Qatar Court of Cassation Judgment- liability of managers in a Qatari limited liability company

Ahmed El Amoury - Senior Associate - Litigation / Employment & Incentives / Legislative Drafting / Insurance


The Claimant entered into a murabaha agreement with a limited liability company (LLC). A dispute arose from the said agreement and the Claimant commenced court proceedings against the LLC and its manager alleging that the LLC conducted illegal activities. The Claimant sought an order from the Court requesting that the LLC and the manager jointly and severally repay the Claimant’s monies.

The Court of First Instance and, on appeal, the Court of Appeal held in favour of the Claimant and ordered the LLC and the manager jointly to repay the Claimant’s monies.  The manager and the LLC filed a further appeal with the Court of Cassation arguing that a manager cannot be liable for the contractual obligations of a company.

The Court of Cassation decision:

The Court of Cassation disallowed the appeal and decided the following:

  • The provisions of the Articles 226 and 240 of Commercial Companies Law (Numbered 5 of 2002) stipulate that a manager of a limited liability company shall have full authority and power to manage and bind the company insofar as the company’s constitution does not limit his power.
  • A manager shall not be personally liable for any obligations resulting from the management of the company, with the exception of what is required for the protection of third parties dealing with a limited liability company.  The law provides that the name of the company should be accompanied by the words “company with limited liability” in all the company’s letters, correspondence and contracts. If the managers fail to abide by this requirement, they will be held personally and jointly liable for the liabilities of the company.
  • Both judgments of the Court of First Instance and the Court of Appeal found that the LLC had entered into a murabaha agreement and the manager had not added the phrase “with limited liability” to the company name, the Court of Cassation concluded that the appellants were jointly and personally liable for the obligations of the company based on the aforesaid provisions of the Commercial Companies Law.

Comment on the judgment

Notwithstanding that it may be a simple task to ascertain whether or not an entity is a company with limited liability, the failure of managers of such company to make it clear to all persons that the company they are dealing with is a limited liability can shift liability to such managers personally.

back Chat with us

Disclaimer: This chat service should not be relied upon as a substitute for professional advice which takes account of your specific circumstances and any changes in the law and practice. No warranty is made as to the accuracy or completeness of the information provided via this service and no liability is accepted by Al Tamimi & Company Limited, its affiliates, partners or employees for any loss arising as a result of reliance upon the information provided.

I Agree   

Kindly accept the disclaimer to proceed to a live chat.

Please choose one of the following options below:

Thank you for your inquiry. We will connect you to one of our agents now.

Thank you. Which service are you looking for?

Thank you for your interest in working with Al Tamimi & Company. Please click here to view our latest job openings.

Please click here leave a message and we will get back to you shortly.