LEBANON Law and Practice Contributed by: Nayla Comair-Obeid, Ziad Obeid and Zeina Obeid, Obeid & Partners
be considered if they are directly linked to the non-performance of the obligation (Article 261 of the COC). The competent judge may exceptionally award compensation for future damages (eg, loss of profits) if their realisation is certain and can be precisely assessed (Article 264 of the COC). In the context of contracts, compensation cov- ers only those damages that were foreseeable at the time the contract was concluded, provided the debtor has not committed fraud (Article 262 of the COC). 9.3 Pre-judgment and Post-judgment Interest Interest will be computed upon the maturity date of the debt/obligation which, according to the circumstances of the case, may fall before or after the judgment is rendered. The statute of limitations for interest is five years, which runs from the day the obligation/right becomes due (Articles 348 and 350 of the COC). 9.4 Enforcement Mechanisms of a Domestic Judgment The enforcement of a domestic judgment involves filing an application to this end before the execution judge (the “Enforcement Bureau”). Pursuant to Article 828 of the LCCP, the Execu- tion Judge is the judicial authority competent to enforce a domestic judgment. The request for enforcement should be sub- mitted at the clerk’s office of the Enforcement Bureau and include all relevant details (ie, the name of the person requesting enforcement, the name of the opponent party, their place of residence, titles, capacity, and elected domicile, along with the judgment for which execution is
sought, the requested amount, and the assets to be seized where relevant, etc (Article 837 of the LCCP). The enforcement process is subject to certain conditions. For instance, a domestic judgment cannot be enforceable unless it has the force of res judicata (Article 836 of the LCCP) or is an interim measure or an ex parte decision (which is enforceable de jure). For enforcement purposes, certain measures such as seizures and third-party debt orders may be ordered. Additionally, Article 569 of the LCCP provides for the courts’ power to order a penalty to ensure the enforcement of the judgments in case of par- tial, non-execution, or delay in the execution of the judgment. Insolvency proceedings may be initiated against the defaulting party in the event where the defaulting party is a trader in a cessation of pay- ments situation. For completeness, cessation of payment occurs when it is established that the debtor is in a desperate financial situation, and has failed to pay any outstanding debt that is: (i) commercial in nature (ii) due and (iii) certain (ie, typically, a final court judgment would fulfil this condition). 9.5 Enforcement of a Judgment From a Foreign Country Unless otherwise provided by virtue of an inter- national convention signed between Lebanon and a foreign state, foreign judgments are recog- nised in Lebanon via an exequatur order, which is a pre-requisite to enforcement. To obtain an exequatur order, an application must be filed ex parte to the President of the Court of Appeal – Civil Section, having jurisdiction over:
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