Civil Law and UAE Law: Legal Capacity of Persons

1. Introduction

Legal capacity means the legal ability of a person to possess civil rights and, where the law permits, exercise those rights by entering into transactions, contracts and other legal acts.

In UAE civil law, legal capacity is important because a person may have the factual ability to sign a document but still lack the legal capacity required to make that transaction fully effective.

The current framework is the Federal Decree by Law No. 25 of 2025 promulgating the Civil Transactions Law, which entered into force on 1 June 2026 and repealed Federal Law No. 5 of 1985.

A major reform is that the new Civil Transactions Law sets the age of majority at 18 Gregorian years, rather than the former 21 lunar years. Article 84 provides that a person who has reached majority, has full mental capacity and is not subject to interdiction has full capacity to exercise civil rights.

2. Meaning of Legal Capacity

Legal capacity has two related dimensions:

A. Capacity to hold rights

This is sometimes called capacity of enjoyment.

It concerns a person's ability to be the holder of:

• property;
• contractual rights;
• inheritance rights;
• compensation claims;
• personal rights; and
• other civil rights.

B. Capacity to exercise rights

This concerns the person's ability to personally perform legal acts, such as:

• entering a contract;
• selling property;
• purchasing property;
• borrowing money;
• making certain dispositions;
• giving authority to an agent; or
• bringing or defending legal proceedings.

A person may therefore possess rights while being legally restricted from exercising some of them independently.

3. Current UAE Legal Framework

The most important provisions are found in Articles 84–88 of the 2025 Civil Transactions Law.

The basic structure is:

Full capacity → Limited capacity → Lack of capacity → Legal representation/protection

The new law also contains an important conflict-of-laws rule.

Under Article 11, civil status and legal capacity of a natural person are generally governed by the law of the person's nationality. However, in certain financial transactions concluded in the UAE producing their effects there, an undisclosed foreign incapacity will not affect the person's capacity where the other party could not reasonably have known of it.

4. Full Legal Capacity

Article 84 provides, in substance, that a person has full legal capacity when the person:

1. has reached the age of majority;
2. has full mental capacity; and
3. has not been placed under a legal restriction/interdiction.

The new age of majority is 18 Gregorian years.

Therefore:

18 years + full mental capacity + no legal restriction = full civil capacity

A fully capable adult can ordinarily:

• enter contracts;
• acquire property;
• dispose of property;
• incur contractual obligations;
• sue and be sued;
• appoint agents; and
• exercise other civil rights.

5. Reduction of Majority from 21 to 18

This is one of the most important changes introduced by the 2025 Civil Transactions Law.

Former position

Under the repealed 1985 law, full age was 21 lunar years. Historical Article 85 provided that a person reaching 21 lunar years, possessing full mental capacity and not being interdicted was fully capable.

Current position

The new law uses 18 Gregorian years.

This means that a person who has completed 18 Gregorian years may generally acquire full civil capacity, subject to mental capacity and any applicable legal restriction.

Practical effect

This affects:

• contracts;
• banking transactions;
• property transactions;
• commercial activities;
• guarantees;
• litigation;
• powers of attorney; and
• other civil dealings.

6. Persons of Limited Capacity

The new law distinguishes between complete incapacity and limited capacity.

Article 86 identifies persons of limited capacity, including:

1. a person who has reached the age of discernment but not the age of majority; and
2. a person who has reached majority but is legally classified as prodigal or suffering from legal imprudence. 

This is important because not every person below 18 is treated in exactly the same way.

The law therefore recognises different degrees of legal protection.

7. Children and Age of Discernment

The new Civil Transactions Law distinguishes the stage before and after legal discernment.

The statutory structure recognises children who have not attained the relevant age of discernment as lacking the capacity to exercise civil rights independently, while a discerning minor falls into the limited-capacity category.

This approach attempts to balance:

Protection of children + recognition of developing autonomy.

The distinction becomes particularly important in determining whether a transaction is:

• valid;
• void;
• voidable;
• subject to ratification; or
• dependent upon representation.

8. Persons with Mental Incapacity

Legal capacity is not determined solely by age.

A person who has reached 18 may nevertheless have restricted capacity where the statutory conditions concerning mental capacity or interdiction apply.

