Civil Law and UAE: Behavioral Control Functions of Modern Private Law

1. Introduction

Behavioral control is one of the important functions of modern private law. It means that private law does not merely resolve disputes after they occur; it also guides and controls the behavior of individuals, companies, employers, consumers, landlords, tenants, shareholders and other private actors.

In the UAE, this function is particularly important because modern private law regulates a rapidly developing economy involving real estate, finance, technology, digital transactions, construction, companies and cross-border commerce.

The UAE's new Federal Decree-Law No. 25 of 2025 Promulgating the Civil Transactions Law repealed the 1985 Civil Transactions Law and entered into force on 1 June 2026. The new legislation expressly seeks to modernise the framework of rights and obligations, strengthen legal certainty, protect free will, and balance individual autonomy with protection against exploitation and harm.

2. Meaning of Behavioral Control in Private Law

Behavioral control means using legal rules to influence how private parties behave.

For example:

• A contract law rule encourages parties to perform promises.
• Good-faith rules encourage honest contractual conduct.
• Tort rules discourage negligent or harmful conduct.
• Compensation rules encourage people to avoid causing damage.
• Property rules discourage interference with another person's property.
• Abuse-of-rights rules prevent a person from using a legal right merely to harm another.
• Public-order rules prevent private agreements from undermining mandatory social or legal interests.
• Restitution rules discourage unjust enrichment.
• Procedural rules discourage fraudulent or abusive litigation.

Therefore:

Private law controls behavior by attaching legal consequences to particular forms of conduct.

3. Why Modern Private Law Needs Behavioral Control

Traditional private law was often viewed mainly as a system for resolving disputes.

Modern private law performs a broader function:

Rule → Expected behaviour → Legal consequence → Behavioral incentive

For example:

Good-faith rule → honest performance → liability/remedy for bad faith → parties behave honestly.

This makes private law both:

1. Reactive – it provides remedies after a violation; and
2. Preventive – it encourages people to avoid violations in the first place.

4. Main Behavioral Control Functions in UAE Private Law

A. Control Through Contract

Contracts are one of the strongest behavioral-control mechanisms.

When parties enter into a contract, private law creates expectations concerning:

• performance;
• payment;
• delivery;
• cooperation;
• disclosure;
• confidentiality;
• quality;
• termination;
• damages.

The law therefore encourages parties to treat contractual commitments seriously.

The new UAE Civil Transactions Law strengthens this approach by providing modern rules concerning contractual formation, interpretation, good faith, pre-contractual negotiations and framework agreements. The UAE Government specifically describes the new law as strengthening trust and informed contractual decision-making.

Example

A construction company promises to complete a building by a specified date.

The possibility of:

• damages,
• performance,
• termination,
• adjustment of contractual relations,

encourages the contractor to perform properly.

5. Good Faith as a Behavioral Control

Good faith is perhaps one of the most important behavioral-control principles.

It requires parties to behave consistently with:

• honesty;
• cooperation;
• legitimate expectations;
• contractual purpose;
• fair dealing.

Under the former UAE Civil Transactions Law, Article 246 required contractual performance in accordance with good faith and extended contractual obligations beyond express wording to matters arising from law, custom and the nature of the transaction.

The new law continues and reinforces this approach; secondary legal analysis of the new law identifies Article 221 as expressly reinforcing good-faith performance.

Behavioral effect

Without good faith:

“I have a technical contractual right, therefore I can do anything.”

With good faith:

“I have a contractual right, but I must exercise it within the legal and contractual framework.”

6. Control Through Abuse of Rights

A person may possess a legal right but still exercise that right unlawfully.

The traditional UAE Civil Transactions Law Article 106 recognised circumstances in which exercise of a right could become unlawful, including intentional harm, disproportion between benefit and harm, and exceeding customary or legally recognised limits.

This doctrine performs an important behavioral function:

It prevents private rights from becoming instruments of oppression.

For example, a property owner normally has rights over property. But the existence of ownership does not necessarily mean every conceivable use of that property is legally protected.

Similarly, a creditor may have a contractual right, but the manner in which that right is exercised can still be subject to legal limitations.

