Kuwait Court of Cassation principle number 2372

Amendment of the company’s contract and conversion of its legal entity into a limited liability company. Inclusion in the contract of broad powers for its manager and authority to conclude contracts, agreements and transactions relating to the company’s dealings. Establishment that the prohibition imposed on him is confined to the impermissibility of his selling or mortgaging the company’s real property or - 439 - Obligation - providing guarantees or contracting loans without a collective resolution of the partners. His assignment of a contract for exploitation of an industrial plot, together with the buildings thereon and the movables it contains, in exchange for another company’s waiver of a debt owed to it by his company, and the State’s approval of the assignment. Its import. Expiry of that contract and the inevitable fate of the structures erected on the plot becoming severance; they are deemed movables by anticipation, disposal of which falls within the manager’s powers. The challenged judgment’s conclusion that his disposal entails a sale of real property without a collective resolution of the partners, contrary to the prohibition contained in the contract, and its consequent finding that the disposal is void. An error in the application of the law and unsound reasoning.