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DNB Bank ASA v (1) Gulf Eyadah Corporation (2) Gulf Navigation Holding Pjsc [2014] DIFC CFI 043

DNB Bank ASA v (1) Gulf Eyadah Corporation (2) Gulf Navigation Holding Pjsc [2014] DIFC CFI 043

July 2, 2015

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Claim No: CFI-043-2014

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

In the name of His Highness Sheikh Mohammad Bin Rashid Al Maktoum, Ruler of Dubai

 

IN THE COURT OF FIRST INSTANCE

BEFORE H.E. JUSTICE ALI AL MADHANI

 

BETWEEN

DNB BANK ASA

Claimant

and

 

(1)  GULF EYADAH CORPORATION

(2)  GULF NAVIGATION HOLDING PJSC

Defendants

           

 

Hearing:            16 March 2015

Counsel:           Robert Karrar-Lewsley assisted by Tarek Shrayh (Al Tamimi & Co) for the Claimant

Harris Bor ( Fichte & Co.) for the Defendant

Judgment:        2 July 2015


JUDGMENT OF H.E. JUSTICE ALI AL MADHANI


 

Reasons for Judgment determining the Application CFI-043-2014 submitted by the Defendants (“Gulf”) challenging the jurisdiction of the DIFC Courts

Summary of Judgment

The Claimant, DNB Bank ASA, seeks recognition and enforcement of a judgment order issued on 30 September 2014 in the English High Court of Justice that requires the Defendants, Gulf Eyadah Corporation and Gulf Navigation Holding PJSC to pay USD 8.7 million plus costs under various finance documents. The Defendants contest the DIFC Courts’ jurisdiction to enforce a foreign court judgment on the basis that none of the jurisdictional “gateways” under Article 5(A) of the Judicial Authority Law, Dubai Law No. 12 of 2004, as amended by Law No. 16 of 2011, are satisfied. Alternatively, the Defendants also argue that the Claimant’s claim constitutes an abuse of process and finally, seek to have the claim determined in private and/or for their details to be anonymised in any judgment pursuant to RDC Rule 35.4.

As for the jurisdiction argument, Justice Ali Al Madhani concludes that the English order constitutes a “foreign” court order within the meaning of Article 7(6) of the Judicial Authority Law No. 12 of 2004 as amended by Law No. 16 of 2011 and Article 24(1) of the DIFC Court Law No. 10 of 2004. The order falls under the conferred jurisdiction according to the meaning of Article 5(A)(1)(e) and therefore the jurisdictional “gateway” is satisfied. Accordingly, the judgment order must be accepted by the Court for recognition or execution within the DIFC in accordance with the Rules of the DIFC Courts (RDC).

It was also held that the abuse of power argument was without merit. Although the Court has jurisdiction to enforce and recognise foreign judgments, that power rests within the DIFC and cannot be transferred to refer recognised foreign judgments to the Dubai Courts for execution.

Lastly, it was ruled that the Defendants had failed to satisfy the test in RDC 35.4(3) as well as the precedent set by Arqaam Capital Ltd v DFSA (CFI 006/2010) in regards to the issue of privacy. The Defendants did not challenge the evidence set forth by the Claimant that the English Commercial Court Order is a public order devoid of any secret or sensitive information that requires protection.

Having ruled for the Claimant in all three parts of the Claim, the Defendants are to bear the costs of the application.

  This summary is not part of the Judgment and should not be cited as such

 

JUDGMENT

UPON hearing Counsel for the Claimant and Counsel for the Defendant at the hearing on 16 March 2015

AND UPON reading the submissions and evidence filed and recorded on the Court file

IT IS HEREBY ORDERED THAT:

1. The Defendants’ application to contest jurisdiction is dismissed.

2. Costs shall be paid to the Claimant by the Defendant on a standard basis, the amount of which shall be assessed, if not agreed, by the Registrar.

 

Issued by:

Natasha Bakirci

Assistant Registrar

Date of Issue: 2 July 2015

At: 3pm 

 

 

Background

1. On 3 December 2014, the Claimant lodged a Claim with the DIFC Courts seeking the “recognition and enforcement” of the Judgment Order issued on 30 September 2014 by Mr Justice Cooke of the English High Court of Justice, Queen’s Bench Division, Commercial Court requiring the Defendants to pay USD 8.7m plus costs under various finance documents and a guarantee (the “Commercial Court Order”).

2. The Defendants contest the DIFC Courts’ jurisdiction to enforce a foreign court judgment on the basis that none of the jurisdiction gateways under Article 5(A) of the Judicial Authority Law (Dubai Law No. 12 of 2004, as amended by Dubai Law No. 16 of 2011) are satisfied.

3. The Defendants alternatively argue that the Claimant’s claim constitutes an abuse of the DIFC Courts process. The Defendants further seek, pursuant to RDC Rule 35.4, to have the claim determined in private and/or for their details to be anonymised in any Judgment.

4. As mentioned above, the Defendants’ application contains three main issues or parts which I will deal with in the following order;

a. Jurisdiction

b. Abuse of Process

c. Privacy

5. In this order I will summarise the parties’ arguments followed by my decision in each part.

Jurisdiction 

 The Claimant’s Grounds for Bringing the Claim Before this Court

6. Although the application to challenge jurisdiction is brought by the Defendants, I find it more sensible to start by laying down the Claimant’s grounds for attempting to recognise and enforce the English Judgment before this Court, before I summarise the Defendants’ arguments in their cross-application contesting the jurisdiction of this Court.

