The Libyan Civil Code

Article 172 Definition

Article 183 Prescription Articles 184- 190 1. Payment Not Due. Articles 191 - 200 2. Voluntary Agency. 4 (Chapter 1 continued) Section V THE LAW

Article 201 Obligations Arising Directly from the Law Chapter II The Effects of Obligations Articles 202 20 Section I SPECIFIC PERFORMANCE Articles 206 217 Section 1I COMPENSATION IN LIEU OF PERFORMANCE Articles 218 - 236 Section 111 MEANS OF REALISING AND SECURING THE RIGHTS OF CREDITORS 1. Means of Realising the Rights of Creditors. Articles 232- 248 2. One of the Means of Security: the Right of Retention. Anicles 249- 251 Chapter IIІ Kinds of Conditions Modifying the Effects of Obligations Section I CONDITIONAL OBLIGATIONS AND TIME CLAUSES 1. Conditional Obligations. Articles 252- 257 2. Time Clauses. Articles 258 261- Section II PLURALITY OF OBJECTS OF AN OBLIGATION 1. Alternative Obligations. Articles 262- 264 2. Facultative Obligations. Article 265 Section III PLURALITY OF PARTIES TO AN OBLIGATION 1. Joint and Several Obligations. Articles 266- 286 2. Indivisibility. Articles 287- 289 Chapter IV Transmission of an Obligation Section I THE ASSIGNMENT OF A RIGHT Articles 290 - 301 Section II ASSIGNMENT OF A DEBT Articles 302 - 30В Chapter V The Extinction of Obligations Section 1 PAY MENT 1. The Two Parties to Payment. Articles 310-327 2. Means of Payment. Articles 328-336 Section I1 METHODS OF EXTINCTION OF AN OBLIGATION EQUIVALENT TO PERFORMANCE 1. Glving in Payment. Articles 337- 338 2. Novation and Delegation. Articles 339- 348 3. Compensation (Set Off). Articles 349- 356 4. Merger. Article 357 5 (Chapter V continued) Section III THE EXTINCTION OF OBLIGATION S WITHOUT PAYMENT 1. Release of the Obligation. Armcles 3as я3р 2. Impossibility of Performance. Artcle Yu 3. Extinctive Prescription. Anices 861 3:a Chapter VI Proof of Obligations PROOF OF OBLIGATIONS AND RELEASE

Article 6 Section I Documentary Evidence. Articles 3?- d Section II Evidence by Witnesses. Articles EN? - Section !II Presumptions. Articles RD HS Section IV Admissions. Articles яд- Section V Oaths. Articles 39 diln BOOK TWO SPECIFIC CONTRACTS Chapter I Contracts as regards Ownership Section I SALE 1. Sale in General. Articles 407 - 4áя 2. Different Forms of Sale. Artioles 484 - 470 Section II EXCHANGE Articles 471- 47N Section III GIFTS 1. Elements of a Gift. Anicles 478-4R1 2. The Effects of a Gift. Articles 488HA 3. Revocation of Gifts. Artioles 4RA PHя Section IV PARTNERSHIP Aticles PBP RP 1. Elements of the Contract of Partnership. Articles 497 80ь 2. The Management of Partnership. Aricles S0x A1Я 3. The Effects of Partnership. Articles äl4 a 4. Dissolution of Partnership. Articles 5 A 5. Termination of Partnership Relations in Respect of One Partner Only. Articles ada haa 6. Liquídation and Partition of the Partnership Property. Articles 890 - 50 6 (Chapter 1 continued) Section V LOANS AND ANNUITIES Articles 537 543 Loans for Consumption. - 1. Articles 544 547 Annuities. - 2. Section VI COMPROMISE Articles 548 551 Elements of Compromise. - 1. Articles 552- 554 2. The Effects of Compromise. Articles 555-556 3. Nullity of Compromise. Chapter II Contracts relating to the Use of a Thing Section I LEASES 1. Leases Generally Elements of a Lease. Articles 557 562 Effects of a Lease. Articles 563 591 Articles 592- 596 Assignment of a Lease and Sub-Lease End of a Contract of Lease. Articles 597- 599 Death or Insolvency of the Leasee. Articles 600 608 2. Certain Kinds of Leases: Leases of Agricultural Land. Articles 609 - 617 Amodiation. Articles 618 - 626 Lease of Waqf Property. Articles 627- 633 Section II LOAN FOR USE Definition. Article 634 1. Obligations of the Lender. Articles 635 - 637 2. Obligations of the Borrower. Articles 638 - 641 3. Termination of the Loan for Use. Articles 642- 644 Chapter III Contracts for the Hire of Services Section I CONTRACTS FOR WORK AND CONCESSIONS FOR PUBLIC UTILITY SERVICES 1. Contracts for Work. Definition. Article 645 Obligations of the Contractor. Articles 646- 653 Obligations of the Master. Articles 654- 659 Sub-contracts. Articles 660- 661 End of Contract for Work. Artícles 662- 666 2. Concessions of Public Utility Services. Articles 667 - 672 Section II CONTRACTS OF SERVICE Definition Article 673 Special Leases Relating to Service. Article 674 Persons Subject to Contracts of Service. Article 675 1. Elements of the Contract. Articles 676 683 2. Effects of the Contract: Obligations of the Worker. Articles 684 - 688 Obligations of the Master. Articles 689 692 3. The End of the Contract of Service. Articles 693 - 698 7 (Chapter III continued) Section III MANDAТЕ 1. Elements of Mandate. Articles 699 702 2. Effects of a Mandate. Articles 703 713 3. The End of the Mandate. Articles 714 717 Section IV DEPOSIT Definition.

Article 718 1. The Obligations of the Depositary. Articles 719723 2. The Obligations of the Depositor. Articles 724- 725 3. Certain Kinds of Deposits. Articles 726 - 728 Section V JUDICIAL CUSTODY Articles 729- 738 Chapter IV Aleatory Contracts Section I GAMING AND BETTING Articles 739 - 740 Section II LIFE ANNUITIES Articles 741- 746 Section III CONTRACT OF INSURANCE: 1. General Provisions. Articles 747 - 753 2. Certain Classes of Insurance; Life Assurance. Articles 754 - 765 Insurance Against Loss or Damage. Articles 766 780 Chapter V Suretyship Section I THE ELEMENTS OF SURETY SHIP Articles 781- 790 Section II THE EFFECTS OF SURETYSHIP: 1. The Relationship between the Surety and the Creditor. Articles 791 806 2. The Relationship between the Surety and the Debtor. Articles 807- 810 SECOND PART REAL RIGHTS BOOK THREE THE PRINCIPAL REAL RIGHTS Chapter I The Right of Ownership Section I THE RIGHT OF OWNERSHIP IN GENERAL 1. Limits and Sanctions. Articles 811- 814 2. Restrictions on the Right of Ownership. Articles 815-833 3. Joint Ownership: Provisions Relating to Joint Ownership. Articles 834- 842 The Cessation of Joint Ownership by Partition. Articles 843- 853 Obligatory Joint Ownership. Article 854 8 (Chapter 1 - continued) Articles 855- 859 Family Joint Ownership. 865 Ownership of Storeys in Buildings. Articles 860- Syndicates of Owners of Storeys in a Single Building. Articles 866- 873 Section 11 ACQUISITION OF OWNERSHIP 1. Acquisition by Appropriation: Articles 874 877 The Appropriation of Movables without an Owner. - The Appropriation of Immovables which have no Owner.Article 878 2. Acquisition by Inheritance and Winding Up of an Estate: Application of Sher'iya Law and Special Laws. Article 879 Articles 880 886 Appointment of Administrator. Articles 887 894 Inventory of the Estate. Discharge of the Debts of the Estate. Articles 895 902 Delivery and Division of the Property of the Estate. Articles 903 917 Rules Applicable to Estates that have not been Wound Up. Art. 918 3. Acquisition by Will. Articles 919 - 921 4. Acquisition by Accession: The Right of Accession in Respect of Immovable Property. Arts. 922 934 The Right of Accession in Respect of Movable Property. Article 935 5. Acquisition by Contract. Articles 936 - 938 6. Acquisition by Pre-emption: Conditions for the Exercise of the Right of Pre-emption. Articles 939 - 943 Procedure for Pre-emption. Articles 944 - 948 Effects of Pre-emption. Articles 949 - 951 Forfeiture of the Right of Pre-emption. Article 952 7. Possession: Acquisition, Transfer, and Loss of Possession. Articles 953 961 Protection of Possession (The Three Possessory Actions). Articles 962 971 Effects of Possession - Acquisitive Precription. Articles 972 979 Acquísítion of Movables by Possession. Articles 980 981 Acquísítion of Fruits by Possession. Articles 982 983 Recovery of Expenses. Articles 984 986 Liability in the Event of Loss. Articles 987 988 Chapter II Rights Derived from the Right Of Ownership Section I THE RIGHT OF USUFRUCT, THE RIGHT OF USER, AND THE RIGHT OF OCCUPATION 1. Usufruct. Articles 989 -999 2. The Right of User and Occupation. Articles 1000-1002 Section 1I LEASE OF LAND OF PLANTATION OF TREES (Mugharisah) Articles 1003-1012 Section III LEASE OF LAND FOR CULT IVATION (Muzara'ah) and IRRIGATION (Musaqah) Articles 1013-1017 Section IV SERVITUDES Articles 1018-1032 9 BOOK FOUR ACCESSORY REAL RIGHTS OR REAL SECURITIES Chapter I Legal Mortgages HOW LEGAL MORTGAGE ARISES Article 1033 Chapter II Mortgage by Agreement Section ) THE CONSTITUTION OF MORTGAGES Articles 1034-1046 Section II THE EFFECTS OF A MORTGAGE: 1. The Effects of a Mortgage as between the Parties As Regards the Mortgagor. Articles 1047-1053 As Regards the Mortgagee. Articles 1054-1056 2. The Effects of a Mortgage as Regards Third Parties. Articles 1057-1059 The Right of Preference and the Right of Tracing. Articles 1060-1085 Section III EXTINGUISHMENT OF THE MORTGAGE Articles 1086-1088 Chapter IШІ Judgment Charges upon Immovable Property Section I THE CONSTITUTION OF A JUDGMENT CHARGE Articles 1089-1097 Section II THE EFFECTS OF A JUDGMENT CHARGE, ITS REDUCTION AND EXTINGUISHMENT Articles 1098-1099 Chapter IV Pledge Section I ELEMENTS OF A PLEDGE Articles 1100-1102 Section II THE EFFECTS OF A PLEDGE 1. As between the Contracting Parties: Articles 1103-1106 Obligations of the Pledgor. Articles 1107-1112 Obligations of the Pledgee. Articles 1113-1116 2. As regards Third Parties Section III Articles 1116-1117 EXTINGUISHMENT OF A PLEDGE Section IV CERTAIN KINDS OF PLEDGE Articles 1118-1120 1. Pledge of an Immovable (Antichresis). Articles 1121-1126 2. Pledge of a Movable. Articles 1127-1133 3. Pledge of Debts. 10 Chapter V Privileged Rights Section I GENERAI PROVISIONS Articles 1134-1140 Section 11 KINDS OF PRIVILEGES; Privileged Rights. Article 1141 1. General Privileges and Special Privileges over Movables. Articles 1142-1150 2. Special Privileges over Immovables. Article 1151 The Libyan Civil Code PRELIMINARY CHAPTER GENERAL PROVISIONS Section I Laws and Their Application 1. Laws and Rights

ARTICLE 1. (E. C. 1) RULES OF LAW 1. Provisions of law govern all matters to which these provisions apply in letter and spirit. 2. In the absence of applicable legal provisions, the Judge shall pass judgment in accordance with the principles of Islamic law. In the absence of Islamic legal precedent, he shall pass judgment according to prevailing custom, and in the absence of precedents in customary procedure, he shall pass judgment according to the principles of natural law (1) and the rules of equity. (1) Natural justice is justice as it is in itself, in deed and in truth as contrasted with those more or less distorted images of it which may be seen in civil and international law... Salmond on Jurisprudence.

