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Liquidated Damages / Penalty Clause

الشرط الجزائي

corporate commercial

A penalty clause (liquidated damages clause) fixes in advance the compensation payable for a breach — most familiar as delay damages in construction contracts, often expressed per day or week of late completion. The crucial UAE feature is judicial control: unlike some common law systems, UAE law lets the court adjust the agreed amount to match the actual harm — reducing it if the creditor suffered less, or where the obligation was partly performed — and an aggrieved party may seek more than the clause if it proves greater loss caused by the debtor's fraud or gross fault. The clause therefore sets a strong starting presumption, not an untouchable number. It also spares the claimant from proving the precise amount of loss, which is its practical power. It matters in every delayed project and missed deadline. You meet it in construction and fit-out contracts, supply and service agreements, and employment-related commitments such as training-cost clauses.

Also in

الشرط الجزائي اتفاق مسبق على مقدار التعويض المستحق عند الإخلال — وأشهر صوره غرامات التأخير في عقود المقاولات محسوبة باليوم أو الأسبوع عن التأخر في الإنجاز. والسمة الإماراتية الجوهرية هي الرقابة القضائية: فبخلاف بعض الأنظمة الأنجلوسكسونية، يجيز القانون الإماراتي للمحكمة تعديل المبلغ المتفق عليه ليطابق الضرر الفعلي — بإنقاصه إن كان الضرر أقل أو نُفذ الالتزام جزئياً — كما يجوز للمضرور طلب ما يجاوز الشرط إذا أثبت ضرراً أكبر نشأ عن غش المدين أو خطئه الجسيم. فالشرط يقيم قرينة قوية لا رقماً مقدساً، ويعفي المطالب من إثبات مقدار الضرر بدقة وهنا قوته العملية. تواجهه في عقود المقاولات والتجهيز والتوريد والخدمات وبعض التزامات العمل كشروط تكاليف التدريب.

Plain-language summary for information only. Not legal advice. Consult a licensed UAE advocate for your specific case.

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