgor is declared bankrupt or is dead prior to the ripening of the fruits, the pledgee shall rank with the other
creditors in settlement of his debt out of the other assets of the pledgor.
2- If the fruits ripen subsequent to distribution, they shall be sold and the proceeds shall be allocated to the
pledgee who shall restitute to the other creditors all what he has obtained from the distribution, if the
proceeds obtained are equal to the debt, and in case they are less he shall restitute to them the amount in
excess of what he would have received had he initially participated with them for the balance of his debt after
receiving the sale proceeds of the pledged fruits.

Article 1451
Perishable things may be pledged for a deferred debt and, if possible preserved, otherwise it shall be sold
by auction and the proceeds of the sale shall be pledged instead.

Article 1452
The consideration for a pledge must be an ascertained debt owed or promised, specified upon pledge or a
secured property.

Article 1453
In order that a pledge be considered completed and binding, the creditor or the third party holder must have
received it and the pledgee may, prior to delivering it, revoke the pledge

Article 1454
Should the pledgor be confronted with an impediment preventing him from financially disposing of the
thing pledged prior to taking possession thereof by the pledgee, the pledge contract is void.

Article 1455
The pledgor and the pledgee may agree to put the pledged thing in the hands of a third party holder, as if it
was in the pledgee’s hands and the pledge is completed upon receiving it.

Article 1456
1- The third party holder may not deliver the pledged thing to the pledgor or the pledgee without the
consent of the other as long as the debt exists and he may recover it if delivered by him.
2- If the pledged thing perishes prior to its restitution, the third party holder is liable for its value.

Article 1457
In case the third party holder dies and the pledgor and pledgee did not agree to deposit the pledged thing
with someone else, either of them may ask the court to order depositing it with a third party holder of its
choice.

Article 1458
The pledgor against a debt due by him or by others must own the thing pledged and have the capacity to
dispose thereof.

Article 1459
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The provisions governing the security mortgage, provided for in articles 1403 and 1404 shall apply to
pledge.

Article 1460
The provisions governing the security mortgage, provided for in article 1408 shall apply to the pledge of a
commonly held property.

Article 1461
If part of the commonly held property, or the like, is pledged the pledgee shall possess the entire property,
if the other part is the property of the pledgor, otherwise he shall take possession of the part pledged.

Article 1462
The provisions of Article 1410 of the present Law, concerning the indivisibility of the property mortgaged
as security for the debt, applies to pledge and the entire property remains to secure the whole debt or parts of
it.

Article 1463
The pledge includes all what is included in a sale of accessories attached to the thing pledged.

Article 1464
If the thing pledged, while in the hands of the purchaser, produce a distinct yield it shall follow as an
accessory of the pledge, if it is of the same kind, otherwise it shall not be considered part of the pledge unless
it is so specified in the pledge itself.

Article 1465
1- The thing pledged may secure more than one debt of the same rank provided it is pledged in one
contract.
2- The entire property shall be pledged with all creditors in consideration of the debt of each one of them.

Article 1466
1- Lent property may be pledged by authorization of its owner and according to his conditions.
2- The lender may not retrieve the pledged property before payment of the debt.

CHAPTER TWO

THE EFFECTS OF A PLEDGE

SECTION ONE

EFFECTS OF THE PLEDGE BETWEEN THE CONTRACTING PARTIES

AS CONCERNS THE PLEDGOR -1

Article 1467
1- The pledgor may not dispose of the thing pledged except with the consent of the pledgee.
2- If the act of disposal is a sale, the right of the pledgee shall be transferred to the price of the thing
pledged.

Article 1468

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1- If the pledgor acknowledges the thing pledged to a third party, his acknowledgment does not bind the
pledgee.
2- Such acknowledgment does not forfeit the right of the pledgee in retaining the thing pledged until he
receives the debt owed to him.

Article 1469
The pledgor warrants the safety of the thing pledged. He must not do anything that diminishes his warranty
or prevents the pledgee from exercising his rights.

