Under UAE law, the statute of limitations for a claim to terminate a sales contract varies depending on the nature of the contract and the type of claim associated with it. Generally, the statute of limitations is determined in accordance with the provisions of the UAE Civil Code.
In contracts binding on the contracting parties, if a reason arises for terminating the contract or if it is proven to be invalid or corrupt, the aggrieved party has the right to demand that the other party terminate the contract by mutual consent and agreement, or by filing a lawsuit to terminate the sale contract, which is considered a right guaranteed by law to the party harmed by the continuation of the contract.
However, exercising this right is subject to an important condition, which is that it must be used within a specific period of time, after which the claim to annul the sale contract will lapse due to the statute of limitations, for the most important reasons:
- The plaintiff’s negligence and failure to file a lawsuit by his beneficiary, unless he has a legitimate excuse that is accepted by the court.
- Preventing the accumulation of cases and claims in courts in time and space.
- The stability of civil legal transactions, whose disputes cannot continue for life and be inherited.
Statute of limitations for a lawsuit to annul a sales contract
The statute of limitations for a claim to terminate a contract in the UAE Civil Code varies according to the type of sale, as follows:
- If the quantity of the sold item is specified in the contract, and there appears to be a shortage or surplus in kind or money, and there is no agreement or custom regarding this, the buyer’s right to file a lawsuit to annul, reduce the price, or complete the contract shall lapse after one year has passed since the delivery of the sold item.
- The right to file a claim for termination of the contract arising from a harmful act shall lapse after the lapse of three years from the day on which the injured party became aware of the occurrence of the harm and of the person responsible for it.
and If the termination is based on a breach by one party of the terms of the contract (such as failure to pay the price or failure to deliver the sold item), the claim follows the general rules of limitation (15 years), unless the contract stipulates a shorter period.
- The right to file a lawsuit to annul the contract for its invalidity because it is illegal in its origin and description shall lapse after fifteen years have passed from the time of concluding the contract.
- If the annulment is based on a defect in the sale (hidden defect claim), Article 544 states:
The Civil Code stipulates that the buyer must notify the seller of the defect within a reasonable time of its discovery, and if he does not notify him within the specified period, the claim may be dropped.
The statute of limitations that prevents a claim from being heard is calculated in days, excluding the first day. It ends at the end of the last day, unless it is an official holiday, in which case it extends to the following day. The statute of limitations is suspended whenever there is an external legal impediment that prevents a claim for rescission. The period of excuse is not included in the statute of limitations.
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conclusion
It can be argued that revoking a preliminary sales contract in the UAE depends largely on the terms of the contract itself, the nature of the agreement between the parties, and the laws regulating this type of contract. Adherence to the terms of the contract is usually the basis, but there are situations that permit withdrawal pursuant to the law or by prior agreement, particularly if there are unforeseen circumstances or a breach by one party.
To ensure you make the right decision and avoid any legal or financial consequences, it is always advisable to carefully review the contract and consult a qualified attorney for legal guidance tailored to your situation.
