Contracts and obligations · Legal glossary
RescissionIn Arabic: فسخ العقد
Definition
Rescission ends the contract at the request of one party because the other failed to perform. It is ordered by the court, or it follows an express termination clause, with damages where they are due.
How it varies across the GCC
In Saudi Arabia rescission is sought after a formal notice of default, and the court may refuse it if the breach is of little importance (Civil Transactions Law, article 107). An express termination clause does not dispense with that notice unless the parties clearly agree that it does (article 108). Rescission has no retroactive effect in contracts performed over time (article 111).
The rules that apply to a specific matter depend on the state, any free zone involved and the current text of the law, so check the official source before relying on them.
Sources
Official texts for the points on this page. General information, not legal advice. An article number is cited only where it was verified.
- Saudi Civil Transactions Law, art. 107, 108, 111https://laws.boe.gov.sa/BoeLaws/Laws/LawDetails/655fdb42-8c96-422b-b8c4-b04f0095c94c/1