Claim No: CFI 027/2012
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE COURT OF FIRST INSTANCE
BEFORE H.E. JUSTICE ALI AL MADHANI
|CHRISTOPHER JAMES MCDUFF
KBH KAANUUN LIMITED
REASONS FOR JUDGMENT OF H.E. JUSTICE ALI AL MADHANI
1. On 31 July 2012 Application Notice CFI 027/2012/01 was filed on behalf of the Claimant.
2. On 7 August 2012 Application Notice No. CFI 027/2012/02 was filed on behalf of the Defendant.
3. On 9 August 2012 the Registry issued my Judgment which provided the determination of Application Notices CFI 027/2012/01 & CFI 027/2012/02.
4. On 21 August 2012 the Defendant requested for Reasons as to the Judgment of 9 August 2012, as such I provide the following Reasons:
5. The Claimant is an ex-employee of the Defendant, which is a legal consultancy firm in Dubai.
6. In Application Notice CFI 027/2012/1 the Claimant alleges that after receiving a termination letter from his employer as a result of submitting his notice of resignation, the Defendant refused to allow him to cancel his visa under the latter’s sponsorship in order that it could be transferred to another employer. Accordingly the Claimant seeks a court order that his residence visa, sponsored by the DIFC pursuant to his employment with the Defendant, be immediately cancelled so that he can apply for a new non-DIFC residence visa sponsored by his new employer, Galadari & Associates.
7. The Defendant brought its Application Notice CFI 027/2012/2 in opposition to the Claimant’s application on the following basis:
(a) The evidence adduced by the Claimant does not show there to exist a binding contract to work with Galadari & Associates;
(b) even if a binding contract can be said to exist, under the terms of the Letter of Offer (CJM 3rd pp 10 to 14) the Claimant’s employment can be terminated by either party in the three month probation period without any notice and after the probation period on only one month’s notice;
(c) The Claimant, being an Australian national, has no ties with the UAE to keep him here and in the event of having no alternative employment or source of income can simply abscond leaving behind a large unsatisfied claim and substantial legal costs exposure. It is interesting to note that the Claimant has not exhibited in his evidence copies of any of his bank statements for any bank accounts whether inside or outside of the UAE.
(d) in his own evidence (CJM 1st paragraphs 26 and 27, p8) the Claimant has stated that he fears the bouncing of post-dated cheques he has given for his rent, car and credit card loans which shows that he is more likely to leave the country if he cannot meet his financial commitments;
(e) The Claimant can be adequately compensated in damages for the relief if it is found at eventual trial that he was entitled to the relief he is now seeking;
(f) The Defendant cannot be adequately compensated in damages at eventual trial if the Claimant has left the UAE;
(g) The balance of convenience is in maintaining the status quo in favour of the Defendant.
8. In the event that the Court is minded to grant the Claimant the relief he seeks in Application Notice CFI 027/2012/1, the Defendant seeks a further Order that the Claimant be required to deposit his passport with the new residence visa with the DIFC Courts and be prevented from leaving the UAE without the permission of the Court.
The Claimant’s Arguments
9. The Claimant argues that the reason for him to bring such an application is that after his employment relationship came to an end, he wanted to join another law firm in Dubai, but he cannot do so without cancelling or transferring his visa to his new employer’s sponsorship.
10. The Defendant’s unreasonable refusal to allow him to join another employer, by not responding to the visa issue, means he would lose an employment opportunity and stay unemployed and without a source of income to enable him to pay his obligations and cover his daily expenses until the proceedings come to an end.
11. The Claimant asserts that ordering the Defendant to cancel or transfer his visa, thereby allowing him to work, would help his financial position and enable him to pay any money that the Court might eventually order in favour of the Defendant.
The Defendant’s Arguments
The Defendant argued, inter alia, as follows:
12. “The Defendant has a substantial counterclaim against the Claimant set out in the Claimant’s termination letter dated 29 July 2012 which will mean that the sums payable by the Claimant to the Defendant are significantly greater than any sums claimed by the Claimant.