ARTICLE 2. (E. C. 2) ABROGATION OF LAWS A provision of law can only be repealed by a subsequent law expressly providing for such repeal, or containing a provision inconsistent with a provision of the former law or regulating anew a matter previously regulated by a former law.

ARTICLE 3. (E.C. 3) CALCULATION OF PERIODS OF LIMITATION Periods of limitation will be calculated according to the Gregorian calendar, unless expressly provided otherwise by a law.

ARTICLE 4. (E.C. 4( EXERCISE OF LAWFUL RIGHT A person who legitimately exercises his rights (2) is not responsible for prejudice resulting thereby. (2) A right is a prerogative, sanctioned by law, which a person may exercise in his relations with other persons.

ARTICLE 5. (E.C. 5) UNLAWFUL USE OF RIGHT The exercise of a right is considered unlawful in the following cases: (a) If the sole aim thereof is to harm another person. (b) If the benefit it is desired to realize is out of proportion to the harm caused thereby to another person. (c) If the benefit it is desired to realize is unlawful. The Application of Laws Conflicts of Law as to Time

ARTICLE 6 (E.C. 6) LEGAL CAPACITY (3) 1. Legislative provisions as regards the legal capacity of a person are applicable to all persons who fulfill the conditions embodied in such provisions. 2. When a person who was deemed to possess legal capacity in accordance with the provisions of a former law, becomes legally incapable in accordance with the provisions of a new law, such legal incapacity does not effect the validity of acts previously done by him. 14 the place in which the 2. Contracts relating to immovables , however, are governed by the law of immovable is situate. (E.C. 20) FORM OF CONTRACTS

ARTICLE 20 Contracts between living persons are govern ed as regards their form by the law of the country in which the contracts are concluded. They may also be governed by the law regulating the basic provisions of n national law. a contract, by the law of the domicile (11) of the parties or by their commo and 53. (11) For definition of "domicile" see Articles 40-43

ARTICLE 21 (E. C. 21) NON-CONTRACTUAL OBLIGATIONS Non-contractual obligations are governed by the law of the State in whose territory the act that 1. gave rise to the obligation took place. 2. When, however, the obligation arises from a tort, the provisions of the preceding paragraph shall not apply to an act which occurred abroad and which, although considered unlawful in accordance with the law of the country in which the act occurred, is considered lawful in Libya.

ARTICLE 22 (E. C. 22) PRINCIPLES OF COMPETENCE OF COURTS AND QUESTIONS OF PROCEDURE Principles of Competence of Courts and all questions of procedure are governed by the law of the country in which the action is brought, or in which proceedings are taken.

ARTICLE 23 (E.C. 23) SPECIAL LAWS AND INTERNATIONAL CONVENTIONS The provisions of the preceding Articles only apply when no provisions to the contrary are included in a special law or in an International Convention in force in Libya.

ARTICLE 24 (E.C. 24) APPLICATION OF PRINCIPLES OF PRIVATE INTERNATIONAL LAW The Principles of Private International Law apply in the case of a conflict of laws for which no provision is made in the preceding Articles.

ARTICLE 25 (E. C. 25) PERSONS OF UNKNOWN OR PLURAL NATIONALITY 1. In the case of a person of unknown nationality the law to be applied will be decided by the Judge. 2. Libyan law shall apply, however, if a person is deemed in Libya to be of Libyan nationality and is at the same time deemed by one or more foreign States to be a national of that or those States.

ARTICLE 26 (E.C. 26) PLURALITY OF LAWS When, in accordance with the preceding provisions, it appears that the law to be applied is the law of a State in which several legal systems exist, the law applicable shall be determined by the internal law of that State.

ARTICLE 27 (E. C. 27) EXTENT OF APPLICATION OF FOREIGN LAW In the cases where a foreign law is applicable only the internal provisions of such foreign law shall apply to the exclusion of provisions relating to Piivate International Law.

ARTICLE 28 (E.C. 28) PUBLIC POLICY OR MORALITY The provisions of a foreign law applicable by vírtue of the preceding Articles shall not be applied if these provisions are contrary to public policy or to morality in Libya. (12) (12) A transaction is regarded in England, for example, as having an object contrary to public polícy if it contemplates: (a) unreasonable restraint of trade, (b) evasion of obligations imposed by law, (c) purchase or sale of an honour or public office, (d) assignment of the salary of a public office, (e) jobbery in the public service, (f) defeat or delay of creditors, (g) stifling of prosecution for a criminal offence, or other perversion of the course of justice, (h) a breach of intemational comity. 16 FESSION RCISING TRADE OR PRO

ARTICLE 41 (E. C. 41) DOMICILE OF PERSON EXE as regards ssion is considered as his domicile exercises a trade or profe The place where a person with such trade or profession. conn ecti on matters carried on in ONS UNDER DISABILI TY, (E.C. 42) DOMICILE OF MINORS, PERS

ARTICLE 42 ONS MISSING AND ABSENT PERS will person under legal disability, a missing person or an absent person 1. The domicile of a minor, a of his legal repres entative. be the domicile ss ar legal position shall neverthele A mínor who has attained eight een years and a person in a simil 2. perfo rming accor dance with the law. is capab le of in have his special domicile in respect of acts he

ARTICLE 43 (E.C. 43) ELECTION OF DOMICILE the performance of a specific legal act. 1. A special domicile may be elected for 2. The election of domicile must be evidenced by writing. a legal act shall be deemed to be the domicil e in so far 3. A domicile elected for the performance of conceme d, includin g the procedure for enforcement by legal means as all matters relating to such act are to certain special acts, excluding others. unless the election of domicile is expressly limited

ARTICLE 44 (E.C. 44) ATTAINMENT OF LEGAL CAPACITY AND MAJORITY 1. All persons attaining majority in possession of their mental faculties and not under legal disability. have full legal capacíty to exercise their civil rights. 2. The majority of a person is fixed at twenty-one years completed in accordance with the Gregorian Calendar.

ARTICLE 45 (E. C. 45) LEGAL INCAPACITY 1. A person devoid of discretion owing to youth, feeble mindedness or insanity is incapable of exercising his civil rights. 2. A person who has not attained the age of seven is considered devoid of discretion.

ARTICLE 46 (E.C. 46( LIMITED LEGAL CAPACITY A person who has reached the age of discretion but has not attained majority and a person who has attained his majority but is a prodigal or an imbecile, has a limited legal capacity according to the provisions of the law.

ARTICLE 47 (E. C. 47) PROTECTION OF PERSONS OF LEGAL INCAPACITY AND LIMITED LEGAL CAPACITY Persons deprived of full or partial legal capacity are governed, as the case may be, by the rules of natural or legal guardíanship or curatorship subject to the conditions and in accordance with the rules laid down by law.

ARTICLE 48 (E. C. 48) PROTECTION OF LEGAL CAPACITY No person can renounce his legal capacity or modify the rules relating thereto.

ARTICLE 49 (E.C. 49) PROTECTION OF PERSONAL FREEDOM No person can renounce his personal liberty.

ARTICLE 50 (E.C. 50) PROTECTION OF RIGHTS INHERENT IN PERSONALITY (13) A person whose rights inherent in his personality have been unlawfully infringed shall have the right to demand the cessation of the infringement and compensation for any damage sustained thereby. (13) The rights inherent in a person's personality are the right to possess a family status, the faculty to have property and the right to enjoy the essential liberties of an individual. 38 woids "slhokds to translate the Arabic le person" have been used (4b) Tlis wurds "reasonab se IW whids " as the Egyptian legislator used the rally neans "normal person originally used in the Napoleonic Code io deseth e a whc ille" as yL. "ho n per e de fam tak ing or dn pessin aff air s, hav ing ord ina ry knowledge and Enihle man managing his own or part of the work of wi WINIA valuntary agent dele gates to a third party the whole of his delegate, wilin l be responsible for the acts hmed thie management he shal acts to his direct remedy against the delegale, I Hi t at the perean for whom he g the same work they are all jointdy and æyeially 4 WIr H are several voluntary agents doin T TO RETURN WHAI (E.C. 199) OBLIGATION OF VOLUNTARY AGEN АВТИТЕ THE ACCOUNTS HE RECEIVED AND TO RENDER mandatary as regards the restitut 4 itary agent is bound by the same obligations as a A whitch hie received as a result of his management and as regards rendering accounts therenl, Hint DEATH OF VOLUNTARY AGENT OR OF THE PERSON FOR

ARTICLE 17 (E, C. 194) WHOM HE ACTS are bound by the same obligat to HF event of the death of a voluntary agent his heirs provisi ons of Article 717 paragra ph 2. AR HH At a nandatary in accordance with the event of the death of the person for whom he acts the voluntary agent is hound by 111 is le bligations to the heirs as he was to the person of whom they were the successors HH, (E, C, 195) OBLIGATIONS OF PERSON FOR WHOM VOLUNTARY AGENT

ARTICLE 188 WORKS A veluntary agent is deemed to be the representative of the person for whom he has acted, if he ln devated to the management of the work the care of a reasonable person, even if the ohjeer ViEw hAs not heen achieved, The person for whom the voluntary agent has acted will he hond eatty out the ohligations entered into on his behalf by the voluntary agent, to indemnify hin agai All dffakings aseumed by him, to reimburse him monies usefully or necestarily expended hy him wiuch are juetitied by the circumstances together with interest thereon from the date of expenditure, and te indemmify him in respect of any loss he has suffered as a result of his management, The velntary agent is not entitled to any remuneration for his work, unless the work comes within thE seops of his profesional business. ARTIGLE 100 (,C, 196) LEGAL CAPACITY OF VOLUNTARY AGENT TO ENTER INTA CONTRAСТ it a voluntary agent is not legally capable of entering into contracts he will only be respune ter hi managament to the extent of his profit therefrom, provided that his liability does not reан FrAm An unlawful aCH H. peron for whom the voluntary agent acts remains, however, fully responsible, even if he tlegally incapable of entering into a contract.

