The recent changes to the UAE Civil Transactions Law (Federal Decree Law No. 25 of 2025) provisions governing contracts of sale mark a deliberate legislative effort to modernise commercial dealings, enhance transactional certainty, and strengthen protections for both contracting parties and third parties. The revised framework refines several long-standing doctrines, particularly sale by sample, latent defects, sales involving persons with limited legal capacity, transactions during terminal illness, and the sale of litigious rights by clarifying evidentiary standards, expanding remedies, and introducing targeted safeguards against abuse. Collectively, these changes reflect a policy shift towards balancing contractual freedom with fairness, transparency, and judicial integrity.
1. Sale by Sample and Model
The law regulates sales that are concluded based on a sample or model. It provides that where a sale is made by reference to a sample, the goods delivered must match that sample. If the goods do not conform, the buyer is entitled to choose either to accept them or reject them. In simple terms, the sample becomes the standard against which the goods are legally judged.
The law also addresses how disputes about conformity are to be resolved. If both the sample and the delivered goods still exist, the issue must be determined by experts rather than by the parties’ statements alone. In such cases, the expert’s role is to assess technically whether the goods correspond to the sample in terms of quality, specifications, and characteristics. This ensures that disagreements are decided objectively based on professional evaluation, which is particularly important where conformity cannot be determined without specialised knowledge.
If the sample has been lost, perished, or damaged, the law sets out rules on whose statement will be relied upon, unless the opposing party proves otherwise. This depends on who had possession of the sample and whether the goods were specifically identified in the contract or only described by type. Where the sample was kept by a mutually agreed third party and is later lost or destroyed, the allocation of proof depends on how the goods were defined in the agreement. If the contract clearly identified the specific goods as the agreed subject of the sale, the seller’s statement regarding conformity will prevail unless the buyer proves otherwise. However, if the goods were described only by type or general designation rather than as specifically agreed items, the buyer’s statement regarding discrepancy will prevail unless the seller proves the contrary.
These distinctions are intended to prevent evidentiary deadlock when the original sample is no longer available and to allocate the burden of proof in a predictable manner. The more precisely the goods are identified in the contract, the stronger the seller’s position in a dispute; the more general the description, the more protection the buyer receives.
Practical interpretation:
In commercial practice, these rules mean that parties should carefully document and preserve samples used during negotiations, as they may later become decisive evidence. Businesses relying on samples, such as in manufacturing, supply, or trading contracts, should also ensure that contracts clearly describe whether the sample is binding or illustrative. From a dispute perspective, the amendments provide clearer guidance on proof and reduce uncertainty about how courts or tribunals will assess conformity.
2. Protection of Sellers with Limited Legal Capacity
The new law deals with situations where a person who does not have full legal capacity (for example, a minor or someone with restricted legal capacity) sells real estate for a price that is significantly lower than its true value. In such cases, the law allows the seller to request that the price be increased so that it matches the fair market value of the property. The value is assessed based on the property’s market price at the time the sale took place.
The law also sets a time limit for making this claim. A request to increase the price must be filed within three years from the date the seller gains full legal capacity or, if the seller dies, within three years from the date of death. After this period, the claim will no longer be accepted.
Importantly, the law protects third parties who acted in good faith. If someone else has already acquired a real right over the property (for example, a new owner or mortgage holder), that right will not be affected, provided it was acquired in good faith.
Practical interpretation:
In practice, this means that buyers dealing with sellers who may have limited legal capacity must ensure that the sale price reflects the real market value and that proper legal authority exists. Otherwise, the transaction may later be challenged. At the same time, third parties who acquire rights over the property in good faith are protected, which helps maintain stability in real estate transactions.
3. Latent Defects: Expanded Remedies and Extended Limitation Period
The updated provisions on latent defects (Articles 493-495) represent one of the most commercially significant reforms. A defect is now expressly defined as latent if it existed prior to sale or arose before delivery and could not reasonably be discovered without expertise or testing.
Most notably, the buyer’s remedies have been expanded. Instead of the traditional binary choice between rescission and acceptance at the contract price, the buyer may now retain the goods and claim a proportional price reduction reflecting diminished value. The seller, in turn, may avoid liability by providing a defect-free substitute of equivalent quality. This introduces flexibility and encourages commercial solutions rather than immediate litigation.
