By Nizar Kochery /Doha
QUESTION: We are a contracting company, facing problems in completing a job because of financial constraints. It has been agreed to modify the contract in two different models. In one, our scope of work is reduced and in the other, a third party is added to complete the job. A novation of contract is being prepared. What is novation under Qatar’s laws?
FT, Doha
ANSWER: Novation extinguishes the old contract. It is the agreement of parties to a contract to substitute a new contract for the old one and is often used when the parties find that payments or performance cannot be made under the terms of the original agreement, or the debtor will be forced to default or go into bankruptcy unless the debt is restructured. The relevant provisions are Articles 381 to 386 of the Civil Law.
According to Article 381, novation is defined as a change of the debt when the two parties agree to substitute a new obligation for the original obligation. Novation is not presumed; it must be expressly agreed or result clearly from the circumstances.
The new obligation differs from the original obligation in respect of its object or as regards its source by a change of the debtor, when a creditor and a third party agree that such third party shall take the place of the original debtor and that the original debtor shall be released of the debt without his consent being necessary, or when the debtor has procured the consent of the creditor to substitute the debtor by a third party who consents to be the new debtor; also by a change of the creditor, when the creditor, the debtor and a third party agree that his third party shall be the new creditor.
Bounced cheque
Q: Last year, I lodged a complaint with Capital Police on a bounced cheque. The department issued a number to me and I have been waiting for some results for months now. I understand that though police arrested the person who had issued the bounced cheque, he was released on bail later on someone’s guarantee. He had also kept his passport with police as a surety. I haven’t received any notice or message from the prosecution. This has been dragging on since September last year. What are my options now?
KJ, Doha
A: Public Prosecution is not required legally to inform the complainant neither about the status of the case nor the date of referring the case to the competent court as do so. Follow up with the public prosecution as well as the competent court in Al Sadd in order to understand the status of the case. If the accused has been referred to the criminal court, apply for such court and demand right of the full amount of the cheque or to file a case before the civil court if the case before the criminal court is over.
Choice between gratuity and profits
Q: I worked for more than five years as a sales manager. The employment contract included monthly salary as well as 5% of the net profits. So far no share of profit has been paid to me. I have submitted my resignation and upon calculating my dues, my company informs me that as per Qatar’s Labour Laws, I don’t have the right to combine end-of-service gratuity and profits; the profits are only for company partners and according to them, the only choice for me is to accept the end-of service gratuity or profits, whichever higher. The company is refusing to issue me an employment certificate and return my original certificates submitted to the employer. Please advise.
IN, Doha
A: The employee is entitled to end-of-service gratuity in full in addition to 5% of the profits. Seek the Labour Department’s assistance and in the event of failure to reach solution before the department, approach the competent court. Regarding service certificate, the employer must grant service certificate indicating details of employment and also the employer should return the certificates, documents etc. which the worker deposited with the employer at the time of engagement under Article 53.
Penalty Provisions
Q: Can a company operating under Qatar’s Labour Laws punish an employee for fighting with a colleague over an issue that is not related to work? I have worked with a company for more than two years; last month I had a fight with a person while I was at the company camp. After knowing about this, the company started investigating. I was informed by my company manager that I might be subjected to disciplinary action and my visa might be cancelled. Is the company entitled, in accordance with the labour laws, to impose penalty on me and terminate me for an issue occurred outside the workplace and is not related to it? There is no police case in the matter.
LO, Doha
A: No disciplinary penalty may be imposed on a worker for any act committed by him outside the workplace, unless such act is connected with the work, the employer or the responsible manager. Article 62 stipulates that the worker shall not be penalised otherwise than for a violation directly related to the work whether committed during the work and in its place or outside. It shall also be unlawful to impose more than one penalty or to combine a disciplinary penalty with a deduction of part of the worker’s remuneration.
LEGAL SYSTEM IN QATAR
If there is a cause that interrupts the effective period of prescription towards some of the creditors’ heirs, the prescription shall not be interrupted towards the remaining heirs.
Prescription is interrupted by legal proceedings even if instituted in a court without jurisdiction, by a summons or by an attachment, by the application of a creditor for the admission of his claim in a bankruptcy or in a distribution, or by any act of a creditor to claim his right in the course of legal proceedings.
Prescription is interrupted by an express or tacit admission of the right of the creditor by the debtor.
A debtor who leaves a pledge in the hands of his creditor as security for his debt is deemed to have tacitly acknowledged the debt even though the creditor retained it on the basis of his right to refuse returning it pending the settlement of the debt related.
According to Article 415, when prescription is interrupted, a new prescription commences to run from the time that the effect of the act that gave rise to the interruption has ceased. The term of the new prescription will be of the same duration as that of the former one. However, the tem of the new prescription shall be fifteen years in the following events:
When the debt has been awarded by a final court judgement except where the judgement rules for granting renewable periodical obligations that shall be due after it has been handed down.
When the right in question shall not be admitted after the lapse of five years in accordance with Article 405 or upon the lapse of one year according to Article 407 and the prescription period was interrupted due to the debtor’s admission.
When a right is extinguished by prescription, the other accessories to the debt are also extinguished even if the term of the particular prescription applying to these accessories has not expired.
The court of its own initiative cannot invoke prescription. Prescription must be invoked by the debtor, or by his creditors, or by any interested party, even if the debtor has failed to do so. Prescription may be invoked at any stage of the proceedings, even before the Court of Appeal.
Under Article 418, a debtor cannot renounce the benefit of prescription before he has acquired the right to invoke it, nor can he agree to a term of prescription other than that fixed by law.
A person, however, who is legally capable of disposing of his rights, may renounce, even tacitly, a right to prescription which he is in a position to invoke, but a renunciation made to the detriment of his creditors will have no effect against them.