Article 1470
The provisions of Article 1415 of the present Law, concerning the loss or deterioration of the mortgaged
property due to fault of the pledgor or to force majeure, apply to pledge.

Article 1471
Upon loss or deterioration of the thing pledged, the pledge is transferred to the thing that replaced it and
the pledgee may exercise his right on it in accordance with the provisions of Article 1416 of the present Law.
AS CONCERNS THE PLEDGEE -2

Article 1472
The pledgee must, in person or through his trustee, preserve the thing pledged and use for its preservation
the care of a reasonable man. He must answer for its loss or deterioration unless he can establish that they
were due to a cause not imputable to him.

Article 1473
The pledgee may neither dispose of the thing pledged without the permission of the pledgor nor sell it
unless he acts as an agent in the sale.

Article 1474
1- The pledgee may not profit from the thing pledged, movable or immovable, without the permission of
the pledgor.
2- The pledgor may allow the pledgee to benefit from the thing pledged provided that the revenue obtained
from the yields be applied, in the first place, in reduction of the expenditures paid by him on behalf of the
pledgor and of the principal amount of the debt thereafter.

Article 1475
The pledgee may reserve for himself, as a condition, the appropriation of the benefit derived from the
pledge, if such profit is determined in time or work, and deducted from the debt whether it be a debt derived
from a sale or loan. In case it is not used in reduction of the debt, the pledgee may not stipulate such
condition if the debt derives from a loan but it is allowed if derived from a sale with deferred payment of the
price, provided that it is so specified in the sale contract.

Article 1476
If the pledgee misuses the thing pledged, the pledgor is entitled to demand that the thing pledged be placed
in judicial custody

Article 1477
The pledgee may retain the thing pledged until he is paid the full debt owed to him together with all related
accessories and expenditures, after which he has to restitute the thing pledged to the pledgor.

Article 1478
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1- If the pledged thing perishes while in the possession of the pledgee, he shall warrant its value at the time
of taking possession thereof.
2- If the value of the pledge is equivalent to the value warranted by him, the debt shall be forfeited whether
the loss occurring is due to the wrongful act of the pledgee or not.
3- If the value is inferior to the debt, the pledgor shall be discharged of the debt and the pledgee shall be
liable for the balance, in case the loss is due to his wrongful act or negligence from his part in its
preservation.
4- If the value is inferior to the debt, the debt shall be discharged in proportion to this value and the
creditor is entitled claim the balance from the pledgor.

Article 1479
In accordance with article 1419 of this Law, the pledgee shall have the rights of the mortgagee in a security
mortgage as concerns execution on the thing pledged then on all the debtor’s assets, if he has not received
satisfaction of the full debt owed to him.

Article 1480
The provisions of Article 1420 of the present Law shall apply to pledge.

SECTION TWO

THE EFFECTS OF PLEDGE ON THIRD PARTIES

Article 1481
The thing pledged must be held by the pledgee or by the third party holder chosen by the parties to make
the pledge valid as against third parties.

Article 1482
The pledgee is entitled to retain the thing pledged until recovery of the full debt owed to him and its
accessories and expenses. If the pledgee unwillingly loses possession of the thing pledged, he has the right to
regain possession.

Article 1483
The thing pledged secures the principal amount of the debt as well as the necessary expenses paid by the
pledgee on behalf of the pledgor and the expenses of the pledge contract and its enforcement.

CHAPTER THREE

PROVISIONS CONCERNING CERTAIN KINDS OF PLEDGE

SECTION ONE

PLEDGE OF AN IMMOVABLE (ANTICHRESIS)

Article 1484
A pledge of an immovable is only valid as against third parties if, in addition to the possession by the
pledgee of the pledged immovable, the pledge is registered.

Article 1485
1- The pledgee creditor may lend or lease the pledged immovable to the pledgor provided it remains as a
security for the discharge of the debt and without affecting the validity of the pledge as against third parties.

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2- The provisions of Article 1474 of this Law on the yields of the pledged property shall apply to the lease
prepaid by the pledgor.