The important distinction is:

Age of majority does not automatically answer every capacity question.

A court may need to determine whether the person possessed the legally relevant mental capacity at the time of the particular transaction.

This is especially important in:

• property transactions;
• guarantees;
• wills;
• gifts;
• settlements;
• large financial transactions; and
• contractual disputes.

9. Capacity is Transaction-Specific

Legal capacity should not be understood as a purely abstract question.

The nature of the legal act can matter.

A simple transaction may require less understanding than a highly complex disposition involving:

• multiple properties;
• complicated financial arrangements;
• corporate interests; or
• testamentary dispositions.

This principle is particularly visible in the recent DIFC case concerning testamentary capacity discussed below.

10. Legal Representation and Protection

Article 87 provides that persons lacking capacity or having limited capacity, together with missing and absent persons where applicable, are subject to the statutory regimes concerning:

• guardianship;
• tutorship;
• curatorship; and
• representation of absent persons. 

The objective is not simply to prevent transactions.

It is also to provide a mechanism through which protected persons can have their legitimate interests managed.

11. Capacity Cannot Simply Be Waived

Article 88 provides that a person cannot:

• waive personal freedom;
• waive legal capacity;
• alter the statutory rules governing capacity; or
• make capacity itself the subject of a transaction. 

This reflects the public-law character of legal capacity.

For example, parties cannot simply insert a contractual clause saying:

“The parties agree that neither party may ever rely upon incapacity.”

Such a clause cannot override mandatory statutory rules concerning legal capacity.

12. Legal Capacity and Capacity to Contract

Legal capacity is one of the fundamental considerations in contractual validity.

The basic sequence is:

Capacity → Consent → Subject Matter → Lawful Purpose → Form where required → Valid Contract

A person's signature alone does not necessarily settle the question.

The court may have to ask:

1. Was the person legally capable?
2. Did the person understand the transaction?
3. Was the person authorised?
4. Was consent freely given?
5. Was the transaction legally permissible?

13. Case Law 1 — Nitin Kedarnath Gupta v Rohit Kedarnath Gupta

Case: Nitin Kedarnath Gupta v Rohit Kedarnath Gupta, [2024] DIFC CFI 059, judgment dated 19 August 2026.

This is a particularly important recent UAE/DIFC authority concerning testamentary capacity.

The claimant challenged a 2021 DIFC Will on the basis that the testator lacked:

• testamentary capacity;
• knowledge and approval; and
• freedom from undue influence. 

The Court considered extensive medical and factual evidence concerning the testator's cognitive condition.

A particularly important principle discussed by the Court was that the mental capacity required for an instrument is relative to the particular transaction. The complexity of the transaction can therefore affect the level of understanding required.

The Court ultimately found that the testator did not lack testamentary capacity at the time of execution.

Legal significance

The case demonstrates:

Capacity is assessed at the relevant time and in relation to the particular legal act.

It also demonstrates the importance of:

• medical evidence;
• factual evidence;
• witness evidence;
• complexity of the transaction; and
• the distinction between capacity and knowledge/approval.

14. Case Law 2 — Ahmed Seddiq Mohamed Samea Almutawa v Mohamed Seddiq Mohamed Samea Al Mutawa

Case: Ahmed Seddiq Mohamed Samea Almutawa v Mohamed Seddiq Mohamed Samea Al Mutawa, CFI 095/2023, DIFC Courts.

The defendant argued that he had:

• not fully and voluntarily assented to a share purchase agreement;
• been subject to coercion or undue influence; and
• lacked the cognitive capacity to understand the contract. 

The Court treated lack of capacity as a distinct legal issue requiring evidence.

Legal significance

The case illustrates that an allegation of incapacity does not itself establish incapacity.

A party raising the issue must provide evidence capable of establishing the alleged condition and its relationship to the transaction.

It also shows the importance of expert evidence in cases involving alleged cognitive incapacity.

15. Case Law 3 — NS Investment Limited v Ajay Sethi

Case: NS Investment Limited v Ajay Sethi, [2020] DIFC CFI 055.

