Article 357 of the Saudi Civil Transactions Law
المادة 357 من نظام المعاملات المدنية · الفرع الرابع: بيع النائب لنفسه
A sale by a representative, intermediary or expert to himself does not take effect against the owner unless he approves it, while a good-faith specific successor who acquired a real right for consideration is protected.
Official text (Arabic)
This article has not been amended since the law was issued.
إذا تمَّ البيع في الأحوال المنصوص عليها في المادة (السادسة والخمسين بعد الثلاثمائة) من هذا النظام، لم ينفذ في حق من تم لحسابه إلا إذا أجازه، وليس له أن يحتج بعدم نفاذ البيع تجاه الخلف الخاص إذا كسب هذا الخلف حقًا عينيًا معاوضة بحسن نية.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 357 explained in plain English
This article sets out the effect of breaching the bar in Article 356, which bars a representative from buying for himself what he was entrusted to sell, in his own name or another's even by auction, unless he is permitted, and likewise bars an intermediary, an expert and those in the same position.
First effect: no effect without approval. If the sale is made in these cases, it does not take effect against the person for whose account the sale was made, that is, the owner of the property, unless he approves it. The owner has a choice:
- to approve the sale if he sees it as in his interest, and it then takes effect;
- or not approve it, and it does not take effect against him.
Second effect: protection of the specific successor. The owner may not invoke the non-effectiveness of the sale against a specific successor, who is one to whom a right in the item passed from the representative-buyer, if three conditions come together in him:
- he acquired a real right in the item;
- he did so for consideration;
- he is in good faith.
The rationale is that a person who dealt in good faith and paid consideration should not be harmed by a breach to which he was not a party.
Article 358 deals with a related but stricter case, as it bars a judge, a member of the public prosecution and those in the same position, and a court employee from buying the disputed right, and bars a lawyer from doing so where he is the agent in it, and makes the contract void.
To assess the most suitable choice between approving and not approving, it is advisable to consult a lawyer specialized in civil cases.
Practical example
A company in Jeddah appointed an intermediary to sell a warehouse, and the intermediary bought it for himself without permission, and then sold it to an investor who paid its price without knowing what had happened. The company may refuse to approve the sale to the intermediary, but it cannot invoke the non-effectiveness against the investor because he acquired a real right for consideration in good faith.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 357 of the Saudi Civil Transactions Law
What is the ruling on an agent selling to himself what he was appointed to sell, without permission?
It does not take effect against the owner of the property unless he approves it.
Can the owner recover the property from a person who bought it from the agent?
He may not invoke the non-effectiveness against the specific successor if he acquired a real right for consideration in good faith.
May the owner accept the sale?
Yes. If he approves it, it takes effect against him.
Articles this article refers to
More articles on Sale Contract
- Article 23
The article defines consumable things as those whose use, according to what they are prepared for, is limited to consuming or spending them, and treats everything prepared in stores for sale as consumable.
الأشياء القابلة للاستهلاك هي التي ينحصر استعمالها -بحسب ما أُعدّت له- في استهلاكها أو إنفاقها، ويعد قابلًا للاستهلاك كل ما أعد في المتاجر للبيع.
- Article 44
Paying earnest money gives only the payer the right to withdraw from the contract without recovering it, unless otherwise agreed; the court sets the withdrawal period if the parties have not.
1- دفع العربون عند إبرام العقد يفيد أن لدافع العربون وحده الحق في العدول عن العقد، وليس له إذا عدل أن يسترد مبلغ العربون، وذلك كله ما لم يتفق على خلافه. 2- إذا
- Article 109
The article provides that exchange contracts are concluded on the basis that the subject matter is free of defects except what custom tolerates, and that an intolerable defect is a breach of the obligation.
تُعدُّ عقود المعاوضات منعقدةً على أساس سلامة محل العقد من العيوب إلا ما جرى العرف على التسامح فيه، فإذا تبيَّن في المحل عيبٌ لم يجر العرف على التسامح فيه؛ عُدَّ
- Article 165
The article provides that a right to a thing specified by kind attaches to a particular item only once it is set apart, and lets the creditor, on non-performance, obtain a like item at the debtor's expense.
1- إذا تعلق الحق بشيء معين بالنوع لا بالذات، فإنه لا يختص بشيء بذاته من ذلك النوع إلا بإفرازه. 2- إذا لم يقم المدين بتنفيذ التزامه جاز للدائن أن يحصل على شيء من
- Article 166
The article places the risk of destruction or damage on the debtor who failed to deliver, in two cases: transfer of a real right and an obligation to perform work involving delivery, each on different conditions.
1- الالتزام بنقل حق عيني يتضمن الالتزام بتسليم الشيء والمحافظة عليه حتى تسليمه، فإذا لم يقم المدين بتسليمه حتى هلك أو تلف كانت تبعة ذلك عليه. 2- إذا كان محل الا
- Article 307
Article 307 defines sale as a contract under which the seller transfers ownership of the item sold to the buyer for a cash price.
البيع عقد يُمَلِّكُ بمقتضاه البائع المبيع للمشتري مقابل ثمنٍ نقدي.
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.