Article 1486
The pledgee creditor shall provide for the expenses necessary for the repair and maintenance of the
pledged immovable, the due taxes and charges and deduct the amount of all these expenses from the yields of
the pledged immovable or obtain repayment from the price thereof, upon selling it, according to the rank of
privilege of his debt.

SECTION TWO

PLEDGE OF A MOVABLE

Article 1487
A pledge of a movable is only valid against third parties if, in addition to the possession by the pledgee of
the pledged movable, it is inscribed in an instrument bearing a certified date setting out the amount of the
debt and the pledged property.

Article 1488
If the thing pledged appears to be in danger of perishing, deteriorating or diminishing in value, the pledgee
shall, in this respect, notify the pledgor and, in case the latter fails to provide another security, either one of
them are entitled to ask the court to sell the pledged thing and, thereupon, the right of the creditor is
transferred from the thing pledged to the price thereof.

Article 1489
If an advantageous occasion presents itself for the sale of the thing pledged, the pledgor may even before
the maturity of the debt, apply to the court for authority to sell the thing pledged. The Court, when
authorizing the sale, will fix the conditions and take a decision as to the deposit of the price.

Article 1490
The foregoing provisions shall apply to the extent they are not in contradiction with the commercial laws
and the special legislations compatible with the Islamic Shari’a.

SECTION THREE

PLEDGE OF DEBTS

Article 1491
Whoever pledges a debt due to him must deliver to the pledgee the instrument evidencing this debt.

Article 1492
1- A pledge is valid, as regards the debtor, only upon notification to or acceptance of by the debtor of the
pledge.
2- A pledge is only valid against third parties if the pledgee holds the title of the pledged debt.
3- The pledge shall be ranked in privilege as of the certified date of notification or acceptance.

Article 1493
Registered bonds or bonds payable to order may be pledged in accordance with the special procedure
prescribed by law for the transfer of such bonds, provided it is stated that the transfer is made by way of
pledge.

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Article 1494
A debt that cannot be assigned or attached cannot be pledged.

Article 1495
The pledgee has the right to collect the periodic dues and the related charges of the pledged debt and, in
this case he has to set off these amounts first against expenses then against the principal amount of the debt.

Article 1496
A pledgee is bound to look after the preservation of the pledged debt. If he has the right to collect any part
of the debt without the intervention of the pledgor, he is bound to collect it at the time and place fixed for
payment and forthwith inform the the pledgor thereof.

Article 1497
The debtor of a debt given in pledge may avail himself against the pledgee creditor of the defences relative
to the validity of the debt secured by the pledge as well as those defences that he may have against his own
original creditor, to the extent that the debtor, in case of assignment, may oppose these defences against the
assignee.

Article 1498
1- If a pledged debt falls due for payment before the actual debt secured by the pledge, the debtor must
discharge his debt to the pledgee and the pledgor jointly.
2-The pledgor and the pledgee have to agree on a third party holder in order to deposit the amount paid by
the debtor until maturity of the secured debt and the pledge shall be transferred to the amount deposited.

Article 1499
If both the pledged debt and the secured debt fall due, the pledgee who has not been paid may collect the
debt pledged up to the amount due to him and return the balance to the pledgor, if the amount due to him and
the secured debt are of the same kind, otherwise he may demand that the debt be sold or be appropriated to
him, against payment of its value, in satisfaction of his right.

Article 1500
The provisions governing the pledge of a movable are, to the extent they do not contradict the foregoing
provision, applicable to the pledge of a debt.

CHAPTER FOUR

EXTINGUISHMENT OF A PLEDGE

Article 1501
The right to a pledge is extinguished as a result of the extinguishment in full of the secured debt and is
revived with the debt if the cause of extinguishment of the debt disappears, without prejudice to the rights of
third parties in good faith legally acquired in the interval between the extinguishment of the debt and its
revival.

Article 1502
A right of pledge is also extinguished by one of the following causes:
a- The renunciation of the right by the pledgee explicitly or impliedly.
b-The union of the right of pledge and that of ownership of the thing pledged in one and the same person;
provided it is revived upon retrospective disappearance of this cause.
c- The loss of the thing pledged or the extinguishment of the right given in pledge.
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Article 1503
The pledge is not extinguished by the death of either the pledgor or the pledgee and will remain a pledge to
the heirs until discharge of the debt.