ARTICLE 00 (R,C, 197) PRESCRIPTION A claim arieing from veluntary agency is prescribed after three years from the day that each parry hnd kiowledge of hia right and in any case after fifteen years from the day on which the right A 39 Section V The Law

ARTICLE 201 (E.C.198) OBLIGATIONS ARISING IN CONSEQUENCE OF THE LAW Obligations which arise directly and solely in consequence of the law are govemed by the provisions of the law giving nse to such obligations (37). (37) Compare Article 1057 of the Quebec Civil Code as follows: Obligations result in certain cases from the sole and direct operation of law, without the intervention of any act and independently of the will of the person obliged or of him in whose favour obligation is imposed. Such are the obligations of tutors and the other administrators who cannot refuse the charge cast upon them: Chapter II The Effects of Obligations

ARTICLE 202 (E.C. 199) PERFORMANCE OF OBLIGATIONS 1. An obligation is enforceable against the debtor. 2. The performance of a natural obligation (38), however, cannot be enforced. (38) Natural Obligations are duties which, although they are legal in their nature in the sense that they are per se capable of being enforced, are, however, duties in respect of which the law gives no right of action. There must be a legal link between the persons, but a link which the law refuses to recognise, for example, a contract informal for not complying with some formality required by law, viz., contracts of women or infants entered into without the approval of husband or guardian, as the case may be, a nght barred by prescription, legacies left by a will irregular in form.

ARTICLE 203 (E.C. 20O) NATURAL OBLIGATIONS The Judge shall decide, in the absence of any provision of the law, whether a natural obligation exists. There cannot ever be a natural obligation that is contrary to public polícy.

ARTICLE 204 (E. C. 201) DISCHARGE OF NATURAL OBLIGATION A debtor cannot claim restitution of that which he has voluntarily given to another with the object of discharging a natural obligation.

ARTICLE 205 (E. C. 202) QUALITY OF NATURAL OBLIGATION A natural obligation may constitute a valid cause for a civil oblígation. Section I Specific Performance

ARTICLE 206 (E.C.203) SPECIFIC PERFORMANCE OF OBLIGATIONS (39) 1. A debtor shall be compelled, upon being summoned to do so in accordance with Articles 222 and 223, specifically to perform his obligations, if such performance is possible. 2. When, however, specific performance is too onerous for the debtor, he may limit performance to payment of a sum of money as indemnity. provided that this method of performance does not seriously prejudice the creditor. (39) Specific Performance consists in doing the very thing which the debtor has promised in the contract (Walton II, P.232). 40 TRANSFER OF OWNERS HIР ARTICIF W (E.C. 204) fer ownership or Subiect to the rules with regard to transcription, an obligation to trans transfers ipso facto that right, if the object of the obligation is any other teal right the debtor (40). specitically identified and is owned by things of the outside world, land, (40) "Real Rights" are rights which have for their object direct and immediate power over houses, movable objects, giving to their possess or a varies accordi ng to the rights themselves these things, the extent of which power s", 123. (ef. "jus in re"). Colin and Capitant, "Droit Civil Francai G AS ITS ARTICIE 2OS (E.C. 205) OBLIGATION TO TRANSFER REAL RIGHT HAVIN ОВJЕСТ THING NOT SPECIFICALLY DESCRI BED 1. When an obligation to transfer a real right has for its object a thing which is described only as regards species, the right is not transferred, unless the object is identified as regards its individuality. 2 If, however, the debtor does not perform his obligation, the creditor may, upon an order of the judge, or in case of urgency even without such an order, acquire, at the expense of the debtor, an article of the same kind; he may also claim the value of the articles without prejudice to his rights to damages, in either case.

ARTICLE 806 (E.C. 206) TRANSFER TO REAL RIGHT AND PRESERVATION THEREOF An obligation to transfer a real right includes that of the delivery of the article and of the preservation thereof up to time of delivery.

ARTICLE 10 (E.C. 207) DESTRUCTION OF THING BEFORE DELIVERY 1. When a debtor is under an obligation to transfer a real right or to do something which comprises an obligation to deliver a thing, he will be responsible, should he fail to deliver the thing after having been formally summoned to do so, for the loss thereof, even if the risk or loss prior to the issue of the summons was the liability of the creditor. 2. The risk of loss, however, does not pass to the debtor, even upon the issue of a formal summons, if he establishes that the thing would also have perished in the keeping of the creditor if it had been delivered to him, unless the debtor has accepted to take accidental loss at his own risk. 3. The risk of loss of a stolen thing, no matter how the thing perishes or is lost, is the responsibility of the thief.

ARTICLE 211 (E. C. 208) PERSONAL PERFORMANCE When the contract or the nature of the obliga tion demands that the obligation to do something shall be performed by the debtor person ally, the creditor may refuse the performanc obligation by any person other than the debtor. e of the

ARTICLE 212 (E. C. 209) PERFORMANCE AT EXPENSE OF DEBTOR 1. In the case of non-performa nce by the debtor of an obligation to do something, the creditor may apply to the Court for an order to carry out the this is possible. obligation at the cost of the debtor, if 2. In a case of urgency, the creditor may carry out the obli without an order from the Court. gation at the cost of the debt or

ARTICLE 213 (E.C.210) JUDGMENT TAKES PLACE OF PERFORMANCE When the nature of the obli gation so permits, a Judgment may something, take the place of , in case of an obligation the performance of the cont to do ract (41). (41) A judgment takes the place of performance if, for exam ple, when a man has to sell property but has not executed a deed promised deed and declares tha of sale, the Judgment ordersh t in default of his so im to exec ute the equivalent to the dee doing the Judgment itse d of sale (Walton II, lf will be held to be p.235). 41

ARTICLE 214 (E.C. 211) CONDITION THAT REASONABLE CARE OF THING BE EXERCISED 1. Subject always to any provision of the law or agreement to the contrary in the case of an obligation to do something, a debtor who is required to preserve a thing, to manage it to act with prudence in the performance of his obligation, satisfies his obligation if he brings to the performance thereof the care of a reasonable person, even if the object in view is not achieved. 2. The debtor always remains liable for fraud or or gross negligence.

ARTICLE 215 (E. C. 212) BREACH OF OBLIGATION TO REFRAIN FROM DOING SOMETHING 1. When the specific performance of an obligation is impossible or not practicable, unless performed by the debtor himself, the creditor may obtain a Judgment ordering the debtor to perform the obligation and to pay a penalty if he abstains from performing his obligation. 2. If the Judge finds that the amount of the penalty is insufficient to make the debtor perform his obligation he may increase the penalty each time that he considers it is desirable to do so.

ARTICLE 217 (E.C. 214) DAMAGES After specific performance has been carried out or when a debtor has persisted in his refusal to perform the obligation the Judge shall fix the amount of damages that the debtor shall pay, taking into account the prejudice ruffered by the creditor and the unjustifiable attitude of the debtor. Section I Compensation in lieu of Performance

ARTICLE 218 (E. C. 215) IMPOSSIBILITY OF SPECIFIC PERFORMANCE When specific performance by the debtor is impossible he will be condemned to pay damages for non-performance of his obligation, unless he establishes that the impossibility of performance arose from a cause beyond his control, The same principle will apply if the debtor is late in the performance of his obligation.

ARTICLE 219 (E.C. 216) CONTRIBUTION OF CREDITOR TO CAUSE OF LOSS The Judge may reduce the amount of damages or may even refuse to allow damages if the creditor, by his own fault, has contributed to the cause of, or increased, the loss.

ARTICLE 220 (E.C. 217) DISCHARGE OF DEBTOR FROM LIABILITY 1. The debtor may by agreement accept liability for unforeseen events and for cases of force majeure. 2. The debtor may by agreement be discharged from all liability for his failure to perform the contractual obligation, with the exception of liability arising from his fraud or gross negligence.The debtor may, nevertheless, stipulate that he shall not be liable for fraud or gross negligence committed by persons whom he employs for the performance of the obligation. 3. Any clause discharging a person from responsibility for unlawful acts is void.

ARTICLE 221 (E.C. 218) CONDITION THAT DEBTOR BE FORMALLY SUMMONED Damages, subject to an agreement to the contrary, are not due unless the debtor has been formally summoned (42). (42) Default implies that the person who is entitled to call for the performance of an agreement has been damaged and that the person who is to perform is obliged to compensate in performing the him. A person is not in default until it is legally proved that his delay is the instrument duty causes damage to the other party. A formal summons to perform by which one person calls on another to do what he has undertaken to do. 42 G DEBTOR SUMMONIN R FORMALLY METHOD PO (K. C. 219 ) any equivale nt act Court or by

ARTICLE 222 served through the of Civil and Co mmercial summoned by a summon s fo rm al ly pr ov id ed for in the Code er ed to be in shall be consid A deb tor ia er t in the mann The summon s may be by pos sti pul ati ng that the debtor being ag re em en t er for mal ity y result from an without any oth Procedure or ma exp ira tio n of the time period re fact of the default by the me S required. SSARY IN CERTAIN CASE PORMAL SUMM ONS NOT NECE

ARTICLE 223 (E.C, 290) necessary in the following cases: ons to the debtor will not be erest by an act of the or without int A fortial summ ce of the obligation becomes impossible (a) if the performan t of an unlawful act , debtor. t of damages in respec object of the obliga tion is the paymen debtor knew to have (b) if the on of a thing that the the obligation is the restituti to him . (c) if the object of he received knowin g that it was not due been stol en or of a thi ng that end to per for m his obligation. (6) If the debtor declares in wri ting that he does not int AGES ASSESSMENT OF DAM

ARTICLE 224 (E.C.221) ract or by been fixed on the cont of the damages, if it has not 1. The Judge will fix the amou nt ch he has creditor and profi ts of whi law. The amount of dama ges includes losses suffered by the perf orm the obli gation or result of the failu re to that they are the normal been deprived, provided idered to be a norm al resu lt if the These losses shall be cons of delay in such performance, t. by making a reasonable effor creditor is not able to avoid them r who has not been guilty of fraud act, a debto When, however, the obligation arises from contr 2. ges greater than those which could have normally or gros negligence will not be held liable for dama en at the time of enteri ng into the contract. been forese (E. C. 222) DAMAGES FOR MORAL PREJUDICE

ARTICLE 225 ce. The right to compensation for moral 1. Damages also include compensation for moral prejudi unless it has been fixed by agreement prejudice cannot, however, be tranemitted to a third party, or unless it has been the subject of legal proceedings. compensation for moral prejudice only to spouses and to relatives up to 2. The Judge may award the second degree, by reason of grief caused to them by the death of the victim.

