Kuwait Court of Cassation principle number 413

Summary: - The provisions of the Companies Law. Intended to achieve a general economic interest. Their connection with public policy. Its consequence. Although the effects of a transaction concluded under the old Companies Law are, in principle, governed by the law under which it was concluded, since Decree-Law 25 of 2012 concerning Companies(*) reached those effects before they were determined by a final judgment, it applies to them. - The enactment of Companies Law No. 25 of 2012 (*) and its provision for the lapse of all terms for payment of debts owed by a company if it is dissolved. Its consequence. The lapse of all debts owed by the respondent company whose dissolution and liquidation were ordered, including the loan in dispute, which was agreed to be repaid from its profits after their realization, so that repayment becomes due. Departing from this and ruling that the action is inadmissible because it was brought prematurely. An error vitiating the judgment and requiring its cassation. Rule: It is established that, although the provisions of the Companies Law concern individuals, they are intended to achieve a general economic interest connected with society's higher order and taking precedence over the interests of individuals, consisting in the fact that they represent the State's economic structure and that their collapse would prejudice and affect it. Although the transaction in dispute was concluded under the old Companies Law and its effects are in principle governed by the law under which it was concluded, since the rules of the Companies Law are matters of public policy, as stated above, Decree-Law No. 25 of 2012 concerning Companies, published on 29/11/2012, applies to the present action, having reached it before its determination by a final judgment. The import of Article 310 of the aforementioned Decree is that all terms for payment of debts owed by the respondent company lapse, its dissolution and liquidation having been ordered by the judgment rendered in Appeal No. 1526 of 2011 Commercial. These include the loan in dispute, which was agreed to be repaid from its profits after their realization. Accordingly, this debt—amounting to 185000 dinars under the assignment of the right issued by the person named ........ - the appellant—has become due and must be repaid. Since the challenged judgment departed from this view and ruled that the action was inadmissible because it was brought prematurely, it is defective in a manner requiring its cassation.