Kuwait Court of Cassation principle number 1693

A limited liability company. Its termination upon expiry of its term specified in its memorandum of association. Its number of partners falling below two. Its effect: its dissolution by operation of law. Articles 185/2 and 215 of Commercial Companies Law 15 of 1960. - 295 - Commercial - It being established that the company in dispute is a limited liability company consisting of two partners and that its term was set at two years. The appellants' predecessor expressing his wish not to renew it and formally notifying the other partner of that wish. Its effect: termination of the company by operation of law. The impermissibility of invoking the company's extension pursuant to Articles 190 and 190 bis of the Companies Law following their amendment by Law 6 of 2001. The reason for that. - The provision of Article 190 of the Companies Law permitting the extension of a limited liability company's term, before its expiry, for any further term by a resolution issued by any number of partners holding more than half of its capital does not restrict a partner's right, in a company consisting of two persons, to withdraw from it where his partner owns more than half of its capital. The reason for that. - Issuance of a general meeting resolution extending the company's term. Its condition: that it not restrict the partner's right to withdraw from it. A limited liability company consisting of two persons. A general meeting resolution issued by one partner as the owner of more than half of its capital. Ineffective in continuing it if his partner has expressed his wish not to renew its term. Its effect: its dissolution by operation of law. - The provision of Article 190 of the Companies Law before its amendment. Its application to limited liability companies whose terms had expired by the time the amendment came into force and which were still conducting the business for which they were formed. The challenged judgment's contravention of that and its reliance on the general meeting resolution issued by the first respondent alone extending the company's term by 25 years, without regard to his partner's wish to terminate it, the established death of the latter, and the absence from the company's memorandum of association of a provision for its continuation with the heirs. A violation of the law requiring its cassation.