Assignment of Rights in the United Arab Emirates

Analysis

Following the previous article entitled “Assignments in the United Arab Emirates” (published in the November issue of the Law Update) explaining the general conditions and requirements of a valid assignment in the UAE, this article oulines the prevailing jurisprudence with respect to assignment of rights in the UAE.

Given the absence of a separate legal regime for an assignment of rights under UAE law, UAE Courts have decided cases on assignment of rights based on existing commercial common practices and comparative law. In the following Dubai Court of Cassation case, the Courts are guided by the provisions of the UAE Civil Code relating to ‘assignment of debts / obligations' in determining the validity of an ‘assignment of right'.

Dubai Court of Cassation Case No. 188/2006

Issued on 13th March 2007

Claim

A civil action was filed before the Dubai Court of First Instance by a commercial bank (the “Bank”) against a corporate borrower (the “Borrower”) for non-payment of the latter's obligations under a term loan facility.

Facts of the Case