Tag: Case and Fatwa Summary

The Supreme Court ruled that a training contract coupled with employment automatically transforms into a binding employment contract upon the trainee's successful completion of the training. The employer is obligated to pay wages from that point and cannot rely on secondary clauses to evade the primary obligation of hiring the trainee.

In application of article 165 of the Civil Transactions Law, the Supreme Court held that contract clauses that are explicitly clear regarding the obligations of the parties in a development agreement cannot be reinterpreted.

The Ministry of Justice and Legal Affairs (MJLA) held that the Oman Housing Bank, a government-owned enterprise under the Oman Investment Authority, is exempt from value added tax (VAT).

The Supreme Court held that filing a lawsuit to request an interim measure—such as appointing an expert to document construction works—does not amount to a waiver of a contractual arbitration clause, in line with articles 9 and 14 of the Law of Arbitration in Civil and Commercial Disputes.

The Ministry of Justice and Legal Affairs (MJLA) confirmed the right of the employer under the Standard Contract for the Construction of Buildings and Civil Works to replace a contractor with another if the first contractor goes bankrupt in accordance with article 63-1 of the Standard Contract. The MJLA noted that the exercise of this right can be restricted by the provisions of article 59 of the Civil Transactions Law, but determined that none of the cases of article 59 applied in this case.

The Supreme Court ruled that while contractors and engineers are liable for structural defects for ten years, a lawsuit claiming damages for such defects must be filed within three years of discovering the defect. Failure to file within this three-year period results in the dismissal of the claim due to the statute of limitations.

The Ministry of Justice and Legal Affairs (MJLA) deemed that the allocation of a government building to a government entity does not automatically make that government entity a party to a construction contract relating to that building when another government entity has been explicitly assigned the obligations relating to this contract by royal decree.

The Ministry of Justice and Legal Affairs (MJLA) adopted a literal interpretation of article 52-3 of the Standard Contract for the Construction of Buildings and Civil Works, Fourth Edition 1999 stipulating that the contractor is entitled to a revision of the contract value if the cumulative value of the variation orders exceeds 10% of the original contract value.

The Supreme Court held that a legal person can only be convicted of a crime committed by its employees if the judgment establishes the conditions laid down in the Penal Law and the Cybercrime Law of 2011, namely that the crime was committed for its account or in its name by a person acting in a managerial or representative capacity, or with its approval, cover-up, or gross negligence. A finding that the employee held a senior position and that the company's controls were weak is not enough. The court also confirmed that obedience to a superior is no defence to a criminal charge: a subordinate is not required to obey an order to commit an act that she knows the law punishes.

The Supreme Court held that a dispute resolution clause in the articles of association of a company designating Omani courts as the competent authority for disputes between two partners supersedes an arbitration clause in a prior joint venture agreement between the same partners, as the later contract reflects the final will of the parties and revokes conflicting terms in the earlier agreement.