Article 360 of the Saudi Civil Transactions Law
المادة 360 من نظام المعاملات المدنية · الفرع السادس: بيع ملك الغير
A buyer who did not know the item was not owned by the seller may claim compensation if the sale is annulled, even if the seller was in good faith.
Official text (Arabic)
This article has not been amended since the law was issued.
إذا كان المشتري يجهل أن المبيع غير مملوكٍ للبائع، وحكم بإبطال البيع، فللمشتري أن يُطالب بالتَّعويض ولو كان البائع حسن النية.
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 360 explained in plain English
This article complements the ruling on the sale of another's property in Article 359, which makes such a sale not take effect against the owner unless he approves it, and gives the buyer the right to request its annulment unless ownership of the item passes to the seller after the contract or the owner approves the sale.
This article adds the buyer's right to compensation, on two conditions:
- the buyer did not know that the item was not owned by the seller;
- and the sale was annulled by judgment.
If both conditions are met, the buyer may claim compensation even if the seller was in good faith, that is, even if the seller himself believed he owned the item. The Law here prioritizes protection of the buyer who did not know, and does not make the seller's good faith a reason to excuse him from compensation.
What is understood by implication? The article limits this right to a buyer who did not know that the seller was not the owner; a buyer who knew of that is not given this right by this article.
The article does not specify how the compensation is assessed or its elements, and the buyer is advised to keep what proves what he paid and the loss he suffered.
To assess a claim for compensation in a particular case, it is advisable to consult a lawyer specialized in civil or real estate cases.
Practical example
Yasser bought an apartment in Khobar from a person who believed in good faith that he had inherited it, and it then turned out to be owned by someone else, and the sale was annulled by judgment. Yasser did not know that the seller did not own the apartment, so he is entitled to claim compensation, and the seller's good faith does not excuse him from it.
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 360 of the Saudi Civil Transactions Law
Is the buyer entitled to compensation if a sale of another's property is annulled?
Yes, if he did not know that the item was not owned by the seller and the sale was annulled by judgment.
Is the seller excused from compensation if he did not know he was not the owner?
No. The article gives the buyer the right to compensation even if the seller was in good faith.
Is a buyer who knew the seller was not the owner entitled to compensation?
The article limits this right to a buyer who did not know that the item was not owned by the seller.
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.