The DIFC Court expressly stated that the starting point when determining whether a transaction is valid and binding is the legal capacity of the parties to enter into that particular transaction.

The Court examined the claimant company's:

• constitutional documents;
• licensed activities;
• JAFZA regulations; and
• applicable regulatory requirements.

The case concerned whether the company had legal capacity to enter into the particular loan transaction.

Legal significance

Although this is a corporate-capacity case rather than a natural-person capacity case, it demonstrates an important general principle:

Capacity is connected to the legal scope within which a person or entity is permitted to act.

For individuals, the source may be age, mental capacity or interdiction.

For companies, it may include:

• constitutional documents;
• licence;
• statutory restrictions; and
• regulatory rules.

16. Case Law 4 — Ginette PJSC v Geary Middle East FZE & Geary Limited

Case: Ginette PJSC v Geary Middle East FZE & Geary Limited, [2016] DIFC CA 005.

The case concerned the authority of a company officer to enter into an arbitration agreement.

The argument was that the person who signed the agreement lacked the necessary authority to bind the company to arbitration. The DIFC Court considered the distinction between a person's position within the company and the specific authority necessary to enter into the arbitration agreement.

Legal significance

This demonstrates an important distinction:

Legal capacity ≠ authority.

A person may have general capacity but lack authority for a particular transaction.

For example:

Director ≠ automatically authorised to perform every legally significant act on behalf of the company.

17. Case Law 5 — YYY Limited v ZZZ Limited

Case: YYY Limited v ZZZ Limited, [2017] DIFC ARB 005.

The dispute involved the authority to conclude an arbitration agreement.

The DIFC proceedings discussed Dubai Court of Cassation authority concerning the requirement that an arbitration agreement be entered into by a person having the necessary legal capacity to dispose of the right forming the subject matter of the dispute. The Court also considered the limits of authority granted to company officers.

Legal significance

The case demonstrates that capacity can become particularly important where the transaction involves the waiver or modification of important procedural rights, such as agreement to arbitrate.

18. Case Law 6 — Michael George Forbes v Robert Kidd

Case: Michael George Forbes v Robert Kidd, [2023] DIFC CFI 081.

The case involved the formation of a contract under UAE law and the question of whether the parties had sufficiently manifested agreement.

The Court discussed the former UAE Civil Transactions Law provisions concerning:

• mutual consent;
• offer and acceptance;
• expression of intention; and
• acceptance by conduct. 

Legal significance

The case helps distinguish:

Capacity from consent.

A person may possess full legal capacity but there may nevertheless be no contract if the required mutual consent is absent.

Therefore:

Capacity is necessary for many transactions, but capacity alone does not establish contractual validity.

19. Case Law 7 — Lucian v Lathore

Case: Lucian v Lathore, [2022] DIFC SCT 064.

The Court considered the capacity of an individual who signed a hire contract and, importantly, whether the person had authority to accept the relevant terms on behalf of the defendant.

The Court found that the evidence did not establish the necessary authority or a clear agreement to opt into DIFC jurisdiction.

Legal significance

This case demonstrates the importance of distinguishing:

• capacity of the individual;
• authority to act for another;
• contractual acceptance; and
• jurisdictional consent.

20. Case Law 8 — Khaled Salem Musabeh Humaid Al Mheiri v Mohammad Ezelddine El Araj & John Cameron

Case: Khaled Salem Musabeh Humaid Al Mheiri v Mohammad Ezelddine El Araj & John Cameron, [2021] DIFC CFI 057.

This case is another example of the DIFC Courts dealing with questions involving contractual and commercial authority within the UAE legal environment.

Its relevance to capacity lies in the broader distinction between a party's legal status and the authority under which another person purports to act for that party.

21. Case-Law Principle: Capacity vs Authority

A major examination issue is the distinction between capacity and authority.

Capacity

Answers:

“Can this person legally perform this kind of act?”

Authority

Answers:

“Is this person authorised to perform the act for this particular principal?”

Example

A company director may have legal capacity to sign an agreement personally, but whether the signature binds the company depends upon:

• articles;
• board resolutions;
• powers of attorney;
• applicable legislation; and
• scope of authority.

The Ginette and YYY Limited cases demonstrate this distinction.