ARTICLE 226 (E.C. 223) FIXING AMOUNT OF DAMAGES IN CONTRACT The parties may fix in advance the amount of damages either in the contract or in a subsequent agreement, subject to the provisions of Articles 218 or 223.

ARTICLE 227 (E. C. 294) AGREED DAMAGES NOT DUE 1. Damages fixed by agreement are not due if the debtor establishes that the creditor has not suffered any losm. 2. The Judge may reduce the amount of these damages if the debtor establishes that the amount fixed was gromly exaggerated or that the principal obligation has been partially performed. 3. Any agreement contrary to the provisions of the two preceding paragraphs is void.

ARTICLE 288 (E. C. 225) EXCESS OF DAMAGE OVER THAT AGREED When the loss exceeds the amount fixed by the contract the creditor cannot claim an increased sum, unless he is able to prove that the debtor has been guilty of fraud or gross negligence.

ARTICLE 229 (E. C. 286) DAMAGE POR DELAY When the object of an obligation is the payment of a sum of money of which the amount is known at the time when the claim is made, the debtor shall be bound, in case of delay in payment, to pay to the creditor, as damages for the delay, interest at the rate of four per cent in civil matters and five per cent in commercial matters, Such interest shall run from the date of the claim in Court, unless the contract of commercial usage fixes anothe date. This article shall apply, unless otherwise provided in law. 43

ARTICLE 230 (E.C.227 except that interest in E.C. is 7%) AGREED INTEREST 1 The parties may agree upon another rate of interest either in the event of delay in effecting payment or in any othercase in which interest has been stipulated, provided that it does not exceed 10%. If the parties agree to a rate exceeding ten per cent the rate will be reduced to ten percent and any surplus that has been paid shall be refunded. 2. Any commission or other consideration of whatsoever nature stipulated by the creditor which, together with the agreed interest, exceeds the maxin'm limits of interest set out above will be considered as disguised interest and will be subject to reduction, if it is not established that this commission or consideration is in respect of a service actually rendered by the creditor or of a lawful consideration.

ARTICLE 231 (E.C. 228) RIGHT OF CREDITOR TO INTEREST Moratory interest, whether fixed by law or agreement, is due without the creditor being obliged to prove loss as a result of delay.

ARTICLE 232 (E.C. 229) POWER OF COURT TO REDUCE INTEREST If a credítor, whilst claiming his rights, has, in bad faith, prolonged the duration of the litigation, the Judge may reduce the legal or contractual interest or may refuse to allow interest for the whole of the period during which the litigation has been unjustifiably prolonged.

ARTICLE 233 (E.C. 230) MORATORY INTEREST ON SALE OF EXPROPRIATED PROPERTY In a distribution of the price of expropriated property creditors admitted to the distribution will only be entitled, as from the date of sale by auction, to moratory interest on amounts allocated to them in the distribution, if the purchaser is bound to pay interest on the price, or if the Court Treasury is bound to pay interest as a result of the deposit of the price at the Treasury and only to the extent of interest due by the purchaser or by the Treasury, which interest will be distributed amongst all the creditors pro rata,

ARTICLE 234 (E.C.231) DAMAGES IN ADDITION TO INTEREST of A creditor may demand damages in addition to interest if he establishes that a loss, in excess an interest, was due to bad faith on the part of the debtor (43). (43) Compare Articles 1150 and 1151 of the French Civil Code. When the debtor is of good faith, he has only to pay the damages which would result from the breach of contract which had been actually foreseen at the time of entering into the contract. A fraudulent breach of contract involves damages actually caused which might not have been capable of being foreseen, the principle being that a fraudulent person must repair all the wrong he has done, but it is limited by this, that he is not liable to pay for remote or indirect results of the breach but only for the necessary consequences thereof.

ARTICLE 235 (E. C. 232) INTEREST ON OUTSTANDING INTEREST Subject to any commercial rules or practice to the contrary, interest does not run on outstanding interest and in no case shall the total interest that the creditor may collect exceed the amount of the capital.

ARTICLE 236 (E. C. 233) COMMERCIAL INTEREST ON CURRENT ACCOUNTS The legal rate of commercial interest on current accounts varies accordíng to the local market rate applicable, and capitalization is effected on current accounts according to commercial usage. 44 Section III editors the Rights of Cr ing and Securing Means of Realiz PROPERTY OF DE BTOR OR OVER (E.C. 234) RIGHTS OF CREDIT

ARTICLE 237 . are secu red by all his property 1. The debts of a debtor e with law all creditors are treated as t of preferen ce acquired in accordanc 2. Subject to any righ on a footing of equality. regards this security ts of Creditors 1. Means of Realizing the Righ TS OF ACT ION BY CREDITOR (E. C. 235) EXERCISE OF DEBTOR'S RIGH

ARTICLE 238 ise in the name of his debto r has not fallen due, may exerc 1. Every creditor, even if his claim y t be attached. n save only those that are purel perso nal or canno all his debtor's rights of actio unless the creditor proves rights of his debtor is not admissible The exercise by a creditor of the 2. e to do so is such as 's failur sed such rights and that the debtor that the debtor himself has not exerci necess arily forma lly summon the to result in or increase his insolv ency. The creditor need not always join the debtor in the proceedings. debtor to exercise his rights but he must 239 (E.C. 236) EFFECT OF EXERCISE OF DEBTOR'S RIGHT BY CREDITOR ARTICLE A creditor, in the exercise of his debtor's right, is deemed to be the debtor's representative. fall into the patrimon ium of the debtor The proceeds resulting from the exercise of such rights and serve as security to all his creditors.

ARTICLE 240 (E. C. 237) ACTION TO DECLARE VOID ACTS OF DEBTOR Any creditor whose claim has fallen due and whose debtor has entered into an act of alienation prejudicial to him may demand that such act be declared void so far as he is concerned, if such act has either diminished his (the debtor's) rights or increased his obligations, and has in consequence resulted in, or increased, his insolvency, when the conditions provided for in the following Article are all present.

ARTICLE 241 (E. C. 238) CONDITIONS FOR ACTION TO DECLARE ACTS OF DEBTOR VOID 1. If the act by the debtor is for valuable consideration it can only be held invalid as against the creditor if made by the debtor with the intent to defraud and if the other party to the contract was aware of the fraud. It suffices for the act to be considered fraudulent if the debtor knew, at the time that it was effected, that he was insolvent; the other party is deemed to have had knowledge of the fraud of the debtor if he was aware of the debtor's insolvency. 2. If, however, the act entered into by the debtor was gratuitous it is not valid as against the creditor,even if the transferee acted in good faith and it is established that the debtor did not commit fraud. 3. If a transferee disposes of property transmitted to him by a debtor for valuable consideration, a creditor can only claim avoidance of the act by the debtor if it was made for valuable consideration and if the second as well as the first transferee both knew of the debtor's fraud, and when the act by the debtor was gratuitous and the second transferee knew of the insolvency of the debtor at the time the debtor entered into the act in favour of the first transferee.

ARTICLE 242 (E.C. 239) INSOLVENCY OF DEBTOR A credítor who alleges the insolvency of his debtor has only to establish the amount of his debts. It is for the debtor to prove that his assets are equal to or exceed his liabilities. 45

ARTICLE 243 (E. C. 240) EFFECT OF AVOIDANCE OF ACT OF DEBTOR Once an act has been declared void the benefits that result from the cancellation of the act shalt benefit all the creditors to whose prejud ice the act was made.

ARTICLE 244 (E. C. 241) EVASION OF ACTION BY CREDITOR When person acquires a right from an insolvent debtor but has not paid the price, he may escape a the consequence of an action by a creditor, provided that the price corresponds to the normal price and he deposits this price in the Court Treasury.

ARTICLE 245 (E.C. 242) SPECIAL CONDITIONS AS TO FRAUD 1. Fraud which consists solely of giving a creditor an unjustified preference over another creditor only entails the loss of that advantage by the creditor who has given the unjustifted preference. 2. If an insolvent debtor pays off one of his creditors before the date originally fixed for payment, the payment is not valid as against the other creditors. Neither is a payment, made after the date fixed for payment, valid as against the other creditors if made as a result of a fraudulent arrangement between the debtor and the creditor so paid off.

ARTICLE 246 (E.C.243) PRESCRIPTION An action to set aside an act of alienation is prescribed after three years from the date on which the creditor has knowledge of the grounds for such an action. It is prescribed in any case after fifteen years from the date on which the contested alienation was effected.

ARTICLE 247 (E.C.244) SIMULATED CONTRACT AND ITS EFFECT 1. If a simulated (44) contract has been drawn up, creditors of the contracting parties and particular successors in title, may, if they are in good faith, avail themselves of the hidden contract and establish by any means the simulation of the contract by which they were prejudiced. 2. In the case of a conflict of interest between interested parties, some of whom rely upon the ostensible contract and others on the hidden contract, the former shall have preference. (44) There is simulation where the parties make an ostensible agreement, the effects of which are modified or entirely destroyed by another agreement contemporary with the first and intended to remain secret (Walton II p. 127). For example, a testator of Egyptian nationality who is not free to bequeath his whole estate to strangers may cloak the intention of donation under the guise of an onerous contract.

ARTICLE 248 (E.C. 245) PRECEDENCE OF GENUINE OVER OSTENSIBLE CONTRACТ When the contracting parties hide a genuine contract behind an ostensible contract the genuine contract will bind the contracting parties and their universal successors in title.

ARTICLE 249 (E. C. 246) THE RIGHT OF RETENTION (45) 1. A person who is under an obligation to supply something may refrain from performing his obligation so long as his creditor does not offer to perform an obligation incumbent on him arising out of the obligation of the debtor and connected therewith, or as long as the creditor does not supply adequate security to gurantee the performance of his obligation. 2. This right belongs especially to the possessor or holder of a thing, if he has incurred expenditure of a necessary or useful kind on the thing. The possessor or holder may, in such a case, refuse to return the thing until he has been repaid the amount due to him, unles the obligation of restitution results from an unlawful act. (45) Right of detention (orright of lien): In those contracts where the action for the return of a thing is brought by a plaintiff who is himself in breach of some duty under the contract, the other party is given a right of retention of the thing until the plaintiff has fulfilled his legal obligations. 46

ARTICLE 250 (E.С.247. Article 1193 mentioned in para. 3 hereof is Article 1119 in E.C.) EPPECT OF RETENTION 1. A mere right of retention does not imply a privilege upon the thing. 2. A person who retains the thing must preserve the thing in accordance with the rules as to pledge and must render an account of the fruite. 3. of a perishable nature or susceptible of deterioration, the person who If the thing retained is retains the thing may obtain from the Court authority for its sale in accordance with the provisions of Article 1123. The right of retention will thon be transferred to the price thereof.

