UAE Civil Transactions Law

Article 344

Book One: Obligations · Section Two: Effects of the Obligation · Chapter Two: Means of Performance · Part Four: Means of Securing the Performance of the Obligation · Fourth: Claim for Non-Enforceability of the Debtor's Disposition Against the Creditor

Any creditor whose right has become due, and whose debtor has made a disposition, may request the court to rule on the non-enforceability of this disposition against them, whenever this disposition diminishes the debtor's rights, increases their obligations, or results in their bankruptcy or insolvency, or aggravates their bankruptcy or insolvency, in the following cases: 1. If the debtor's disposition is for consideration, its non-enforceability as against the creditor is conditional upon the debtor being bankrupt or insolvent and upon the person in whose favor the disposition was made being aware of the debtor's bankruptcy or insolvency. 2. If the debtor's disposition is a gratuitous disposition which they were not obligated to make and which is not customary, it shall not be enforceable as against the creditor, even if the beneficiary acted in good faith and the debtor did not commit fraud. 3. If a successor to whom a thing was transferred by the debtor has disposed of it for consideration to another successor, the creditor may not rely on the non-enforceability of the disposition unless the second successor was aware of the debtor's fraud and the first successor was also aware thereof.

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