Kuwait Court of Cassation principle number 2896

A business establishment. Its inclusion of tangible and intangible elements. Their nature. Restriction of the sale of a business establishment to some of these elements. Its treatment as a sale of the commercial establishment. Its condition. The sale must include the principal elements, particularly customer connections and commercial reputation, and assignment of the leasehold right where the location is the basis of its reputation and numerous customers. Restriction of the sale to non-essential elements. Not regarded as a sale of the commercial establishment. This is not altered by the contracting parties' statement that the sale concerned the business establishment. - Determining whether the elements to which the sale of the business establishment related are essential or not. For the trial court. In ascertaining the true nature of the contract, it may investigate the disposing party's intent, assess the evidence and presumptions submitted, and draw the conclusions it finds convincing. The condition therefor. - Characterization of whether the sale is a sale of a commercial establishment or a sale of some of its non-essential elements. A question of law. Subject to review by the Court of Cassation. - Official form is an essential element in the conclusion of a sale of a business establishment. Its absence and its effect. Absolute nullity of the contract, whether as regards the contracting parties or third parties. It may be invoked by any interested person, and the court may rule thereon of its own motion. Articles 34, 26/1 of the Commercial Code, 184, Civil Code. An example. - 563 - Sale