ARTICLE 251 (E. C. 248) EXTINCTION OF RIGHT OF RETENTION 1. The right of retention is extinguished by the fact of the thing ceasing to be in the hands of the possessor or the holder, 2. A person retaining the thing, who has lost possession thereof without his knowledge or in spite of his opposition, may claim restitution of the thing, if he makes his claim within a period of thirty days from the time he became aware of the loss of possession, provided that one year has not elapsed since the date of loss. 47 Chapter III Kinds of Conditions Modifying the Effects of Obligations Section I Conditional Obligations and Time Clauses 1. Conditional Obligations

ARTICLE 252 (E.C.265) OBLIGATION DEPENDENT UPON CONDITION An obligation is conditional when its existence depends on a future and uncertain event.

ARTICLE 253 (E.C.266) OBLIGATION DEPENDENT UPON IMPOSSIBLE OR UNLAWFUL CONDITION 1. An obligation is void when the condition upon which it depends is impossible, contrary to morality or to public order, and the condition is suspensive (46), If the condition is resolutory (47) the condition itself is deemed to be inexistent. 2. An obligation depending upon a resolutory condition contrary to morality or public order is, however, void if the condition was the determining factor for undertaking the obligation. (46) A suspensive condition is a condition which makes the coming into force of a legal relationship provided for in an agreement, dependent upon the happening of an uncertain future event, which event must be possible and lawful, e.g., a person insures his building against fire and the insurance company undertakes to indemnify him if the building is destroyed by fire. (47) A resolutory condition is a condition which the extinguishment of a legal relationship, provided for in an agreement dependent upon the happening of a future uncertain event which must be possible and lawful, e.g., a donor stipulates that the gift will be rescinded if the donee dies before the donor.

ARTICLE 254 (E.C.267) OBLIGATION DEPENDENT UPON SUSPENSIVE CONDITION An obligation is void when it is subject to a suspensive condition by which the existence of the obligation depends solely on the will of the person who underttok the obligation.

ARTICLE 255 (E.C.268) PERFORMANCE OF OBLIGATION DEPENDENT UPON SUSPENSIVE CONDITION When an obligation depends on a suspensive condition it does not become executory until the condition is realized. Before realization of the condítion such obligation is not subject to compulsory or tovoluntary performance. A creditor may, however, take protective measures to safeguard his rights.

ARTICLE 256 (E.C.269) THE RESOLUTORY CONDITION 1. An obligation is extinguished when the resolutory condition is realized. The creditor must le by reason-of a cause for which he restitute that which he has received; if restitution is impossib is responsible he will be liable for damages. retain their valldity notwithstanding the 2. Acts of management carried out by a creditor shall realization of the condition. 48 CONDITION (E. C. 270) RETROACTIVE EFFECT OF

ARTICLE 257 to the day on which the obligation was tion is effective retroactively 1. The fulfilment of a condi the contract reason of the nature of the will of the parties or by contracted unless it appears from or its extinction should take effect from the moment of the that the existence of the obli gation fultilment of the condition. not have retroactive effect if the execution of the obligation In any case, the condition will t of account of a cause independen . ment of condit ion, on becomes impossible before the fulfil the the debtor and for which he is not responsible. 2. Time Clauses

ARTICLE 258 (E.C. 271) DEFINITION An obligation is for a term if its performance or extinction depends on a future certain event. 1. if the time at which it 2. An event is considered to be certain if it must happen of necessity even should happen is unknown.

ARTICLE 259 (E. C. 272) FIXING OF TIME BY JUDGE When it results from the obligation that the debtor shall only perform the obligation when he is able to do so or when he has the means to do so, the Judge will fix a reasonable time for the term, taking into account the actual and future resources of the debtor and allowing for the diligence of a man anxious to perform his obligations.

ARTICLE 260 (e.c.273( FORFEITURE OF BENEFIT OF TERM A debtor will forfeit the benefit of the term: 1. If he is declared bankrupt in accordance with the provisions of the law (48). 8. If he has, by his own act, apparently diminished the specíal security given to the creditor, even if this security was given by a subsequent act or by virtue of the law, unless the creditor perfers to demand additional security. If the reduction of the security is due to a cause for which the debtor is not responsible, he will forfeit his rights to the term unless he provides adequate security. 3. If he does not supply the creditor with the security promised in the contract. (48) In the E.C. the words "or insolvent" follow "bankrupt" but this has been omitted in the Libyan Code.

ARTICLE 261 (E.C. 274) EFFECT OF THE TERM 1. An obligation with a suspensive term only becomes due on the date of the expiration of the term. The creditor may, however, even before the end of the term, take measures to protect his rights and may, in particular, ask for security if he fears that the debtor may become bankrupt or insolvent, and has reasonable ground for his fears. 2. At the end of a resolutory term the obligation is extinguished without such extinction having any retroactive effect. Section П Plurality of Objects of an Obligation 1. Alternative Obligations

ARTICLE 262 (E.C. 275) DEFINITION An obligation is alternative when its object includes numerous presentations and the debtor is entirely freed by the performance of one of them. The option, in the absence of any specia provision in the law or of an agreement by the parties l to the contrary, belongs to the debtor. 49

ARTICLE 263 (E.C. 276) REFUSAL OF A WANT OF AGR EEMENT AS TO OPTION 1. If the option belongs to the debto r and he fails to elect or if there are a numb er of debtors who do not agree among themselves, the creditor may apply to the Judge to fix a term for the debtor to elect or for the several debtors to agree among themselves, failing which the Judge will himsel the object of the obligation. f fix 2. If the option belongs to the credit or and he fails to elect, or if there are a number of creditors who do not agree among themselves , the Judge, if required by the debtor, will fix a expiration of which the option will pass to the term at the debtor.

ARTICLE 264 (E. C. 277) IMPOSSIBILITY OF PERFORMANCE If the option belongs to the debtor and not one of the several prestations include d in the object of the obligation can be performed, he shall be bound to pay the value of the last of the prestations that became impossible to perform if he is responsible for the impossibility of performance even as regards one only of the prestations. 2. Facultative Obligations

ARTICLE 265 (E.C.278) DEFINITION 1. An obligation is facultative when its object consists of one prestation only but the debtor may free himself of the obligation by the performance of another prestation in its place. 2. The object of the obligation is the prestation promised and not that prestation the performance of which frees the debtor. It is this object which determines the nature of the obligation. Section I Plurality of Parties to an Obligation 1. Joint and Several Obligations

ARTICLE 266 (E. C. 279) SOLIDARITY NOT PRESUMED Solidarity between creditors or between debtors is not presumed. It is created by agreement or by law.

ARTICLE 267 (E. C. 280) SOLIDARITY BETWEEN CREDITORS 1. When there is solidarity between creditors, the debtor may pay the debt to any one of them unless one of them objects to such payment. 2. Solidarity does not prevent the debt being divided between the heirs of one of the joint and several creditors unless the debt itself is indivisible.

ARTICLE 268 (E.C. 281) RIGHT OF ACTION AGAINST DEBTOR AND DEFENCES THERETO 1. Joint and several creditors may take proceedings jointly or severally against the debtor for the performance of the obligation. In so doing the conditions modifying the effect of the obligation as between each creditor and the debtor should be taken into account,. 2. A debtor cannot, if he is sued for payment by one of his joint and several creditors, set up as a defence against that creditor defences that are personal as regards the other creditors, but he may set up defences which are personal to the creditor suing him and those which are common to all the creditors.

ARTICLE 269 (E.C. 282) RELEASE OF DEBTOR L. If a debtor is released of his debt to one of his joint and several creditors for a reason other than performance, he shall be released as regards the other creditors only up to the amount of the share of the creditor to whom he is no longer liable. 2. No one of the joint and several creditors may act in such a way as to prejudice the rights of the other creditors. 50 CREDITORS

ARTICLE 270 (E. C. 283) SHARES OF JOINT AND SEVERAL al creditor recei ves on account of the debt reverts to all the 1. That which a joint and sever een them proportionately. creditors and will be divided betw ion of the law to the The division shall be made in equal parts if there is no agreement or provis 2. contrary.

ARTICLE 271 (E. C. 284) SOLIDARITY OF DEBTORS payment effected by one of them liberat es all the When there is solidarity between the debtors others,

ARTICLE 272 (E.C. 285) ACTION AGAINST JOINT AND SEVERAL DEBTORS 1. A creditor may take action against all his joint and several debtors jointly or severally. In so as between the creditor and each of doing the conditions modifying the effect of the obligations the co-debtors should be taken into account. 2. A co-debtor who is sued by a creditor for performance cannot set up against that creditor defences that are personal to other co-debtors, but he may set up defences that are personal to himself as well as those common to all co-debtors.

ARTICLE 273 (E.C.286) NOVATION OF DEBT Novation (49) of a debt between the creditor and one of the joint and several debtors releases other co-debtors unles the creditor has reserved his rights against them. (49) Novation is the substitution of a new debt for an old one which ceases to exist, or of the substitute of a new creditor or a new debtor.

ARTICLE 274 (E.C.287) COMPENSATION A Joint and several debtor cannot set up compensation (50) with regard to that which a creditor owes to one of the other co-debtors, except in respect of the share of such co-debtor. (50) See Article 349 of Libyan Code.

ARTICLE 275 (E.C.288) MERGER Merger (51) that occurs in the person of a creditor and of one of the joint and several debtors does not extinguish the debt as regards to other co-debtors except to the extent of the merger share of the co-debtor. (51) See Article 357 of Libyan Code.

ARTICLE 276 (E. C. 289) RELEASE OF DEВТ 1. A release of debt granted by the creditor to one of the joint and several debtors does not release the other co-debtors unless the creditor expressly declares such to be the case. 2. in the absence of such a declaration the creditor may only claim from the other co-debtors the balance of the debt after deduction of the share of the co-debtor whom he has released, unless he has reserved his rights against them for the whole of the debt. In such a case the joint and several debtors have a claim against the co-debtor who has been released for hisshare in the debt.

ARTICLE 277 (E. C. 290) RELEASE FROM JOINT AND SEVERAL LIABILITY If a creditor releases one of the joint and several debtors from the joint and several liability his right to claim the whole of the debt from the other co-debtors remains unless otherwise agreed.

ARTICLE 278 (E. C. 291) EFFECT OF RELEASE OF DEBT OR RELEASE OF JOINT AND SEVERAL LIABILITY 1. in all cases of the release of one of the joint and several debtors either from the debt or from the joint and several liability the other co-debtors may in accordance with Article 285 (52) claim from the co-debtor who has been released his contribution in the share of those co-debtors who are insolvent. 51 2. If, however, the creditor has discharged the co-debtor to whom he has given a release from all liability in respect of the debt, the creditor will bear himself the contribution of such a co-debtor in the share of the insolvent co-debtors. (52) See Article 298 in E.C.