13. If the Claimant’s passport is not delivered up and /or he is not prevented from leaving the UAE, there is a real risk that the Claimant, who is an Australian national, will leave the country or abscond prior to the conclusion of these proceedings, rendering any enforcement of an order against him extremely difficult if not impossible.”
14. The Defendant further argues that the Claimant’s application is in effect seeking a mandatory injunction for the Defendant to undertake an action according to RDC 25.1
, and that the principles relevant to the granting of interim injunctions have been laid down by the English House of Lords in the seminal case of American Cyanamid v Ethicon Ltd. As per Lord Diplock, there are five matters which the Court should consider:
(a) Is there a serious question to be tried;
(b) The adequacy of damages to the Claimant;
(c) The adequacy of damages to the Defendant;
(d) The balance of convenience;
(e) Any undertaking in damages.
15. According to the Defendant, none of the above conditions had been met in the Claimant’s application.
16. Therefore, the Defendant asked for the Claimant’s Application No. 27/2012/1 to be rejected, or alternatively, that the Court grant the application but subject to an order that the Claimant deliver up to the Court his passport and be prohibited from leaving the UAE without the prior permission of the Court.
The Claimant’s Application
17. It is evident from both parties’ submissions that the employment contract came to an end, be it by termination or letter of resignation. It is also very well known to both parties that an employment visa is associated with an employment relationship, the cancellation of an employment visa or its transfer is basically a legal and natural consequence of the termination of an employment relationship.
18. Accordingly, an employer’s refusal to allow an employee to find alternative work with another sponsor after terminating his contract cannot be seen as anything other than unjustifiable and unreasonable behaviour.
19. The argument laid down by the Defendant that the evidence adduced by the Claimant does not show there to exist a binding contract to work with Galadari & Associates or, even if a binding contract can be said to exist, under the terms of the Letter of Offer the Claimant’s employment can be terminated by either party in the three month probation period without any notice and after the probation period on only one month’s notice, cannot be right. As it has been said above the cancellation of the employment visa or its transfer is basically a legal and natural consequence of the termination of the employment relationship. Therefore, it is irrelevant whether the Claimant got an offer (for employment) or not, save for challenging how good or serious that offer was. Furthermore, it would be unfair for the employer to terminate the Claimant’s contract with the aim of hindering their ability to attain alternative employment.
20. The Court has noted the Defendant’s allegation that the Claimant, being an Australian national, has no ties with the UAE to keep him here and in the event of having no alternative employment or source of income could simply abscond, leaving behind a large unsatisfied claim and substantial legal costs exposure, which has been supported by his own evidence when he stated that he fears the bouncing of post-dated cheques he has given for his rent car and credit card loans which shows that he is more likely to leave the country if he cannot meet these payments.
21. The Court considers the above to have been a foreseeable risk that the Defendant has taken, by first recruiting the Claimant and then by terminating his contract. However, what the Defendant is purporting to do by not cancelling the Claimant’s visa could never improve the situation. It would rather make it worse by keeping the Claimant without work and preventing him from earning a living in the interim which would deprive the Defendant of any means against which any eventual Court judgment could be enforced. The Defendant’s behaviour would also create an imbalance between the parties when it comes to proceeding funding as it goes along.
22. As regards the Defendant’s argument that the Claimant is seeking a mandatory injunction for the Defendant to undertake an action according to RDC 25.1
, and that the principles underpinning the granting of interim injunctions, which have been laid down by the English House of Lords in the case of American Cyanamid v Ethicon Ltd
have not been met, therefore the Court should not grant the Claimant the relief he seeks. The Court finds the following:
23. What the Defendant is arguing on this point is that the application for visa cancellation is an interim remedy. Reference is then made to the precedent cited above in arguing that the Court should refuse to grant the remedy sought by the Claimant as it fails to meet the relevant criteria.