The extension of the limitation period for latent defect claims from six months to one year from delivery, unless a longer warranty is agreed, further strengthens buyer protection. This change acknowledges that certain defects only manifest after prolonged use and ensures that legal remedies remain available within a realistic timeframe (Article 510). The seller may not invoke this period if it is proven that the concealment of the defect was due to fraud on his part.
4. Sales During Terminal Illness
The law deals with sales made by a person who is seriously ill and close to death. The law defines this situation as an illness in which the person can no longer carry out normal activities and where death is likely. It also treats situations of imminent danger (even without illness) in the same way.
Under these provisions, a sale made during such a period may be questioned if it appears that the seller transferred property for less than its true value and the transaction affects the rights of heirs or creditors. For example, if property is sold at a price significantly below market value, heirs or creditors may challenge the sale unless certain conditions are met, such as the buyer paying a higher price to match the property’s value.
The law no longer relies on a fixed time period before death to determine whether these rules apply. Instead, the court will assess the circumstances of each case to decide whether the person was in a “death-illness” situation at the time of the transaction.
The provisions also protect third parties who acted in good faith. If the buyer has already transferred the property to someone else who acquired rights over it for value and without knowledge of the issue, the sale cannot be undone, although financial compensation may still be claimed.
Practical interpretation:
In practice, these rules are meant to prevent individuals from transferring assets shortly before death in a way that unfairly disadvantages heirs or creditors. Buyers entering into transactions with seriously ill sellers should ensure that the price reflects market value and that the transaction is properly documented. Otherwise, the sale could later be challenged even if it appeared valid at the time.
5. Sale of Litigious Rights
The law regulates the sale of rights that are already the subject of a dispute or court case. A right is considered “litigious” if legal proceedings have started or if there is a serious dispute about it. The law allows such rights to be sold, but it gives protection to the opposing party in the dispute. Specifically, the opposing party may take over the right from the buyer within sixty days of becoming aware of the sale, provided they reimburse the buyer for the price paid and any related expenses.
The law also prohibits certain persons from purchasing disputed rights. Judges, prosecutors, court employees, arbitrators, mediators, and similar officials cannot buy such rights if the dispute falls within their professional role. Lawyers are also prohibited from purchasing rights involved in cases they are handling for clients. If any of these persons enter into such a transaction, the sale will be considered void.
Practical interpretation:
These provisions aim to prevent conflicts of interest and ensure judicial integrity. In practice, they make it clear that disputed claims cannot be traded freely where doing so could create unfair advantage or undermine confidence in legal proceedings. Parties considering buying a disputed claim should first confirm that no legal restrictions apply and that none of the prohibited persons are involved in the transaction.
Conclusion
From a transactional perspective, the reforms encourage more precise drafting of sale agreements, particularly where goods are defined by sample or where quality specifications are critical. Parties must also pay closer attention to documentation, valuation, and disclosure practices, as evidentiary presumptions now play a decisive role in disputes.
For legal practitioners, the amendments provide clearer statutory tools for advancing or defending claims. Expanded remedies for latent defects, defined evidentiary rules, and express limitations periods will likely reduce interpretive uncertainty and narrow the scope of judicial discretion. At the same time, the new provisions governing litigious rights introduce compliance considerations that extend beyond contract law into professional ethics and regulatory obligations.
These amendments have direct practical effects for businesses entering into sale transactions. Contracts should now be drafted more carefully, especially where goods are described by reference to samples, models, or technical specifications. Parties should also ensure that documents such as valuation reports, inspection records, and correspondence are properly maintained, as these may become important evidence if a dispute arises.
The New Civil Code provisions governing sales signal a deliberate legislative move towards a more sophisticated and commercially responsive legal framework. By clarifying standards of conformity, strengthening protections for vulnerable parties, expanding remedies for defects, and safeguarding judicial integrity, the law enhances both transactional reliability and dispute resolution efficiency. For businesses, legal advisers, and courts alike, these reforms represent not merely technical amendments but a substantive evolution in the UAE’s approach to regulating contractual relations.