ARTICLE 279 (E. C. 292) PRESCRIPTION 1. If the debt is extinguished by prescription as regards one of the joint and several debtors the other co-debtors will only benefit from this prescription to the extent of the contribution of that co-debtor. 2. If the prescription is interrupted or suspended as regards one of the joint and several debtors, the creditor cannot claim interruption or suspension as regards the other co-debtors.

ARTICLE 280 (E.C. 293) PERFORMANCE AND DEMAND 1. In the performance of an obligation a joint and several debtor is only responsible for his own acts. 2. A formal demand to one of the joint and several debtors or proceedings taken against one of them by the creditor will have no effect against the other co-debtors, but if one of the joint and several debtors issues a formal demand against the creditor, this demand will benefit the other co-debtors.

ARTICLE 281 (E. C. 294) TRANSACTION BETWEEN CREDITOR AND ONE OF JOINT AND SEVERAL DEBTORS A transaction entered into between a creditor and one of the joint and several debtors will benefit the other co-debtors if it involves remission of the debt or the release of the liability in respect thereof in any other way. If such a transaction creates an obligation or increases the existing obligation, it will be binding upon the other co-debtors if they consent thereto.

ARTICLE 282 (E.C. 295) ACKNOWLEDGMENT OF DEBT BY DEBTOR 1. An acknowledgment of debt by one of the joint and several debtors does not bind the other co-debtors. 2. If one of the joint and several debtors refuses to take an oath or if he tenders the oath to the creditor and the creditor takes the oath, the oath refused or tendered will not prejudice the other co-debtors. 3. If the creditor tenders the oath to one of the joint and several debtors and this co-debtor takes the oath, the oath will profit the other co-debtors.

ARTICLE 283 (E.C. 296) EFFECT OF JUDGMENT AGAINST ONE OF JOINT AND SEVERAL CO-DEBTORS 1. A judgment given against one of the joint and several debtors will have no effect against the other co-debtors. 2. If the Judgment is given in favour of one of them it will benefit the others, unless the judgment is based on a ground relating only to the co-debtor in favour of whom the judgment is registered.

ARTICLE 284 (E.C. 297) RECOURSE BY ONE CO-DEBTOR AGAINST THE OTHER 1. If one of the joint and several debtors pays the debt in full he will only have a claim against each of the other co-debtors for each of such co-debtors' own share respectively, even if he exercises the right to action of the creditor by way of subrogation. 2. The amount paid is divisible between the co-debtors in equal parts in the absence of an agreement or a provision of law to the contrary.

ARTICLE 285 (E. C. 298) INSOLVENCY OF ONE OF THE CO-DEBTORS If one of the joint and several debtors becomes insolvent his share shall be borne by the co-debtor who has effected payment and by all the other solvent co-debtors pro rata. 52 AND SEVERAL

ARTICLE 286 (E.C. 299) DEBT CONCERNING ONE ONLY OF THE JOINT DEBTORS and several debtors (53) he will be liable for the whole When the debt concems one only of the joint debt tothe other co-debtors. as follows: (53) Compare Article 1120 of the Quebec Civil Code ted jointly and severally concems only one "If the matter for which the debt has been contrac to hím, towards his co-debtors, who. with regard of the co-debtors, he is liable for the whole are considered as his sureties. 2 Indivisibility

ARTICLE 287 (E. C. 3OO) DEFINITION An obligation cannot be divided: (a) when it has for its object something which by its nature is not susceptible of division; (b) if it is the intention of the parties or it follows from the purpose pursued by the parties that the performance of the obligation should not be divided.

ARTICLE 288 (E. C. 301) PLURALITY OF DEBTORS 1. Where there are debtors in respect of an individual obligation each debtor is liable for the debt in full. 2. A debror who has effected payment will have a remedy against each of the other co-debtors for his part, unless the contrary follows from the circumstances.

ARTICLE 289 (E.C. 302) PLURALITY OF CREDITORS 1. When there are several creditors in respect of an indivisible obligation or several heirs of a creditor in respect of such an obligation each of the creditors or heirs may demand the performance in its entirety of the indivisible obligation. If one of the creditors or heirs contests such a demand the debtor shall effect payment to all the creditors together or deposit the object of the obligation in Court. 2. Co-creditors will have remedies against a creditor who has received payment, each one for his share. 53 Chapter IV Section The Assignment of a Right

ARTICLE 290 (Е.C. 303) RIGHTS CAPABLE OF BEING ASSIGNED A creditor may assign his right to a third party, provided that his claim is not impossible of assignment by reason of a provision of the law, or an agreement between the parties or on account of its nature, The assignment is valid without the consent of the debtor.

ARTICLE 291 (E. C. 304) RESTRICTION UPON ASSIGNMENT OF RIGHT A right can only be assigned to the extent to which it can be attached.

ARTICLE 292 (E. C. 305) EFFECT OF ASSIGNMENT An assignment is not effective as against a debtor or a third party unless it has been accepted by the debtor or notified to him. The acceptance by the debtor does not render the assignment valid as against third parties unless it has an established date,

ARTICLE 293 (E. C. 306) PRECAUTIONARY MEASURES The creditor to whom the assignment is made may, prior to notification of the assignment or to itsacceptance, take all precautionary measures to safeguard the right that has been transferred to hím.

ARTICLE 294 (E. C. 307) CONSEQUENTIAL RIGHTS The assignment of a right comprises its warranties such as sureties, privileges and mortgages, as well as interest and instalments that have fallen due.

ARTICLE 295 (E. C. 308) EXTENT OF OBLIGATION OF ASSIGNOR 1. In the case of an assignment for valuable consideration the assignor, in the absence of an agreement to the contrary, only warrants the existence of the right assigned at the moment of the assignment. 2. When, however, the assignment is not for valuable consideration the assignor does not even warrant the existence of the right.

ARTICLE 296 (1st para, only of E. C. 309) SOLVENCY OF DEBTOR An assignor does not warrant the solvency of the debtor unless such warranty is specifically stipulated.

ARTICLE 297 (E. C. 310) EXTENT OF WARRANTY When assignee exercises his right of recourse in warranty against the assignor, in accordance with the two preceding Articles, the assignor is only liable to restitute that which he has received together with interest and expenses notwithstanding any agreement to the contrary.

ARTICLE 298 (E. C. 311) RESPONSIBILITY OF ASSIGNOR An assignor is responsible for his personal acts, even if the assignment is not for valuable consideration or even if it has been stipulated to be without warranty.

ARTICLE 299 (E.C.312) DEFENCE OPEN TO DEBTOR A debtor of the right assigned may raise, as against the assignee, the defence that he was entitled to raise against the assignor at the time that the assignment became effective against him. He may also raise defences arising from the contract of assignment. 54 (E.C. 313) PLURALITY OF ASSIGNMENTS ARTICLE S00 is given to the assignment In the event of several assignment s relating to the same right preference In is TN effective as regar ds thira parties, ARTICLE S0I (E.C. S4) EFFECTS OF ATTACHMENТ debt assigned, before the assignment has 1 When ar attachment is served upon the debtor of the the assignment is equivalent to an attach ment vis-a-vis became effective as against third parties, raiDet. the assignment becomes effective as against i.Ir this case, if another attachment is made after parbes, the debt will be divided pro rata between the first distrainer, but the amount necessary second distrain er assigned will be deducted p the amount of the sum the assignee and the from the share of the second distrainer and paid to the assignee . Section П Assignment of Debt

ARTICLE 30R (E.C. 315) ASSIGNMENT OF DEBT An assiginent of debt is effected by an agreement between the debtor and a third party who Dndertakes to assume the debt in the place of the debtor. ARTCLE SOS (E.C. 316) RATIFICATION OF ASSIGNMENT BY CREDITOR 1 An assigniment of debt is not effective as against the creditor unless ratified by the creditor. 2. when the person assuming the debt or the original debtor notifies the assignment to the creditor and gives him a reasonable time to ratify the assignment, the assignment will be deemed to have been refused if the creditor does not give his consent before the expiration of such period.

ARTICLE 304 (E.C. 317) OBLIGATIONS OF ASSIGNEE 1 Taol he creditor has signified his ratification or refusal of the assignment the person assuming the debt will, in the absence of an agreement to the contrary, be responsible to the original debtor to effect payment on due date to the creditor. This rule applies even when the creditor has refused the assigninent. 2 The original debtor cannot, however, call upon the person assuming the debt to make payment to the creditor so long as he has not himself discharged his obligation to the person assuming the debt in accordance with the contract of assignment.

ARTICLE 305 (E.C. 318) CONSEQUENTIAL RIGHTS ATTACHING TO DEBT TRANSFERRED 1 The debt assigned is transmitted with all its warranties. 2. The surety, whether real or personal, does not remain bound to the creditor unless he has agreed to the assignment.

ARTICLE 306 (E.C. 319) WARRANTY OF SOLVENCY in the absence of an agreement to the contrary the original debtor warrants the solvency of the person assuming the debt at the moment the creditor ratifies the assignment. ARTICLE З07 (E.C.320) DEFENCE WHICH ASSIGNEE MAY RAISE A person assurming debt may raise against the creditor the defence which the original debtor was entitled to raise. He may also raise the defences arising out of the contract of assignment.

ARTICLE 308 (E.C.320) AGREEMENT BETWEEN CREDITOR AND ASSIGNEE 1 An assigoment of debt may also take place between the creditor by an agreement that and the person assuming the debt provides that such person replaces the original debtor in his obligati on. 2. in such a case the provisions of Article s 305 and 307 (54) will be applicable. (54) E.C. 138 and 320. 55

ARTICLE 309 (E. C. 322) SALE OF MORTGAGED REAL PROPERTY 1. The sale of a mortgaged immovable property does not imply the transfer of the mortgage debt to the purchaser unless the agreement provides for such a transfer. 2. If the vendor and the purchaser agree to assign the debt and if the deed of sale is transcribed the creditor should, after notification to him by legal process of the assignment, ratify or refuse the assignment within a period not exceeding six months. If he maintains silence up to the end of this period such silence is equivalent to ratification. 56 Chapter V tions The Extinction of Obliga Section I Payment 1. The Two Parties to Payment (E.C.323) PAYMENT

ARTICLE 310 other interested party, 1. Payment (55) may be made by the debtor, by his representa tive or by any subject to the provisions of Article 211. (56). 2. Payment may also, subject to the provisions of Article 211, be made by a third party who is not interested in such payment, even without the knowledge or against the wish of the debtor, but the creditor may refuse payment tendered by a third party if it is opposed by the debtor and the debtor has informed the creditor of his opposition. (55) By payment is meant not only the delivery of a sum of money in satisfaction of an obligation but the performance of anything to which the parties are respectively obliged. Vide Quebec Civil Code Article 1139. (56) E.C.208.

