Contracts - Construction - Factory - Advance Payment
Termination of Industrial Contract and Recovery of Advance Payment
This matter concerns an industrial contract dispute where performance stalled after an advance payment of SAR 470,000. CounselO reviewed the file and concluded the client was entitled to terminate the contract and recover the payment; the commercial court so ruled.
Completed
August 2026
Jurisdiction
Saudi Arabia
Work type
Contracts - Construction - Factory - Advance Payment
Document language
Arabic
Client type
Factory
The matter
Issue: Does the entity have the right to terminate the contract and recover SAR 470,000 after non-performance, despite the contractor's claim that delay was due to lack of site delivery or technical requirements?
Challenge: Prove that the non-performance constitutes a fundamental breach by the contractor, and that retention of the advance is unjustified because there were no actual works or documented costs corresponding to the amount, countering the contractor's defense blaming the project owner.
Work performed
CounselO reviewed the contract and correspondence between the parties, analyzed the causes of execution failure, and examined the client's entitlement to terminate the contract and recover the advance payment. It focused on proving the contractor did not perform actual works or provide sufficient justification to retain SAR 470,000 and established the legal basis for the refund claim.
Outcome or value delivered
Result: The court terminated the contract and ordered the contractor to return SAR 470,000 to the client.
CounselO's contribution: CounselO provided a clear legal analysis that helped build a robust claim and demonstrate that the contractor's retention of the amount was unjustified due to lack of actual performance or documented costs.
This sample demonstrates professional experience only. Details may be modified or withheld to protect confidentiality, and past work or outcomes do not guarantee the result of another matter.