Article 278

Where in any suit or proceeding, a party objects to a claim or defense on the ground that it is, in whole or in part, as against the objector, false or vexatious to the knowledge of the party by whom it has been put forward, and such claim or defense is subsequently disallowed, abandoned or withdrawn in whole or in part as against the objector, the court may, if it deems appropriate, and after recording its reasons for holding such claim or defense false or vexatious, issue an order for the payment to the objector, by the party by whom such claim or defense was put forward, of costs by way of compensation up to an amount not exceeding 5,000 Nakfas.

No person against whom an order has been made under this Article shall, by reason thereof, be exempted from criminal proceedings under the Penal Code with respect to any false statement made by him.

The amount of any compensation awarded under this Article shall be taken into account in any subsequent suit for damages or compensation with respect to the claim or defense held to be false or vexatious.