ARTICLE 311 (E. C. 324) PAYMENT OF DEBT BY THIRD PARTY 1. If a third party pays off the debt such third party shall have a remedy against the debtor up to the amount that he has paid. 2. The debtor, against whose wish payment has been made, may contest the claim made against him by the person who has made the payment on his behalf as regards all or part of the payment made, if he shows that he had any interest whatsoever in opposing the payment.

ARTICLE 312 (E. C. 325) CONDITIONS FOR VALIDITY OF PAYMENT 1. Payment is only valid if the person who made the payment is the owner of that with which he has paid the obligation and has the capacity of disposing of it. 2. When payment of that which is due is made by a person without the necessary legal capacity to dispose of the thing with which payment is effected it extinguishes the obligation provided that it does not prejudice the person who has paid.

ARTICLE 313 (E. C. 326) SUBROGATION When payment is made by a third party such third party is subrogated in the rights of the creditor who is paid off in the following cases:- (a) When such third party was liable for the debt jointly with the debtor or was under an obligation to pay the debt on his behalf; (b) When such third party, being himself a creditor, even an unsecured creditor, had paid another creditor ranking before him by reason of a real security; (c) When, having acquired an immovable, he has paid the price to creditors having upon the immovable in question; a real security (d) When the law expressly gives him the right of subrogation.

ARTICLE 314 (E. C. 327) SUBROGATION OF ANOTHER IN PLACE OF CREDITOR A creditor who receives what is due to him from a third party may, by agreement with the subrogate such third party into his rights even third party. if the debtor does not agree to the agreement must not be concluded subrogatio n. The after the time of payment (57). 57 (57) Compare the French Civil Code, Article 1250. "Subrogation takes place by virtue of an agreement (1) when the creditor having been paid off by a third party puts him into his, the creditor's, shoes as regards his rights, rights of action, príorities or mortgages. Such subrogation must be express and effected by the time of payment. (2) When the debtor borrows a sum in order to pay his debts and to subrogate thereby the lender in the rights of the creditor.

ARTICLE 315 (E.C. 328) SUBROGATION OF LENDER IN PLACE OF CREDITOR A debtor may also, when he has borrowed a sum with which he has paid the debt subrogate the lender into the rights of the creditor who received the payment, even without the consent of the creditor, provided that in the contract of loan it is stated that the sum in question was borrowed for the purpose of effecting the payment and that in the receipt in discharge it is stated that the payment was made with the money lent by the new creditor.

ARTICLE 316 (E. C. 329) EFFECTS OF SUBROGATION A third party subrogated in law or by agreement in the rights of the creditor is substituted for the creditor as regards the debt to the amount of the sums that he has himself paid with all the attributes of the debt and all accessories, securities and defences attached to the debt.

ARTICLE 317 (E.C. 330) PARTIAL SUBROGATION 1. In the absence of an agreement to the contrary, when a third party pays part of a debt to a creditor and is subrogated into the rights of the creditor as regards such part, the creditor shall not be prejudiced by such partial payment and may exercise his rights for that which remains due, in preference to the third party. 2 When a further third party is subrogated in the rights of the creditor, as regards that which remains due to this creditor, this further third party so subrogated, together with the third party subrogated before him, will have a right to claim what is due to each of them pro rata,

ARTICLE 318 (E. C. 331 ) SUBROGATION OF MORTGAGEE OF IMMOVABLE PROPERTY IN PLACE OF CREDITORS A third party holder of a mortgaged property who has paid all the mortgage debt and has been subrogated into the rights of the creditors, shall only have the right, by reason of such subrogation, to claim from the holder of another property mortgaged for the same debt the share of that holder in the debt proportional to the value of the immovable held by him.

ARTICLE 319 (E.C. 332) TO WHOM PAYMENT SHOULD BE MADE Payment shall be made to the creditor or to his representative. A person who produces to the debtor a receipt in discharge issued by the creditor is deemed to be qualified to receive payment unless it has been agreed that payment shall be made to the creditor in person.

ARTICLE 320 (E.C. 333) PAYMENT TO OTHER THAN THE CREDITOR OR HIS REPRESENTATIVE Payment to someone other than the creditor or his representative does not free the debtor of his obligation unless the payment is ratified by the creditor, or profits the creditor and then only to the extent of such profit, or unless the payment was made in good faith to a person holding the title to the debt.

ARTICLE 321 (E. C. 334) REFUSAL OF CREDITOR TO ACСЕРТ PAYMENT When a creditor refuses, without good reason, to accept payment that is regularly offered to him, or to do such things without which payment cannot be made, or declares that he will not accept payment, he will be deemed to have been duly summoned to accept payment from the time that such refusal is recorded by a summons notified to him by legal process.

ARTICLE 322 (E.C. 335) EFFECT OF REFUSAL From the time that a summons has been served on a creditor he shall be responsible for the loss or the deterioration of the thing and interest on the debt ceases to runs the debtor shall then have the compensation for any right to place the thing in safe keeping at the cost of the creditor and claim damage he may have suffered. 58 SAFE-KEEPING (E.C. 336) PLACING THING IN

ARTICLE 323 specific thing which must be deli verec a When the subject matter of the payment is a definite and dei ted, the debtor may, after havi ng summoned the creditor to take vent the place where it is situa ping. If the thin g ques tion is an imso t to place it in safe-kee in obtain an order of the Cour or may ask for it to be plac ed under Judicial eustv. place the debt or a thing intended to rema in in SALE BY PUBLIC AUCTIO N

ARTICLE 324 (E.C. 337) things of a rapidly peristtg of the Judge, sell by piblic auction 1. The debtor may, by permission ng or custody, and deposit sitate an exorbitant expen ditur e for safe- keepi nature or movables that neces the price in the Treasury of the Court. the market or is quoted on the stock exchange it may only 2. When the thing has a known price on the marke t or quoted price. ible to sell it by agreement be sold by public auction if it is imposs at IT (58)

ARTICLE 325 (E.C. 338) OTHER PERMISSIBLE REASONS FOR DEPOS Deposit or any other equivalent measure is also permissible if the debtor does not know the persor or the domicile of the creditor , heing totally or partially incapable, has not a representative to persons, or is the object of a dispute between several accept payment on his behalf, or if the debt if there are other serious reasons which justify this measure. third party or deposit in (58) Deposit is used here to cover deposit in safe-keeping with a the Treasury of the Court.

ARTICLE 326 (E.C. 339) EFFECT OF ACTUAL TENDER OF THING The actual tender (59) of the thing due is equivalent to payment, in so far as the debtor is concemed, when it is followed by a deposit made in the manner prescribed in the Civil and Commercíal Procedure Code, or by any other equivalent measure, provided that it is accepted by the creditor or recognised as valid by a final judgment. (59) Tender includes the performance of the contract and includes offers to do anything necessary.

ARTICLE 327 (E. C. 340) RETRACTION OF TENDER 1. A debtor who has made a tender of the debt followed by a deposít, or by an equivalent measure, may retract his tender so long as it has not been accepted by the creditor, or so long as it has not been recognísed as valíd by a final judgment, in which case the co-debtor and sureties will be freed, 2. If a debtor retracts his tender after its acceptance by the creditor or after it has been declared valid by a judgment, and his withdrawal is accepted by the creditor, the creditor shall no longer have the right to avail himself of the securities guaranteeing his right and the co-debtors and the sureties shall in such case be released. 2. Means of Payment

ARTICLE 328 (E. C. 341) MEANS OF PAYMENT Payment must be made with the very thing due. The creditor cannot be forced to accept anything else, even if the value of such other thing is equal or greater.

ARTICLE 329 (E. C. 342) PART PAYMENT 1. In the absence of an agreement or a legal provision to the contrary the debtor cannot force his creditor to accept a partial payment of his debt. 2. If, in a case where part of the debt is contested, a creditor agrees to receive payment of that part of the claim which is admitted, the debtor cannot refuse to pay the part that is admitted.

ARTICLE 330 (E. C. 343) PAYMENT OF DEBT AND EXPENSES ATTACHED THERETO When a debtor is under an obligation to pay expenses and interest in addition to the principal of the debt and makes a payment which does not cover the principal and these accessories, the payment shall, unless otherwise agreed, be imputed, in the first instance, to expenses, then the interest and lastly to principal. 59

ARTICLE 331 (E. C. 344) PLURALITY OF DEBTS If a debtor owes the same creditor several debts of the same kind and if the payment made by him does not suffice to cover all the debts, he has the right to indicate, when effecting payrment, the debt which he intends to discharge, provided that he is not prevented from so doing by law or by agreement.

ARTICLE 332 (E. C. 345) ORDER OF PAYMENT OF VARIOUS DEBT'S Failing any indication by the debtor as provided for in the preceding Article, the payment shall be imputed to the debt that has fallen dues in a case where several debts have fallen due, to the most onerous debt, in a case where the debts are all equally onerous, to the debt indicated by the creditor.

ARTICLE 333 (E. C. 346) TIME FOR PAYMENT FALLING DUE 1. In the absence of an agreement or of a provision of the law to the contrary, payment must be made as soon as the obligation has been definitely created as a liability of the debtor. 2. The Judge may in exceptional cases and in the absence of a provision of the law to the contuary, grant to the debtor, when his position so requires, one or more reasonable delays for the performance of his obligation, provided that no serious prejudice is thereby caused to the creditor.

ARTICLE 334 (E. C. 347) PLACE OF PAYMENT 1. In the absence of an agreement or of a provision of the law to the contrary, when the subject matter of the obligation is a definite and ascertained thing, it should be delivered at the place it was situated at the time the obligation was created. 2. In the case of other obligations payment is due at the debtor's domicile at the time of payment or at his place of business if the obligation is connected with such business,

ARTICLE 335 (E. C. 348) EXPENSES IN CONNECTION WITH PAYMENT In the absence of an agreement or a provision of the law to the contrary, expenses in connection with payment are at the charge of the debtor.

ARTICLE 336 (E. C. 349) RELEASE 1. A person who pays part of a debt has the right to demand a receipt for the amount he has paid and a note showing the payment on the document of title of the debt. He has also the right, at the time the debt is paid in full, to demand the restitution or the cancellation of the document of title. If this document has been lost the debtor may demand a written declaration from the creditor that the document of title has been lost. 2. If the creditor refuses to comply with the conditions laid down in the preceding paragraph the debtor may place the object due in judicial custody. Section П Methods of Extinction of the Obligation Equivalent to Performance 1. Giving in Payment (60) (60) Nothing hinders the creditort from consenting to take something different from the thing which he had at first stipulated. If he does so, there is said to be a "giving in payment".

