Breach of Contract: Remedies under Egyptian Civil Law

Under the Egyptian Civil Code, a contract is considered the "law of the parties." When a party fails to fulfill its obligations, the non-breaching party is entitled to several specific legal pathways to restore the balance of the agreement.

Specific Performance vs. Rescission

The primary remedy in Egypt is specific performance (Al-Tanfiz Al-Ayni), where the court compels the breaching party to fulfill their specific obligation. However, if performance is impossible or too burdensome, the court may order rescission (Faskh) of the contract, effectively returning the parties to their pre-contractual state.

Calculation of Damages

Egyptian courts apply a strict standard for awarding damages. The claimant must prove three elements: the breach (error), the loss (damage), and a direct causal link between the two. Unlike some common law jurisdictions, punitive damages are not recognized; awards are strictly compensatory, covering actual loss and lost profits (Lucrum Cessans).

Common Misconceptions

Many believe that a breach automatically triggers a right to terminate. In reality, unless the contract contains an "explicit termination clause" (Al-Shart Al-Fasikh Al-Sarih), a party must usually serve a formal legal notice (Inzaar) and obtain a court judgment to finalize the rescission.