TITLE THREE

PRIVILEGED RIGHTS

CHAPTER ONE

GENERAL PROVISIONS

Article 1504
A privilege is a real accessory right of preference granted by law to the creditor enabling him to collect his
right by reason of its description.

Article 1505
1- In the absence of a law provision fixing the preferential rank of a privileged right it ranks after the rights
provided for in this Title.
2- Unless otherwise decided by law, privileged rights of the same rank will be paid pro rata to each other.

Article 1506
General privileges extend to the whole of the debtor’s property. Special privileges are limited to a specific
movable or immovable.

Article 1507
1-A privilege cannot affect the rights of a holder in good faith of a movable.
2-Shall be considered a holder within the context of the preceding clause, a lessor of an immovable, as
concerns furniture used in the leased premises, and a hotel proprietor, as concerns the effects brought into the
hotel by travelers.
3-If a privilege holder on a movable has reasonable grounds to apprehend its loss or misappropriation; he
may apply that it be placed under judicial custody.

Article 1508
1-Provisions governing the security mortgage are applicable to privileged rights over immovable property
in so far as they are not incompatible with the nature of these rights.
2-Privileges securing rights due to the Public Treasury as well as fees and expenses of judicial forced sales
are not subject to registration.

Article 1509
Provisions governing security mortgages relating to loss or deterioration of the thing mortgaged apply on
privileged rights.
In the absence of a law provision to the contrary, privileges are extinguished in the same way and in
accordance with the same rules as a security mortgage or a pledge.

CHAPTER TWO

KINDS OF PRIVILEGES
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SECTION ONE

GENERAL RULE

Article 1511
In addition to the privileges established by special law provisions, the rights enumerated in the following
provisions are privileged in their respective ranks of preference and shall be payable on pro rata basis
between them.

SECTION TWO

GENERAL PRIVILEGES AND SPECIAL PRIVILEGES OVER MOVABLES

Article 1512
1-Expenses of legal proceedings incurred, in the common interest of the creditors, for the preservation and
sale of the property of the debtor, have a privilege over the price of such property.
2-Such expenses are payable in priority to any other right, whether privileged or secured by a security
mortgage, including rights of creditors for whose benefit such expenses have been incurred. Expenses
incurred for the sale of the property are payable in priority to the costs of the procedure of distribution.

Article 1513
1-Sums due to the government for taxes, duties and other dues of any kind are privileged in accordance
with the conditions laid down by laws issued in this respect.
2-Such sums shall be paid out of the proceeds of sale of the property charged with the privilege, in
whosoever’s hands it may be, and before any other right, whether privileged or secured by a mortgage,
except costs of legal proceedings.

Article 1514
Costs incurred for the preservation or repair of the movable have a privilege over it and will be paid out of
its price after the judicial expenses and sums due to the Public Treasury.

Article 1515
1-The following rights are secured b a privilege over all the debtor’s property, whether movable or
immovable, to the extent of what is due of these rights during the last six months:
a-Alimony due by the debtor to persons he is in charge of.
b- Sums due for foodstuffs clothes and medicines supplied to the debtor and to persons depending on him.
2-These sums are payable immediately after the judicial expenses, amounts due to the Public Treasury and
expenses for preservation and repairs. As between them these sums will be paid pro rata.

Article 1516
1-Sums disbursed for seeds, manure and other fertilizers and insecticides, and sums disbursed for
cultivation and harvesting are secured by a privilege over the crop for whose production they are spent They
will all have the same rank and are payable out of the proceeds of sale of the crop, immediately after the
preceding rights, if any.
2-Prices of agricultural machines and expenses for their repair are secured by a privilege over such prices
and shall have the same rank.

