EGYPT Law and Practice Contributed by: Mohamed Osama, Hana Elbarbary and Hamza Shehata, Shehata & Partners
the hearing minutes, which contain the settle- ment agreement itself. 8.3 Enforcement of Settlement Agreements There is nothing specific about settlement agreements when it comes to enforcing them. The judgment including the settlement agree- ment can be enforced as any regular judgment. 8.4 Setting Aside Settlement Agreements Settlement agreements are subject to the gen- eral provisions governing contracts in the Egyp- tian Civil Code. Therefore, the Egyptian courts may set aside a settlement agreement if they determine that any of its terms are illegal, violate the public order, or are tainted by fraud, lack of capacity, lack of consent, or lack of interest. 9. Damages and Judgment 9.1 Awards Available to the Successful Litigant The court grants to the party who wins the case, based on their request, compensation, whether on a contractual or a tortious basis, in addition to legal interest for the delay in executing the concerned obligation. This is in case the subject matter of the obligation is a sum of money. The court’s judgment for tort compensation is based on the existence of the fault, damage, and a causal relationship between both. The basis of contractual compensation is non-performance of the contractual obligation. It should be noted that if the compensation is determined by the contract, the judge will grant that compensa- tion, but this may be reduced if the losing party proves that it is exaggerated or proves that they have fulfilled part of their obligation.
In all cases, the judge cannot grant a higher compensation than the one agreed upon in the contract, unless the concerned party proves that the opponent has committed fraud or a grave error. Here, the provisions for compensation for tortious liability will also apply. As for delay interest rate; which is compensation for the delay in performing a duty if the subject matter of the obligation is a sum of money of a determined amount that has become due, the legal interest limit is then 4% annually in civil matters and 5% annually in commercial matters. In case the parties agreed otherwise, this inter- est rate cannot exceed 7% annually. It should also be noted that, as an exception to this gen- eral principle, it is permissible to agree on higher interest rates in banking operations and in some other instances, without being bound by the lim- its provided by the Civil Code. 9.2 Rules Regarding Damages The Egyptian legislature has enumerated sev- eral cases of punitive damages, including the following. • It is permissible to impose a threatening fine upon the claimant’s request if the defendant refuses to perform their obligation. The judge may also increase the threatening fine to force the defendant to perform their obliga- tion. • The court may also award compensation and a fine for expenses arising from a lawsuit or defence intended to be malicious. However, the fine in this case is awarded to the benefit of the court. Regarding the limits of compensation: • if compensation for contractual liability is determined by the contract, the judge can-
396 CHAMBERS.COM
Powered by FlippingBook