Kuwait Court of Cassation principle number 93

Summary: - The principal's exemption of the agent from performing the obligation to render an account of his agency activities. A juridical act. It may be implied through ratification of his acts in all his affairs within the scope of the agency without rendering an account thereof. The effect of this expression of intent continues throughout the duration of the agency and after its termination. The agency does not terminate by reason of the principal's illness, even if severe. The continued effect of the exemption constitutes a presumption of continuity of the existing state, applying the foundational rule that what existed remains as it was. - Loss of capacity by either party to the agency contract, including the absence of perception and discernment in a state of unconsciousness. One of the grounds for termination of the agency, applying the rule linking capacity to act with perception and discernment. What matters in this regard is permanent loss of capacity, whereby legal positions become settled, rather than incidental or temporary loss. The basis thereof: the legislature's association of loss of capacity, as a ground for termination of agency, with the death of either party thereto. Assessment of whether loss of capacity is permanent or incidental, such as to require termination of the agency. A matter of fact. Rule: It is established in this Court's jurisprudence that, pursuant to Article 706 of the Civil Code, the agent's obligation to render an account of his agency activities does not lapse unless the principal exempts him clearly and unequivocally, or the nature of the transaction or the circumstances call for such exemption. Determining the existence or absence of an agreement on exemption, or the circumstances that called for it, is a question of fact independently determined by the court of merits, which may base its ruling on inferences drawn from the facts of the case. Its assessment of those inferences and the weight it assigns them are not subject to review, provided that its reasoning is sound and capable of leading to the conclusion drawn therefrom. Pursuant to the first paragraph of Article 36 of the Civil Code, an expression of intent exists as soon as it is issued by its maker and takes effect upon coming to the knowledge of the person to whom it is addressed. The principal's exemption of the agent from performing the obligation to render an account of his agency activities is a juridical act in which the principal expresses his intent, even implicitly, to exempt the agent and ratify his acts in all his affairs within the scope of the agency without rendering an account thereof, treating them as if issued by himself. The effect of this expression of intent continues throughout the duration of the agency and after its termination. It does not legally terminate by reason of the principal's illness, even if severe. The continued effect of the exemption in this case constitutes a presumption of continuity of the existing state, pursuant to the foundational rule that what existed remains as it was. Although one of the grounds for termination of agency pursuant to Article 716 of the Civil Code is the loss of capacity by either party to the agency contract, including the absence of perception and discernment in a state of unconsciousness, applying the general rules linking capacity to act with perception and discernment, what matters in this regard is permanent loss of capacity, whereby legal positions become settled in a manner permitting rulings to be based upon them, rather than incidental, temporary loss. This is indicated by the legislature's association of loss of capacity, as a ground for termination of agency, with the death of either party thereto. Assessment of whether loss of capacity in this case is permanent or incidental, such that the agency must or need not terminate, is a factual matter varying from one situation to another. That being so, the first-instance judgment, affirmed and supplemented by the challenged judgment, based its dismissal of the action on the fact that the respondent had acted as agent for his father, the deceased, for nearly ten years, and had never previously rendered an account of his agency activities to his father, nor had the latter demanded this of him, owing to their relationship, which inspired his trust. Neither the papers nor the report of the expert appointed therein established any shortcoming or fault on the respondent's part or any sums owed by him to the principal. The latter judgment added that the deceased's illness occurred during the final period of his life and had no effect on his expression of intent to grant exemption throughout the agency period, since that intent remained unchanged under the presumption of continuity of the original state, and that the appellant had not provided conclusive evidence that the deceased's medical condition was permanent during the agency's operation and until his death. It consequently inferred that the principal had previously exempted him from rendering an account of his agency activities, and therefore dismissed her action, in which the dispute was confined to the respondent's obligation to submit a statement of account of his agency activities for the deceased of the aforementioned person and the claim for certain sums as a consequence of that agency. These are sound reasons falling within the discretionary authority of the court of merits, sufficient to support the judgment's ruling and containing an implicit answer disposing of the contrary defenses raised by the appellant. The criticism on these grounds thus amounts to factual argument beyond this Court's review and is unfounded.