Civil Transactions Law (contracts dated before 1 June 2026) · Federal Law 5 of 1985
Article 265
Section 4: The construction of contracts
This law is repealed. The article applies to contracts dated before 1 June 2026; later contracts fall under the 2025 Civil Transactions Law.
English translation
(1) If the wording of a contract is clear, it may not be departed from by way of interpretation to ascertain the intention of the parties.
(2) If there is scope for an interpretative construction of the contract, an enquiry shall be made into the mutual intentions of the parties beyond the literal meaning of the words, and guidance may be sought in so doing from the nature of the transaction, and the trust and confidence which should exist between the parties in accordance with the custom current in (such) dealings.
Official translation, as published by the portal.
Official Arabic text
1 - إذا كانت عبارة العقد واضحة فلا يجوز الانحراف عنها عن طريق تفسيرها للتعرف على إرادة المتعاقدين. 2 - أما إذا كان هناك محل لتفسير العقد فيجب البحث عن النية المشتركة للمتعاقدين دون الوقوف عند المعنى الحرفي للألفاظ مع الاستهداء في ذلك بطبيعة التعامل وبما ينبغي أن يتوافر من أمانة وثقة بين المتعاقدين وفقًا للعرف الجاري في المعاملات.
What it means when you sign
This article sets out how a contract is interpreted. If the wording of a contract is clear, it cannot be set aside by interpreting it to find out what the parties intended. Only where there is room for interpretation does the inquiry go further: the aim is then to find the common intention of the parties, not to stop at the literal meaning of the words. In doing so, guidance may be taken from the nature of the transaction and from the trust and confidence that should exist between the parties according to the custom in such dealings.
When you are about to sign a contract, this article means that clear wording will generally be taken as written, so what a clause plainly says matters more than what the parties may have had in mind. Where a clause is vague or can be read in more than one way, the common intention, the type of deal and customary practice come into play. Ambiguous clauses, undefined terms and wording that differs from what was discussed are therefore the places to look, since clear text will carry its plain meaning.
In Fahm reports this article usually sits under: Ambiguity and gaps
Related articles
- Article 264This article is a single short rule: what is known and accepted as the custom between merchants is treated as if it had been stated as a condition between them.
- Article 266Cited in Fahm reportsThis article has two parts.
- Article 106Cited in Fahm reportsThis article says that a person who uses a right in an unlawful way is held liable for it.
- Article 295This article is about how compensation for a harmful act is set.
- Article 296Cited in Fahm reportsThis article makes void any condition that aims to exempt a person from liability arising from a harmful act.
- Article 297This article explains the relationship between civil liability and criminal liability.