ARTICLE 337 (E.C.350) WHAT MAY STAND IN PLACE OF PAY MENT When a creditor accepts in settlement of his right another prestation in place of that which is due, this giving in payment takes the place of payment. 60 PAYMENT ISIONS AS TO GIVING IN SPECIAL PROV

ARTICLE 398 (E.C. 351) legal capacity of ch relate to the ating to sal e, especially those whi "giving in payment" in cases ions of the law rel hidden defects, apply to The provis and e provisions t against evi cti on prestation due. Th the the parties, warran ng given in place of tion of sums pai d and ownership of the thi to the imputa where it transfers the ecially those which relate uishes of the law rel ating to payment, esp so far as "gi ving in payment" exting also applicable in ext inc tio n of warranties, are to the the debt. Novation and Delega tion 2. (E. C. 352) NOVATION

ARTICLE 339 There is novation of an obligation: to substítute a new obligation for the the two parties agree 1. by a change of the debt, when origi nal obli gati on as regards its original obligation, which new obligation differs from the object or as regards its sourc e. that such third party creditor and a third party agree by a change of the debtor, when a debtor shall be released of 2. the nal debtor and that the original shall take the place of the origi r has procu red the consent of the sary, or when the debto debt without the consent being neces the new debtor. third party who consents to be creditor to substitute the debtor by a r, the debtor, and a third party agree that this 3. by a change of the creditor, when the credito third party shall be the new creditor.

ARTICLE 340 (E.C. 353) CONDITIONS FOR NOVATION and the new obligation, 1. Novation can be effected only if the two obligations, the original are free from any grounds of nullity. 2. voidable contract, the novation is only valid if the If the original obligation results from a new obligation has been assumed both with a view to confirming the contract and to replacing the original obligation.

ARTICLE 341 (E. C. 354) PRESUMPTION OF NOVATION 1. Novation is not presumed; it must be expressly agreed or result clearly from the circumstances. 2. In particular, novation does not result, in the absence of an agreement to the contrary, from the subscription of a promissory note in respect of a pre-existing debt, from changes that relate only to the date, place or mode of performance of the prestation, or from modifications made to the obligation only as regards securities or as to the rate of interest.

ARTICLE 342 (E.C. 355) CURRENT ACCOUNT 1. The mere entry of the debt in current account does not effect novation. 2. There is, however, novation when the balance of a current account has been fixed and agreed; if, however, the debt was guaranteed by means of a special security, that security is maintained unless otherwise agreed.

ARTICLE 343 (E.C. 356) EFFECTS OF NOVATION L Novation has the effect of extinguishing the original obligation with its accessories and of substituting for it a new obligation. 2. Securities which guaranteed the performance of the original obligation are not transferred to the new obligation, unless the law provides otherwise, or unless it appears from the agreement or the circumstances of the case that such is the intention of the parties.

ARTICLE 344 (E. C. 357) REAL SECURITIES If the debtor has given real securities in guarantee of the original obligation, the following conditions will be observed in the agreement providin g for the transfer of these securities to the new obligation: 138 within whose jurisdiction the (96) In E.C.: "by the President of the Court of First Instance building is situated." 2. The manager of the syndicate shall represent the syndicate before the Courts, even agains the owners if need be.

ARTICLE 871 (E.C.867) REMUNERATION AND DISCHARGE OF MANAGER 1. The remuneration of the manager of the syndicate will be fixed in the decision or order appointing him. 2. The manager of the syndicate may be discharged by a decision taken by the majority of the co-owners, as laid down in Article 868, or by an order of the President of the Court of Firx Instance within whose jurisdiction the building is situate, after the co-owners have been summoned to be heard on the question of his discharge.

ARTICLE 872 (E.C.868) DETERIORATION OF BUILDING 1. If the building is destroyed by fire or otherwise, the co-owners are, subject to any agreemem to the contrary, bound to conform to the decision of the syndicate as to its reconstruction taken by the majority, as provided in Article 868. 2. If the syndicate decides to reconstruct the building, any amount due as compensation on account registered creditors, be of the destruction of the building shall, without prejudice to the rights of the set aside for the costs of reconstruction.

ARTICLE 873 (E.C. 869) LOANS AND SECURITY THEREFOR 1. Any loan made by the syndicate to one of the co-owners, in order to assist him to carry out hs obligations, will be secured by a privileged charge on his divided part as well as on his undivided share in the parts of the building held in common. 2. The rank of this privilege will date from its registration. Section П Acquisition of Ownership Acquisition by Appropriation The Appropriation of Movables without an Owner

ARTICLE 874 (E.C.870) ACQUISITION BY TAKING POSSESSI ON Whoever takes possession of a movabl e which has no owner, with the intent acquires the ownership thereof. ion of its appropriation.

ARTICLE 875 (E.C. 871) MOVABLE HAVING NO OWN ERS 1. A movable is deemed to have no owner when its owner aband of renouncing his ownership theret ons possession of it with the intentioa o. 2. Animals, other than domestic animals, are deemed to have no owner If one of such animals, after losing as long as they are at libert its liberty, regains its freedom, it becom y. owner does not seek for it immed es without an owner if the iately or ceases to seek for it. An animal that has become tame and is accustomed to return to the same place becomes again without an owner if it loses this habit. 139

ARTICLE 876 (E.C.872 but para. 3 is added in Libyan Code) TREASURE 1. Buried or hidden treasure to which no one can establish ownership helongs to the owner or the owner of the property on which it bare is discovered. 2. Treasure discovered on waqf prope rty belongs to the founder of the waqf or his heirs. 3. If a person by mere chance finds treasu re among property belonging to another it shall be divided equally between him and the owners.

ARTICLE 877 (E. C. 873) HUNTING AND THINGS FOUND Rights of fishing and hunting and rights to things found and to antiquities, are governed by special regulations. The Appropriation of Immovables which have no Owner

ARTICLE 878 (Paras. 1 and 2 only of E.C.874) UNCULTIVATED LAND 1. Uncultivated land which has no owner is the property of the State. 2. The appropriation or the possession of uncultivated land can only be effected with the authority of the State in accordance with the regulations. Acquisition by Inheritance and Winding Up of an Estate

ARTICLE 879 (E.C.875) APPLICATION OF ISLAMIC LAW AND SPECIAL LAWs 1. The establishment of the heirs, of their hereditary shares and of the devolution of the property of the estate on them is governed by Islamic Law and by the laws with regard to inheritance and estates. 2. The following provisions apply to the winding up of an estate. Appointment of Administrator (97)

ARTICLE 880 (E.C.876) APPOINTMENT OF ADMINISTRATOR In the absence of the appointment of a testamentary executor by the deceased, the Court may, at the request of an interested party,if it considers it necessary to do so, appoint an administrator of the estate a person chosen unanimously by the heirs. In the absence of unanimity, the Judge will, after having heard the heirs, choose an administrator, if possible from amongst the heirs. (97) The word used in Arabic corresponds to "liquidator".

ARTICLE 881 (E.C.877) RENUNCIATION BY AND REMOVAL OF ADMINISTRATOR 1. A person appointed administrator may decline to act or may, after having acted as administrator, renounce the appointment in accordance with the provisions of the mandate. 2. The Judge may also, for adequate reasons, either at the request of any of the interested parties or at the request of the Parquet, or on his own initiative, discharge an administrator and replace him by another.

ARTICLE 882 (E.C. 878) CONFIRMA TION BY JUDGE OF APPOINTMENT OF EXECUTOR 1. The appointnient of a testamentary executor by the deceased must be confirmed by the Judge. 2. The rules applicable to an administrator of an estate apply equally to a testamentary executor. 144

ARTICLE 912 (E.C. 908) WILL DIVIDING PROPERTY OF ESTATE A will dividing the property of the estate between the heirs of the testator and setting out the share of so given to one of them exceeds each heir or of certain of the heirs is valid. If the value of the share a legacy by will. his hereditary share, the excess is deemed to be

ARTICLE 913 (E.C. 909) DISPOSITION "MORTIS CAUSA" A division made by disposition "mortis causa" may always be revoked. It becomes irrevocable on the death of the testator.

ARTICLE 914 (E. C. 910) PROPERTY NOT INCLUDED IN DISPOSITION "MORTIS CAUSA" If such a division does not include all the property of the deceased at the date of his death, that property which has not been included in the division devolves in common on the heirs in accordance with the rules as to inheritance.

ARTICLE 915 (E.C. 911) HEIR PREDECEASING DECEASED If one or more of the contingent heirs included in the division predecease the deceased, the divided part allotted to him or them devolves in common on the other heirs in accordance with the rules as to inheritance.

ARTICLE 916 (E. C. 912) PROVISIONS AS TO DISPOSITION "MORTIS CAUSA” The general rules as to division, with the exception of those relating to lesion, apply to division made by disposition "mortis causa".

ARTICLE 917 (E.C.913) DIVISION OF DEBTS OF ESTATE If the debts of the estate are not included in the division, or if these debts are included and the creditors do not agree to the division, any heir may, if these debts are not settled in agreement with the creditors, call for a division of the estate in accordance with Article 899 (103). In this case, account must be taken, as far as possible, of the division made by the deceased and the considerations which guided him as regards such division. (103) Art. 895 in E. c. Rules Applicable to Estates that have not been Wound Up

ARTICLE 918 (E.C. 914) RIGHTS OF CREDITORS When an estate has not been wound up in accorda nce with the preceding provisions, the unsecur creditors of the estate may take action, in ed respect of their claims or of their legaices, on the immovable property of the estate which has been alienated or which has been charged with real rights to the benefit of third parties, provided that they have recorded such claims in accordance with the provisions of the law. Acquisition by Will

ARTICLE 919 (E. C. 915) PROVISIONS AS TO WILLS Wills are governed by the rules of Islamic Law and by laws on wills.

ARTICLE 920 (E.C. 916) DISPOSITIONS DURING ILLNESS PREC EDING DEATH 1. Every legal disposition made by a person during an illness immediat the object of making a gift, ely preceding his death, with is deemed to be a test amentary disposition and must be rules applicable to wills, no matter what descr iption has been given to such governed by the an act. 2. The heirs of the person who has made such a legal dispo onus of proving that sition are the persons on whom it was made by the dece ased during an illness imm falls the This proof may be tend ediately preceding his ered in any way and the death. disposition cannot be inv date of the legal instrumen oked against the heirs, t establishing the unless it is an established date. 3. If the heirs establish that the legal disposition immediately preceding his was made by the deceased during an illn death, the act is deemed ess to be a gift (i.e unless the beneficiary . a testamentory disposition) special provisions proves that the cont to the contrary. rary was the case. The above provisions . are subject to any 180 2. The privilege of a co-partitioner has the same rank as a vendor's privilege. Should the movable in question be subject to both rights, the first in date will have priority. Special Privileges Over Immovables

ARTICLE 1151 (E. C. 1148) PRIVILEGE OF CONTRACTORS AND ARCHITECTS 1. Sums due to contractors and architects who have been entrusted with the erection, reconstruction, repair or maintenance of buildings or other works, have a privilege over such works but only in respect of the increase in value resulting from such works as at the time of the alienation of the immovable. 2. Such prívilege must be inscribed: its rank is fixed by the date of its inscription.