22. Capacity and Foreign Nationals

Article 11 is particularly important in the UAE because of the country's international population.

The general rule is:

Civil status and legal capacity of a natural person are governed by the law of the person's nationality.

There is, however, an important protection for commercial transactions in the UAE.

Where:

• a foreigner has limited capacity;
• the transaction is financial;
• the transaction is concluded in the UAE;
• it produces its effects in the UAE; and
• the reason for the limited capacity was not readily apparent to the other party,

that hidden incapacity does not affect the foreigner's capacity as against the other party.

23. Example of Article 11

Suppose:

• A is a foreign national;
• under the law of A's nationality, A has a particular restriction on capacity;
• A enters a commercial financial transaction in the UAE;
• the restriction is not apparent to the UAE counterparty.

The counterparty may receive statutory protection against having the transaction invalidated merely because of an undiscoverable foreign incapacity.

This rule promotes:

• commercial certainty;
• good-faith dealing;
• protection of counterparties; and
• stability of UAE transactions.

24. Capacity and Wills

Testamentary capacity has special importance.

The recent Nitin Gupta v Rohit Gupta case illustrates that the court may examine:

• cognitive condition;
• complexity of the Will;
• medical evidence;
• circumstances of execution;
• understanding;
• knowledge and approval;
• undue influence.

The Court emphasised that the level of cognitive capacity required can depend on the complexity of the instrument.

Thus:

Contractual capacity ≠ necessarily identical to testamentary capacity.

The relevant legal test depends on the nature of the legal act and applicable legislation.

25. Capacity and Mental Condition

A court should distinguish between:

A. Medical condition

A person may have a medical or cognitive condition.

B. Legal incapacity

The legal question is whether that condition satisfies the applicable legal standard for incapacity in relation to the relevant transaction.

Therefore:

Medical diagnosis and legal incapacity are not automatically identical.

This is particularly clear from the extensive expert evidence considered in Nitin Gupta v Rohit Gupta.

26. Evidence in Capacity Disputes

Capacity disputes frequently require evidence concerning:

• age;
• medical records;
• cognitive assessments;
• witness testimony;
• contractual documents;
• communications;
• behaviour before and after the transaction;
• professional advice;
• circumstances of execution;
• powers of attorney; and
• surrounding circumstances.

Expert evidence may be particularly important where mental capacity is disputed.

In Ahmed Almutawa, lack of cognitive capacity was expressly pleaded as an issue, and the Court's case-management framework addressed expert evidence.

27. Capacity and Ratification

Where a person has limited capacity, the legal consequences of a transaction can depend upon:

• the type of transaction;
• statutory classification;
• approval by the appropriate representative;
• court approval where required;
• subsequent ratification; and
• whether the transaction benefits or prejudices the protected person.

Therefore, lawyers should not simply classify every transaction by saying:

“Minor = all contracts invalid.”

The statutory regime is more nuanced.

28. Capacity and Guardianship

Where a person lacks full capacity, legal representation may become necessary.

The relevant protective structures can include:

• guardian;
• tutor;
• curator;
• representative; and
• representation for an absentee or missing person.

Article 87 expressly connects persons lacking or having limited capacity with these protective regimes.

29. Capacity and Property Transactions

Capacity becomes particularly important in:

• property sales;
• mortgages;
• gifts;
• settlement agreements;
• guarantees;
• investment agreements;
• succession arrangements.

Before accepting a transaction, practitioners should verify:

1. identity;
2. age;
3. legal status;
4. capacity;
5. authority;
6. power of attorney;
7. court approvals where applicable; and
8. applicable special legislation.

30. Capacity and Power of Attorney

A Power of Attorney does not automatically cure every capacity problem.

The lawyer must distinguish:

Principal's capacity → validity of POA → agent's authority → transaction within authority

For example:

A person cannot necessarily grant unlimited authority through a POA if the person lacked the legal capacity required to grant that authority in the first place.

Similarly, an agent may possess a valid POA but act outside its scope.

31. Capacity and Arbitration

Capacity becomes especially important in arbitration because arbitration can involve significant waiver of ordinary court procedures.