Article 1517
Real estates and agricultural rents for two years, or for the duration of the lease if less than two years, and
all rights to the lessor by virtue of the lease contract are secured by a privilege over all attachable movables
and crops existing on the leased premises and belonging to the lessee.
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Article 1518
Subject to the provisions relating to stolen or lost property, the rent privilege referred to in the preceding
article is enforceable even when the movables belong to the wife of the lessee or to a third party whose right
is not known to the lessor.

Article 1519
1- Privilege over the lease debt is enforceable on movables and crops existing in the leased property even if
they belong to the sub-lessee, in case the lessor did not authorize the principal lessee to sub-let the leased
premises to others.
2- If the lessor authorized the lessee to sub-let the leased premises to others, the privilege will only be
enforceable up to the amount due by the sub-lessee to the principal lessee.

Article 1520
Subject to rights acquired by third parties in good faith, the lessor has an indefeasible right to follow the
property charged with a privilege if they are removed from the leased premises notwithstanding the objection
of the lessor or without his knowledge and the movables remaining on the property are not sufficient to
secure the privileged rights. The privilege shall remain in force on the property so removed for three years
from the date of removal, even to the detriment of a third party’s right, if the lessor effects within thirty days
from the date of removal an attachment on these movables. If, however, these movables are sold to a
purchaser in good faith in a public market or by public auction or by a merchant dealing in similar articles,
the lessor must reimburse the purchaser with the price.

Article 1521
Lease debts over real estates and agricultural lands are paid out of the price of the property charged with a
privilege after the rights stated in the preceding articles, with the exception of the rights which are not
enforceable as against the lessor who is considered a holder in good faith.

Article 1522
1- Sums due to hotel proprietors by a traveler for accommodation, food and expenses incurred for his
account, are secured by a privilege over the effects brought by the traveler to the hotel.
2- Unless established by the traveler that the hotel proprietor knew of the existence of a third party’s rights
over these effects at the time they were brought on to the premises, this privilege may be enforced on these
effects, even if they do not belong to the traveler, provided that they are not lost or stolen property. The hotel
proprietor may object to the removal of these effects, as long as he has not been paid in full, and if they are
removed notwithstanding his objection or without his knowledge, the privilege continues to be enforceable
on them, subject to the rights acquired by third parties in good faith on these effects.

Article 1523
An hotel proprietor’s privilege has the same rank as a lessor’s privilege Should both rights be claimed on
these effects, the first in date will have priority, unless it is not enforceable on the other.

Article 1524
1- The vendor of a movable has a privilege over the price of the thing sold and its accessories. This
privilege is enforceable as long as the movable sold preserves its identity, without prejudice to the rights
acquired in good faith by third parties, and subject to the special provisions applicable in commercial matters.
2- This privilege follows in rank privileges over movables referred to above. It operates as against the
lessor and the hotel proprietor if it can be proved that they had knowledge of such privilege at the time the
thing sold was brought onto the leased property or in the hotel.

Article 1525
1- Co-owners who have partitioned a movable have a privilege over it as concerns the right of each one of
them to have, as a result of the partition, a claim against the others, and to payment of what has been allotted
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to him.
2-The privilege of a co-partitioner has the same rank as a vendor’s privilege, the first in date will have
priority.

SECTION THREE

SPECIAL PRIVILEGES OVER IMMOVABLE PROPERTY

Article 1526
1- The price and accessories due to the vendor of an immovable are secured by a privilege over the
immovable sold.
2- Such privilege must be registered, notwithstanding the transcription of the sale, and its rank is fixed by
the date of its registration.

Article 1527
1- Sums due to contractors and architects who have been entrusted with the erection, reconstruction, repair
or maintenance of buildings or other works, have a privilege over such works but only in respect of the
increase in value resulting from such works at the time of the alienation of the immovable.
2- Such privilege must be registered, and its rank is fixed by the date of its registration.

Article 1528
1- Co-owners who have partitioned an immovable have a privilege over it in respect of their respective
remedies against each other resulting from the partition, including their right to claim payment of any
difference reverting to them in the partition.
2- Such privilege must be registered, and its rank is fixed by the date of its registration.

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