UAE Laws and Islamic Finance

Laws of the UAE and Islamic Finance

Archive for December 14, 2010

Indirect Lawsuit and Third Party Attachment in the UAE

 

 

 

UAE Federal Law No. 5 of 1985  The Civil Transactions Law

Holding Properties of a Debtor As Security for Settlement

Article 391:

  1. All of a debtor’s properties shall be held as security for settlement of his debts.
  2. All creditors are equal with respect to such security; without prejudice to any provisions in the law to the contrary.

 

Indirect Lawsuit

Article 392:

  1. Every creditor, notwithstanding that his right is not mature for settlement, shall in the name of his debtor, exercise all the debtor’s rights except those which are considered personal or not subject for attachment.
  2. A creditor shall not exercise the rights of his debtor unless he proves that the debtor has not exercised such rights and that his negligence may lead to his bankruptcy or complication of his bankruptcy, and the debtor must become party to the lawsuit.

 

Article 393:

A creditor shall be considered a representative for his debtor in exercising his rights and every benefit arising from the exercise of such rights shall be included in the debtor’s properties and shall be considered as security for all of his creditors.

UAE Laws and Islamic Finance

Laws of the UAE and Islamic Finance