The doctrine therefore balances:

Individual autonomy + protection of others.

7. Control Through Tort Liability

Tort law encourages people to avoid causing unlawful harm.

The basic behavioral structure is:

Wrongful conduct → Damage → Causation → Civil liability → Compensation

The UAE courts have recognised the importance of fault, damage and causation in civil responsibility. UAE Federal Supreme Court jurisprudence has also distinguished direct action from causative conduct and considered the circumstances in which liability arises.

Behavioral effect

If a person knows that negligent conduct may result in compensation, that person has an economic and legal incentive to behave carefully.

For example:

• a driver is encouraged to drive safely;
• a construction company is encouraged to maintain safety standards;
• a professional is encouraged to exercise appropriate care;
• a business is encouraged to prevent foreseeable harm.

8. Control Through Compensation

Compensation performs both a corrective and behavioral function.

The injured party receives compensation, while the person responsible bears the financial consequences.

Thus:

Compensation converts unlawful conduct into an economic cost.

This encourages future compliance.

Modern UAE law also develops compensation principles by recognising circumstances in which assessed compensation may not fully cover additional material or moral harm. The 2025 Civil Transactions Law expressly introduced reforms concerning compensation and full reparation.

9. Control Through Restitution and Unjust Enrichment

Private law also discourages individuals from retaining benefits obtained without lawful justification.

The former Civil Transactions Law contained detailed rules against unjust enrichment, including restitution where a person acquired another's property without lawful cause.

The behavioral message is:

You cannot keep an unjustified benefit merely because you succeeded in obtaining it.

This encourages:

• honest transactions;
• proper accounting;
• return of mistaken payments;
• restoration of property;
• avoidance of opportunistic conduct.

10. Control Through Public Order

Private autonomy is not unlimited.

Parties may generally arrange their private affairs, but their agreement cannot override mandatory rules protecting fundamental legal interests.

Public-order rules therefore operate as a boundary around private autonomy.

A contractual clause may be ineffective where it conflicts with mandatory law or public order.

UAE jurisprudence recognises that public-order issues may be considered by courts even without a party specifically raising them. The UAE Federal Supreme Court has expressly treated public order as a matter that can be addressed by the court on its own initiative in appropriate circumstances.

Behavioral function

Public order tells private parties:

“Freedom of contract exists, but it operates within mandatory legal boundaries.”

11. Control Through Protection of Vulnerable Persons

Modern private law does not assume that every person has equal bargaining power or equal capacity.

The new UAE Civil Transactions Law introduces modern provisions concerning:

• legal capacity;
• minors;
• persons requiring assistance;
• protection against exploitation;
• judicial assistance;
• informed decision-making.

The new law reduces the general age of majority to 18 Gregorian years and introduces judicial assistance mechanisms for persons unable to adequately express their will.

This demonstrates a modern behavioral objective:

Private law should protect autonomy without permitting exploitation of vulnerability.

12. Control Through Pre-Contractual Disclosure

Modern private law increasingly controls behavior before a contract is concluded.

The new UAE Civil Transactions Law introduces rules concerning pre-contractual negotiations and requires disclosure of fundamental information so that contractual decisions can be made on an informed basis.

This changes the behavioral model from:

“Sign first and litigate later.”

to:

“Disclose important information and negotiate responsibly before contracting.”

This is especially important for:

• complex commercial transactions;
• investment agreements;
• construction;
• real estate;
• technology transactions;
• financial contracts.

13. Control Through Judicial Remedies

Private law influences behavior through the remedies courts can provide.

Important remedies include:

1. Specific performance

Encourages actual performance.

2. Rescission/termination

Discourages serious contractual breach.

3. Compensation

Makes harmful conduct financially consequential.

4. Restitution

Removes unjust benefits.

5. Injunction-type protection

Prevents continuing or imminent interference.

6. Declaration

Clarifies legal rights and obligations.

The new Civil Transactions Law modernises contractual termination and provides rules concerning breach, rescission, force majeure and consequences of rescission.

14. Behavioral Control and Economic Efficiency

Private law also controls behavior by allocating economic risks.

For example:

Thus, private law can be understood as an incentive system.

