Incapacity is not death, and the documents differ

Death is the event the succession provisions describe most fully. Incapacity is a different event. It is not marked by a certificate, it can be partial or temporary, and it can last for years while a business continues to need signatures.

Agency does not survive it. Under the Civil Transactions Law, an agency is extinguished by the death of the principal or their loss of legal capacity, even where a right of a third party attaches to it, with a narrow exception for an agency to sell a pledged item, and it is likewise extinguished by the death or loss of legal capacity of the agent (Article 897). A power of attorney therefore ceases to operate on the loss of capacity of the person who gave it.

A supervised process operates in its place. A person suffering from insanity or mental incapacity is interdicted by operation of law, acts concluded after the interdiction decision are void, and acts concluded before it are not void unless the condition was notorious at the time of contracting or the other party was aware of it (Article 154).

The Personal Status Law describes who then acts. A father may appoint a tutor to manage the affairs of a minor, a person of unsound mind or a fetus, on the father's inability or after his death, and the court may also appoint one (Article 126). The court appoints a trustee to manage the property and affairs of an incapacitated prodigal or inadvertent person, by order on a petition notified to the Public Prosecution and to the potential heirs (Article 127). Where a person who has reached majority is of incomplete capacity or is not trustworthy over their money, the guardian or tutor appointed by the court applies to the court to consider continuation of the arrangement (Article 157). The Civil Transactions Law refers guardianship, tutorship, curatorship and other systems protecting persons lacking or of limited capacity to the law of the person to be protected (Article 16).

On the company side, incapacity is addressed by the articles of association or not at all. Federal Decree-Law No. 37 of 2022 provides that the character of the family business is not extinguished by the death, interdiction, bankruptcy or insolvency of one of the partners, unless otherwise agreed in the articles of association (Article 23(3)). A director or board member is to be of full capacity (Article 14(4)). The provision placing the director in the position of trustee over a deceased partner's shares addresses death and not incapacity (Article 15(2)). Family businesses are subject to the Commercial Companies Law and other applicable legislation in everything not specifically provided for in that decree-law (Article 26). For companies formed under the Civil Transactions Law, that law treats interdiction alongside death as a ground of dissolution, while permitting agreement that the company continues among the remaining partners, in which case that partner or their heirs are entitled only to their share in the company's assets, valued as at the date of the event and paid in cash (Article 625).

Wills do not reach the problem, by construction. A will is a legal disposition contingent on the death of the testator (Personal Status Law, Article 171(1)). The guardianship power in the DIFC Wills and Probate Registry Rules concerns a minor child who habitually resides with the testator in Dubai or Ras Al Khaimah, takes effect only where there is no other parent or guardian of the child alive at the date of the testator's death, and is invalid where the appointment would be contrary to the law and public order of the UAE (Rule 86). The Registrar is under no duty to check or ascertain the mental capacity of a testator, although a suitable report may be requested (Rule 10(5)), and Dubai Law No. 15 of 2017 requires the testator to be of full capacity and not under interdiction for prodigality or imbecility, unless the will is made for charitable purposes and his guardian obtains the approval of the competent court (Article 9(a)).

In the texts above, death is addressed by inheritance law and incapacity by the courts, and the interim position inside a company is addressed only where the articles of association deal with it.

Sources, retrieved 11 August 2026:

• Civil Transactions Law, Federal Decree by Law No. 25 of 2025: https://uaelegislation.gov.ae/en/legislations/4011
• Personal Status Law: https://uaelegislation.gov.ae/en/legislations/2770
• Federal Decree-Law No. 37 of 2022 on Family Businesses: https://uaelegislation.gov.ae/en/legislations/1608
• Dubai Law No. 15 of 2017: https://dlp.dubai.gov.ae/Legislation%20Reference/2017/Law%20No.%20(15)%20of%202017.html
• DIFC Wills and Probate Registry Rules, version updated 30 June 2019: https://www.difccourts.ae/application/files/6916/0474/0825/DIFC-Wills-and-Probate-Registry-Rules-updated-30-June-2019.pdf

This article is educational. It is written with law firms and describes mechanisms in general terms, and the programme has not verified or endorsed any structure described here. A family should take its own legal, tax and Sharia advice.