The UAE/DIFC authorities demonstrate that lawyers should examine:

• who signed;
• what authority existed;
• whether special authority was required;
• whether the person could dispose of the underlying right; and
• whether the arbitration agreement was validly concluded.

The Dubai Court of Cassation authority discussed in YYY Limited v ZZZ Limited and Ginette illustrates this principle.

32. Legal Capacity of Natural Persons vs Legal Persons

A useful distinction is:

Thus, “capacity” has different legal mechanisms depending on the type of legal person.

33. Current vs Historical Law

This distinction is essential for UAE legal research.

Historical position

Under the repealed 1985 Civil Transactions Law:

• majority was 21 lunar years;
• Article 85 dealt with full capacity;
• Article 86 dealt with lack of discernment;
• Article 87 dealt with defective capacity.

Current position

From 1 June 2026:

• Federal Decree by Law No. 25 of 2025 applies;
• the age of majority is 18 Gregorian years;
• the new Articles 84–88 govern legal capacity. 

Historical UAE Court of Cassation cases decided under the 1985 Code should therefore be used carefully and should not automatically be presented as interpretations of the new article numbering.

34. Practical Legal Test for Capacity

A UAE lawyer dealing with a capacity dispute can use this sequence:

Step 1 — Identify the person

Natural person or legal person?

Step 2 — Identify the applicable law

UAE federal law, Emirate law, DIFC, ADGM or foreign law?

Step 3 — Determine age/status

Has the person reached 18 Gregorian years?

Step 4 — Examine mental capacity

Was the person legally capable at the relevant time?

Step 5 — Check interdiction/restriction

Was there a court-ordered or statutory restriction?

Step 6 — Identify the transaction

Contract, Will, property transaction, arbitration agreement, guarantee, etc.

Step 7 — Examine authority

Was the person acting personally or for another?

Step 8 — Examine representation

Was a guardian, tutor, curator or attorney involved?

Step 9 — Determine consequence

Void, voidable, enforceable, subject to approval, ratification or other statutory consequence?

Step 10 — Examine evidence

What documentary, medical, expert and witness evidence establishes capacity?

35. Important Case-Law Revision Table

36. Key Principles for Examination

Principle 1

Legal capacity is the ability recognised by law to exercise civil rights.

Principle 2

The current age of majority is 18 Gregorian years.

Principle 3

Age alone does not determine full capacity; mental capacity and absence of legal restriction also matter.

Principle 4

A discerning minor has limited rather than necessarily zero capacity.

Principle 5

Persons lacking or having limited capacity may require legal representation or protective measures.

Principle 6

Capacity and authority are different concepts.

Principle 7

Medical condition does not automatically equal legal incapacity.

Principle 8

Capacity may need to be assessed in relation to the particular legal act and the time at which it was performed.

Principle 9

Article 11 is important for foreign nationals because nationality generally determines civil status and capacity, subject to the UAE transactional protection for undisclosed foreign incapacity.

Principle 10

Historical 1985 Civil Transactions Law authorities must be distinguished from the current 2025 Civil Transactions Law.

37. Conclusion

The legal capacity of persons under UAE civil law is designed to balance two competing objectives:

Individual autonomy
and
protection of persons who cannot legally or practically protect their own interests.

The current framework under Federal Decree by Law No. 25 of 2025 represents an important reform. The reduction of the age of majority to 18 Gregorian years, together with rules concerning limited capacity, interdiction, representation and foreign capacity, modernises the UAE civil-law framework.

The case law also demonstrates that capacity is not merely an age-based question. Courts may have to consider:

Age + mental capacity + transaction + authority + representation + evidence + applicable law.

The recent Nitin Gupta decision is especially useful because it demonstrates that capacity can be time-specific and transaction-specific, while NS Investment, Ginette and YYY Limited illustrate the separate but related question of authority to act for another person.

Quick Revision Formula

UAE Legal Capacity = Age + Mental Capacity + Legal Status + Absence of Interdiction + Transaction-Specific Assessment + Proper Representation

Current law: Federal Decree by Law No. 25 of 2025, effective 1 June 2026.
Majority: 18 Gregorian years.
Key provisions: Articles 84–88, with Article 11 important for cross-border capacity.