Article 486 of the Saudi Civil Transactions Law
المادة 486 من نظام المعاملات المدنية · الفرع الثاني: التزامات الوكيل
The article sets the scope of an agent's authority to act, treats money the agent receives for the principal as a deposit, and explains when acting more beneficially is not an overstep.
Official text (Arabic)
This article has not been amended since the law was issued.
1- يثبت للوكيل بمقتضى عقد الوكالة حق التصرف فيما يتناوله التوكيل وما يقتضيه من توابع ضرورية وفقًا لطبيعة التصرف ولما انصرفت إليه إرادة المتعاقدين وما جرى عليه العرف.
2- يعد المال الذي تسلَّمَه الوكيل لحساب موكله وديعة.
3- لا يعد تصرف الوكيل بما هو أنفع للموكل تجاوزًا لحدود الوكالة؛ ما لم يكن للموكل غرضٌ في تحديد الوكالة.
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 486 explained in plain English
This article answers a practical question: what powers does an agent have? It sets out three rules:
- Scope of authority: The agent may act within what the authorization covers and within the necessary incidentals it requires. This is determined by the nature of the act, what the contracting parties intended, and custom. An agency is not read only literally; it also covers what the act cannot be carried out without.
- Money received: Any money the agent receives on behalf of the principal is treated as a deposit, so the agent holds it for the principal and does not own it.
- More beneficial action: If the agent acts in a way that is more beneficial to the principal than what was specified, this is not an overstep of the agency, unless the principal had a purpose in setting that limit.
A restriction set by the principal is respected whenever the principal had a purpose in it, and the agent may not exceed it on the ground that doing so is more beneficial. If the principal had no purpose in the limit, the more beneficial act is acceptable.
This article is followed by Article 487, which sets the level of care required of the agent in carrying out the agency depending on whether it is paid or unpaid, and preceded by Article 485, which treats later ratification of an act as equivalent to prior agency. If there is a dispute about the limits of a particular agency, it is advisable to consult a lawyer specializing in civil matters.
Practical example
Majed appointed his friend to sell his car for SAR 50,000, and the friend sold it for SAR 55,000. This act is more beneficial to Majed, so it is not an overstep of the agency unless Majed had a purpose in fixing that amount. The price the friend received is treated as a deposit held for Majed.
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 486 of the Saudi Civil Transactions Law
Can an agent do something that is not expressly mentioned in the agency?
The agent may act within what the authorization covers and the necessary incidentals it requires, according to the nature of the act, the intention of the parties, and custom.
What is the status of money an agent receives for the principal?
It is treated as a deposit, under the second paragraph of the article.
Is it an overstep if the agent sells for a higher price than specified?
An agent's act that is more beneficial to the principal is not an overstep, unless the principal had a purpose in setting the limit.
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.