Federal Law No. (5) of 1985 on Civil Transactions outlines several scenarios in which parties may terminate a sale contract, one of which is “impossibility of performance.”
In this article, we will discuss the contract termination Due to impossibility of performance in the UAE, the legal procedures required to file a lawsuit for such termination, and the conditions under which such a lawsuit can be initiated.
Feel free to contact us now to consult with an attorney on this subject.
Understanding a Lawsuit for Terminating a Sale Contract Due to Impossibility of Performance
A lawsuit for terminating a sale contract due to impossibility of performance under UAE law is a legal action that can be initiated when fulfilling the terms of the contract becomes impossible due to circumstances beyond the control of both parties, rendering further obligations under the contract unfeasible.
Conditions for Filing a Lawsuit to Terminate a Sale Contract Due to Impossibility of Performance in the UAE
- Existence of a Valid and Complete Contract:
The contract must meet all the formalities and conditions for a valid agreement under the law. - Absolute, Not Relative, Impossibility of Performance:
The performance of the agreed-upon obligation in the contract must be absolutely impossible, not merely difficult. Relative impossibility does not satisfy the conditions required for initiating this lawsuit. - No Fault by the Claimant:
The claimant must not have contributed, either directly or indirectly, to the impossibility of performance. If the impossibility arises due to the claimant’s actions, they lose the right to file the lawsuit and may instead be held liable for compensating the other party. - Unforeseen Event:
The event causing the impossibility of performance must be entirely unforeseen at the time the contract was executed. If there were any indications or likelihood of the event occurring, the claimant loses the right to file the lawsuit. In summary, the event must be wholly unexpected and without any prior predictions.
For further information, refer to: Cases and Conditions for Contract Termination in UAE Law.
Procedures for Filing a Lawsuit to Terminate a Sale Contract Due to Impossibility of Performance in Dubai
Before filing a lawsuit, you must be aware of the legal procedures and steps to follow. UAE Civil Procedure Law provides for the following process:
- Drafting the Statement of Claim:
The claim must include the court’s jurisdiction, case details, facts, and the specific relief sought. - Filing and Registering the Claim:
Submit the claim to the competent court and complete the registration process. - Attachments:
Include all required supporting documents with the claim, such as the contract, evidence of impossibility, and relevant correspondence. - Payment of Court Fees:
Pay the legal fees as prescribed by law. - Submission of Evidence:
Present compelling evidence proving the impossibility of performance, supported by legal and factual documentation. - First Hearing Notification:
The court schedules the first hearing and notifies the defendant accordingly. - Trial Proceedings:
At the hearing, the court examines evidence, hears the parties’ arguments, and allows both sides to submit legal briefs. - Appeal Process:
If either party is dissatisfied with the court’s ruling, they may appeal the decision to the civil appellate court. - Enforcement of Final Judgment:
Once the judgment becomes final, it can be enforced through the Civil Execution Department to implement its provisions.
Sample Statement of Claim for Terminating a Sale Contract Due to Impossibility of Performance
Disclaimer: The following is a general template for informational purposes only. It does not constitute legal advice, and we hold no liability for its use.
To the Respected Dubai Court of First Instance,
Subject: Lawsuit for Terminating a Sale Contract Due to Impossibility of Performance
Claimant:
Name: …………
Nationality: …………
UAE ID No.: …………
Address: …………
Represented by: ………… (Law Firm Name, Registration Number, Contact Details)
Defendant:
Name: …………
Nationality: …………
UAE ID No.: …………
Address: …………
Represented by: ………… (Law Firm Name, Registration Number, Contact Details)
Facts:
- On [Date], the claimant and defendant entered into a preliminary sale contract for property [Property Number], located at [Location], for an agreed price of [Amount] AED.
- The defendant agreed to deliver the property in the agreed-upon condition no later than [Date].
- Upon the delivery date, it became evident that the property had suffered significant damage due to a fire, rendering it unusable.
- Despite multiple notifications, the defendant failed to address or resolve the situation.
Legal Basis:
Under Article 273 of the UAE Civil Transactions Law: “In bilateral contracts, if a force majeure event renders the performance of obligations impossible, the reciprocal obligation is also extinguished, and the contract is considered terminated automatically.”
Requests:
The claimant respectfully requests the court to:
- Terminate the sale contract dated [Date] between the claimant and defendant.
- Order the defendant to refund [Amount] AED paid by the claimant.
- Award the claimant [Amount] AED in compensation for material and moral damages.
- Order the defendant to bear all legal costs, fees, and attorney’s expenses.
Claimant’s Attorney:
Name: …………
Signature: …………
Date: …………
Attachments:
- Copy of the sale contract
- Proof of payment
- Correspondence between the parties
- Evidence of the event causing impossibility (e.g., fire reports)
Legal Implications of Terminating a Contract
According to Article 274 of the Civil Transactions Law, the consequences of a termination judgment are:
- Restoring the parties to their pre-contractual positions, wherever possible.
- Awarding compensation if restoration is not feasible.
Consult a Lawyer for Professional Guidance
Terminating a sale contract due to impossibility of performance is a complex legal matter requiring substantial evidence. We recommend consulting a specialized lawyer in Dubai to ensure your case is handled effectively.
Our legal team is experienced in litigation before UAE courts at all levels. Contact us now for tailored legal advice.
References:
- UAE Civil Transactions Law (1985)
- Official publications from UAE judicial authorities
Legal expert specializing in commercial companies laws, with over 15 years of experience in drafting commercial contracts and advising startups and large corporations.