Article 480 of the Saudi Civil Transactions Law
المادة 480 من نظام المعاملات المدنية · الفرع الأول: إنشاء عقد الوكالة
The article defines agency as a contract by which the principal puts the agent in the principal's own place in a legal act.
Official text (Arabic)
This article has not been amended since the law was issued.
الوكالة عقد يقيم بمقتضاه الموكل الوكيل مقام نفسه في تصرُّفٍ نظاميٍّ.
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 480 explained in plain English
This article gives the definition of the agency contract, one of the most used contracts in daily life, such as authorizing someone to sell real estate, deal with an authority or conclude a contract.
The definition shows:
- The parties to the contract: the principal, who is the person concerned, and the agent, who takes the principal's place.
- The essence of agency: that the principal puts the agent in the principal's own place, so the agent acts on the principal's behalf.
- The subject of agency: a legal act, meaning a juristic act such as selling, buying, leasing or collecting rights.
Agency is a contract, that is, an agreement between the two parties, and not merely a one-sided permission. The definition does not mention a fee, and does not itself state the limits of the agent's authority or obligations.
This article follows Article 479, which refers the rules on the employment contract to the legal provisions specific to it. Article 481 then sets out the forms of agency, which may be unrestricted, restricted, conditional or deferred to a term. If you will appoint someone or accept an agency for someone, it is important to specify the act authorized clearly. When an agency needs to be drafted or a dispute arises over its limits, it is advisable to consult a lawyer specializing in civil matters.
Practical example
Mohammed works outside the Kingdom and wanted to sell land he owns in Riyadh, so he appointed his brother to take his place in completing the sale. Here Mohammed is the principal, and his brother is an agent taking his place in a legal act, which is selling the land.
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 480 of the Saudi Civil Transactions Law
What is an agency contract?
A contract by which the principal puts the agent in the principal's own place in a legal act.
What is the difference between the principal and the agent?
The principal is the one who puts another in the principal's own place, and the agent is the one who takes the principal's place in the legal act.
Can an agency be restricted?
Article 481 provides that an agency may be unrestricted, restricted, conditional or deferred to a term.
More articles on Agency Contract
- Article 87
The article permits contracting through representation unless statutory texts require otherwise, and divides representation into agreed, judicial and statutory.
1- يصح التعاقد بالنيابة؛ ما لم تقتض النصوص النظامية خلاف ذلك. 2- تكون النيابة في التعاقد اتفاقيةً أو قضائيةً أو نظاميةً.
- Article 88
The article prohibits a representative from exceeding the limits of his representation as set in the instrument creating it, whether a contract, a court judgment or a statutory text.
ليس للنائب أن يتجاوز حدود نيابته المعيَّنة في سند إنشائها، سواء أكان السند عقدًا أم حكمًا قضائيًّا أم نصًّا نظاميًّا.
- Article 90
If the representative contracts within the limits of his representation and in the principal's name, the rights and obligations arising from the contract are attributed to the principal.
إذا تعاقد النائب في حدود نيابته باسم الأصيل فإن ما ينشأ عن العقد من حقوقٍ والتزاماتٍ يُضاف إلى الأصيل.
- Article 152
The article provides that when the beneficiary approves what the volunteer agent did, the rules of agency apply to that work.
تسري أحكام الوكالة إذا أجاز المنتفع ما قام به الفضولي.
- Article 356
A representative may not buy for himself what he was entrusted to sell, even at auction or in another's name, without permission; the same applies to an intermediary, expert and the like.
مع مراعاة النصوص النظامية؛ ليس للنائب أن يشتري لنفسه باسمه أو اسم غيره ولو بطريق المزاد ما عهد إليه بيعه بمقتضى نيابته ما لم يكن مأذونًا له بذلك، كما لا يحق ذلك
- Article 357
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.
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 بعد
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.