15. Behavioral Control and Digital Transactions

Modern private law increasingly applies to:

• electronic contracts;
• online platforms;
• digital payments;
• automated transactions;
• AI-assisted contracting;
• electronic evidence;
• digital assets.

The basic principle remains:

Technology changes the method of conduct, but it does not automatically eliminate legal responsibility.

For example, if an automated system terminates a contract, the legal question remains whether the underlying termination was permitted by:

• the contract;
• mandatory law;
• good faith;
• applicable procedural requirements.

Therefore:

Automatic action ≠ automatically lawful action.

16. Behavioral Control and Corporate Conduct

Private law also influences shareholders, directors and companies.

It encourages:

• proper corporate governance;
• respect for separate legal personality;
• protection of company property;
• compliance with contractual obligations;
• proper exercise of shareholder rights;
• avoidance of fraud and abuse.

This is important because corporate entities can have enormous economic power.

Private law therefore attempts to ensure:

Corporate freedom without unlimited corporate abuse.

17. At Least 6 UAE Case Laws

Case 1: Dubai Court of Cassation — Judgment No. 288 of 2025

Principle

The decision is cited in UAE-law analysis concerning good-faith contractual performance.

The principle is that good faith requires more than merely following the literal words of a contract. It includes honest performance, avoidance of deceptive conduct, cooperation where necessary and avoidance of abusive conduct.

The case is particularly useful for explaining behavioral control because it demonstrates how good faith can influence the manner in which contractual rights are exercised.

Behavioral significance

It encourages parties to behave honestly and prevents purely technical exploitation of contractual rights.

Case 2: Abu Dhabi Court of Cassation — Case No. 55 of 2016

This authority is frequently discussed in connection with the UAE abuse-of-rights doctrine under former Article 106.

Principle

The existence of a legal right does not necessarily mean that every exercise of that right is lawful. The statutory circumstances of abuse must be considered.

Behavioral significance

It discourages parties from using legal rights for improper purposes and demonstrates that private autonomy is subject to legal limits.

The case was also considered in the ADGM's NMC Healthcare judgment as part of UAE jurisprudence on Article 106.

Case 3: UAE Federal Supreme Court — Case No. 524 of 2000

This is among the UAE authorities cited in later judicial analysis concerning UAE civil-law principles, including limits on private rights and restitution-related doctrines.

Principle

Civil rights operate within the wider framework of statutory obligations and legal limits.

Behavioral significance

The case illustrates that private-law rights are not completely isolated from broader principles of lawful conduct.

The authority was specifically identified among UAE cases considered in the NMC Healthcare judgment concerning UAE civil-law doctrines.

Case 4: Dubai Court of Cassation — Case No. 389 of 2001

This authority is among the UAE judicial decisions cited in connection with civil-law principles concerning unjust enrichment and related private-law obligations.

Principle

A person should not obtain or retain a legally unjustified benefit at another person's expense.

Behavioral significance

Restitution acts as a behavioral control mechanism by discouraging opportunistic acquisition or retention of another person's property or benefit.

The case is identified among the UAE authorities considered in NMC Healthcare's analysis of UAE law.

Case 5: UAE Federal Supreme Court — Case No. 52 of 29, 30 September 2009

This authority forms part of the Federal Supreme Court's civil-law jurisprudence concerning private rights and civil responsibility.

Principle

The exercise and consequences of private rights must be assessed within the applicable legal framework rather than merely by looking at the formal existence of a right.

Behavioral significance

It supports the wider idea that private law channels individual conduct toward legally acceptable behavior.

This authority is listed among UAE civil-law decisions considered in subsequent UAE-law analysis.

Case 6: Dubai Court of Cassation — Case No. 77 of 2011

This case concerned a construction/work contract and the consequences of defective performance.

The judicial principle discussed in later UAE-law proceedings was that where completed work is defective, the owner may seek appropriate contractual remedies, including requiring repair or, where legally justified, termination or completion through another contractor at the original contractor's expense.

Behavioral significance

The rule creates a powerful incentive for contractors to:

• follow contractual specifications;
• complete work properly;
• repair defects;
• respect reasonable contractual standards.

Thus, remedies function as behavioral control.

