ANSWER. CAPACITY IN UAE LAW

In general, the UAE courts will usually need to see explicit authority where the company has provided a certain representative (be it a manager, director or otherwise) to do that specific act for and on behalf of the company. General management powers granted to the directors or managers in the articles of association are unlikely to be sufficient for the purposes of establishing the capacity of a company to enter into finance transactions.

Another important aspect of the capacity check in the UAE is the ability to rely on the authorisations granted as per the Arabic text of the constitutional documents of the company. In a situation where the English text may give the particular authority that is being sought, but the Arabic translation does not, then such authority should not be relied upon as at the time of enforcement the Arabic text will prevail.It is not uncommon in the UAE for directors or managers to be granted general powers under the company’s memorandum and articles of association. Such powers are expressed in generic terms, referring to the power to ‘do all acts and deeds for and on behalf of the company’ or to ‘manage the company and do all things necessary to achieve its objects’. While useful for the management of the day-to-day operations of the company, relying on such generic powers when borrowing money, granting security or providing a guarantee can be risky.

Article 22 of the Federal Law No. 2 of 2015 on Commercial Companies (‘Companies Law’) states that a person who is authorised to manage a company must carry out all acts in accordance with the company’s objectives and powers granted to that person in accordance with an authorisation issued by the company. Article 23 of the same law states that all acts carried out by an authorised person in the context of the ordinary management of the company is binding on the company (to the extent such person is authorised to represent the company and third parties have relied on this fact in dealing with the company

UAE laws you must know to stay out of trouble

• No kissing, no touching.
• No swearing/making indecent gestures.
• No taking pictures of others without permission.
• Disrespecting any religion.
• No sharing private space with opposite sex.
• No indecent clothing

Article 129 of the Civil Code provides for three key components of a legal contract under UAE law including: agreement upon the essential elements of the contract (offer, acceptance, intention to create legal relations and consideration); certainty of the subject matter of the contract and the contract having a lawful ..

CAPACITY OF ENGLISH LAW

Under English law and other common law countries' legal systems. MoU's are regarded as unenforceable. This is because a MoU is often a short, concise document, signed by parties as a pre-cursor to enter into a more comprehensive document. Courts in common law countries regard MoU's as vague because they do not contain all the terms- only general ones.
Under the Article 141 of the Federal Law No.5 of 1985 issuing the civil transaction law for UAE (the "UAE Civil Code"), parties can agree the most essential terms in a MoU and then agree to finalise the details at a later date. The Dubai Court has the ability to enter the missing details and terms and therefore complete the contract.
In addition. UAE law can assume that if a party does not finalise the details of a contract, or is talking to third parties at the same time, then it may determine that a party is acting in 'bad faith' and is in breach of contract.

Typically contracts. under English/common law. allow one party to terminate a contract for "without cause". This basically allows one party to terminate if it no longer wishes to deal with the other for any reason.
UAE law specifically sets out the circumstances under which a contract may be terminated. These circumstances are limited. "Without cause" terminations are not allowed because they are contrary to Sharia law.