24. Although the precedent referred to by the Defendant does set the criteria to be followed when deciding whether or not to grant an interim remedy, however, the subject matter presently in issue is not interim in nature — whereby the Court’s role is to regulate the parties’ position pending trial and to maintain the status quo until the case has been finally resolved at trial. The Claimant’s application rather calls upon the Court to make a final and determinative decision which has no bearing on the future progress of the proceedings.
25. The Court considers the Claimant’s Application Notice CFI 027/2012/1 for the cancellation of his visa to be an ordinary application under RDC Part 23
and not as an interim injunction.
26. For the above mentioned reasons, the Claimant’s Application Notice CFI 027/2012/1 for his residence visa sponsored by the Defendant to be cancelled is granted.
The Defendant’s Application
27. The objective of the Defendant’s Application Notice CFI 027/2012/2 is that in the event that the Court is minded to grant the Claimant the relief he seeks in Application No. 27/2012/1, the Defendant seeks a further Order that the Claimant be required to deposit his passport with the new residence visa with the DIFC Courts and be prevented from leaving the UAE without the permission of the Court pursuant to RDC 25.1
28. The grounds for this application by the Defendant is that they believe that the employment contract was terminated reasonably and that the Claimant was entitled to only one month’s salary in the sum of AED 36,230, and AED 3,748 leave balance. However, there should be deductions of over AED 100,000 which is due to the Defendant and since the Claimant is an Australian national there is a real risk that he would leave the country, leaving no security against which the Defendant could enforce the balance of what is due to them, plus their litigation costs.
29. According to the Claim Form filed on 25 July 2012, the Claimant is seeking three months’ salary in the sum of AED 114,000 as he had submitted his resignation, and the last date of his work would have been 30 September 2012. The Claimant admitted that the Defendant was entitled to AED 30,000 as a loan deduction only.
30. In his Defence and Witness Statement the Claimant contests the legitimacy of the deductions sought by the Defendant — apart from the AED 30,000 loan, and describes them as purported deductions, unlawful and prevented by legislation as he alleges they are all attempts by the Defendant to recover their employment recruitment fees and costs.
31. Furthermore, it is clear from the document dated 29 July 2012 submitted by the Defendant entitled “Leaving Certificate”, that most of what the Defendant is claiming is recovery of their employment fees and costs, in addition to the AED 30,000 loan that the Claimant admits.
Is there any real risk of the Claimant absconding?
32. The Court notes, at the outset, that the Claimant works in a legal capacity and that he himself has approached the Court in order to vindicate his rights, whilst he was at all material times in possession of his passport and could have left the country at any time prior.
33. This Court takes the view that being a foreigner does not in itself pose a risk of absconding, unless supported by reasonable grounds to demonstrate that intention on the Claimant’s side.
34. Not having money or assets currently is not a risk either, and if any risk does exist, the Claimant ascribes it to the Defendant’s actions, but in any event it could be a motive for the Claimant to find alternative employment and funding, which he is now doing — as discussed in the Court’s treatment of the first application above.
35. According to the submissions before the Court, nothing in the Defendant’s papers indicate that the balance of convenience in maintaining the status quo lies with the Defendant. Moreover, no claim has yet been lodged by the Defendant that would, which limits the Court in its estimation of the Claimant’s risk of absconding by having regard to the financial remedies sought by each party.
36. The Claimant’s profession suggests that he is a Court Officer — which would minimise his risk of absconding if not discounting it completely.
37. For the above reasons, the Court finds no real risk of the Claimant absconding and, therefore, dismisses the Defendant’s Application that the Claimant be ordered to deliver his passport to the Court and that he be prevented from leaving the country without the Court’s permission.
38. The cost of the two applications to be determined at the final hearing or in the case.
H.E. Justice Ali Al Madhani
Date of Issue: 24 February 2013