Case 7: UAE Federal Supreme Court — Cassation No. 250 of 2020

The Federal Supreme Court recognised the importance of public order and stated that courts may address public-order matters on their own initiative where appropriate.

Behavioral significance

Public-order rules prevent parties from using private arrangements to circumvent mandatory legal principles.

This is an important limitation on freedom of contract.

Case 8: UAE Federal Supreme Court — Judgment concerning Article 282 Civil Transactions Law

UAE Federal Supreme Court jurisprudence has recognised the requirements of civil liability involving fault, damage and causation, while distinguishing direct harmful conduct from causative conduct.

Behavioral significance

The possibility of civil liability encourages individuals and businesses to take reasonable care and avoid foreseeable harm.

18. The Behavioral Control Model

The UAE private-law system can be represented as:

Private freedom

↓

Legal standards

↓

Expected behavior

↓

Violation

↓

Legal consequence

↓

Behavioral correction

For example:

Contract → Good faith → Proper performance → Breach → Compensation/termination → Future compliance

19. Difference Between Behavioral Control and Punishment

Private law should not be confused with criminal law.

However, private law can still have a deterrent effect.

20. Modern UAE Approach: Balance Between Freedom and Control

The modern UAE approach attempts to balance two apparently competing principles:

Individual autonomy

People should be free to:

• contract;
• own property;
• conduct business;
• transfer rights;
• organise their affairs.

Social/legal protection

That freedom must operate subject to:

• good faith;
• public order;
• mandatory law;
• protection of vulnerable persons;
• compensation;
• restitution;
• prevention of abuse.

The UAE Government describes the new Civil Transactions Law as seeking to balance individual freedom with safeguards against exploitation and harm.

21. Practical Example

Suppose Company A enters into a five-year supply agreement with Company B.

Company A discovers that B has made a minor technical error.

Instead of giving B a reasonable opportunity to correct it, A immediately invokes a termination clause solely to escape the contract because market prices have changed.

A court may need to consider:

1. What does the contract say?
2. Is the termination clause valid?
3. Was the breach material?
4. Was notice required?
5. Was there an opportunity to cure?
6. Was the contractual power exercised in good faith?
7. Was the exercise abusive?
8. What remedy is appropriate?

This demonstrates behavioral control: private law does not merely ask “Does A have a contractual clause?” It can also ask “How was that legal power exercised?”

22. Key Functions — Short List

The behavioral-control functions of modern UAE private law include:

1. Directing contractual behavior
2. Promoting good faith
3. Preventing abuse of rights
4. Discouraging negligence
5. Compensating victims
6. Preventing unjust enrichment
7. Protecting vulnerable persons
8. Controlling unfair exploitation
9. Maintaining public order
10. Encouraging disclosure
11. Allocating economic risks
12. Promoting commercial certainty
13. Encouraging proper corporate conduct
14. Regulating digital and technological transactions
15. Preventing repetitive or abusive litigation

23. Exam-Ready Definition

The behavioral control function of modern private law refers to the capacity of private-law rules to influence and regulate the conduct of individuals and private entities by establishing standards of behavior and attaching legal consequences to breach. In the UAE, this function operates through contract, good faith, abuse of rights, tort liability, compensation, restitution, public order, protection of vulnerable persons and judicial remedies.

24. Conclusion

The behavioral control function of modern private law in the UAE is broader than simply resolving disputes. UAE private law seeks to shape responsible private conduct before disputes arise.

Its principal mechanisms are:

contract + good faith + reasonable conduct + public order + liability + compensation + restitution + judicial remedies.

The new UAE Civil Transactions Law reinforces this modern approach by emphasising legal certainty, informed contractual decision-making, protection against exploitation, good-faith relationships and appropriate judicial remedies.

Therefore, modern UAE private law can be understood as both a system of rights and remedies and a system for guiding private behavior toward honesty, responsibility, fairness, stability and lawful economic activity.

Important note: Several of the older UAE case-law authorities above arose under the former 1985 Civil Transactions Law. Because the new Civil Transactions Law took effect on 1 June 2026, the precise statutory provision applicable to a particular transaction should be checked against the transaction date and the new law's transitional rules.