7. The main ground upon which the Claimant brings their Claim Form for recognition and enforcement of the English Court judgment before this Court is Article 7(6) of the Judicial Authority Law No. 12 of 2004, as amended by Law No. 16 of 2011, which makes the recognition and enforcement of foreign court judgments mandatory within the DIFC (subject to the RDC), and therefore grants the DIFC Courts jurisdiction to enforce such judgments.

8. Article 7(6) reads as follows:

“The judgments, decisions, orders and ratified Arbitral Awards rendered outside DIFC by any court other than Dubai Courts shall be executed within DIFC in accordance with the procedure prescribed in the Rules of Court”.

9. Based on the above Article, the Claimant contends that the English Commercial Court Order is an order of a court other than the Dubai Courts, and so falls within the meaning of Article 7(6) of the Judicial Authority Law. The DIFC Courts not only have jurisdiction to enforce the EnglishCommercial Court Order, but are compelled to do so by the mandatory language (‘shall be executed’) of that Article.

10. The Claimant’s second ground is that Article 24(1) of the DIFC Court Law No. 10 of 2004 confers jurisdiction on this Court to ratify foreign court orders when it states that:

“(1) Pursuant to Article 7(4) of the Judicial Authority Law, the Court of First Instance has jurisdiction to ratify any judgment, order or award of any recognised:

(a) Foreign court;”

11. The reference to Article 7(4) of the Judicial Authority Law is the original version of that law, before it was amended by Dubai Law No. 16 of  2011, which stated that ‘Judgments, awards, and orders of any court outside of the Centre may be enforced within the Centre in the manner prescribed in the Centre’s Laws’.

12. The 2011 amendment of the Judicial Authority Law,Dubai Law No. 16 means that the reference to Article 7(4) of the Judicial Authority Law in the DIFC Court Law is no longer applicable and that reference to Article 7(4) in the Law should be changed to the new Article 7(6). Accordingly, one can read Article 24(1) of the DIFC Court Law No. 10 of 2004 with the correct reference, thereby maintaining its original purpose and effect of reflecting and confirming the jurisdiction given to the DIFC Courts to enforce foreign judgments under the Judicial Authority Law.

13. The Claimant further argues that the Gateways are not the only means by which the DIFC Courts can have jurisdiction. Other laws may also grant jurisdiction, as the Deputy Chief Justice pointed out, when this Court was asked to recognise and enforce foreign arbitral awards under the DIFC Arbitration Law (DIFC Law No.1 of 2008). It was argued by the Defendants in that case that such a claim did not fit into any of the jurisdictional gateways and should be dismissed. Sir John Chadwick, held, at paragraph 24 of his judgmentin the case of X1 & X2 v Y1 & Y2 (ARB 002/2013) that,

“in order to determine whether the DIFC Courts have jurisdiction to recognise and enforce foreign arbitral awards it is necessary to ask whether (and to what extent) that jurisdiction is conferred by DIFC Laws.

In relation to recognition, the answer to that question is not in doubt. Article 42(1) of the DIFC Arbitration Law provides that an arbitral award, irrespective of the State or jurisdiction in which it was made ‘shall be recognised as binding within the DIFC…”

14. The Claimant further added that the previous provisions of Article 7(6) of the Judicial Authority Law and 24(1) of the Court Law are reflected in the Gateways themselves. Article 5 of the Judicial Authority Law which provides the jurisdictional gateways states that:

“Article 5(A)(1) The Court of First Instance shall have exclusive jurisdiction to hear and determine:

 (e) Any claim or action over which the Courts have jurisdiction in accordance with DIFC Laws and Regulations”.

15. The word “DIFC Laws” in 5 (A)(1)(e) is defined in Article 2 of the same law to mean ‘any laws issued by the Ruler in relation to DIFC’. The Judicial Authority Law in Article 7(6) explicitly mandates that foreign judgments may be enforced in the DIFC and the same can be said of Article 24(1) of the Court Law. These two Articles give the Courts jurisdiction and also fall within the “gateways” in Article 5(A)(1)(e).

16. The third ground upon which the Claimant brings their Claim is that the DIFC Courts have signed a number of Memoranda of Guidance with foreign courts to facilitate the reciprocal enforcement of judgments. Some of them are specific memoranda that provide guidance in this case, as evidence that the DIFC Courts themselves have jurisdiction to enforce foreign judgements, and that there is nothing in principle that should prevent the Claimant from enforcing the English Order in this case.

The Defendants’ Arguments Challenging Jurisdiction

17. The first argument is that the general jurisdictional principles in regards to recognition and enforcement proceedings under DIFC Law can be found in Corinth Pipeworks SA v Barclays Bank Plc SA 002/2011, at paragraphs 17-18, where the Chief Justice explained the different approaches to jurisdiction taken by the English and DIFC Courts. In England, the Courts operate a discretionary framework where the Court’s permission is needed to serve a claim form outside the jurisdiction (CPR r6.36):

      “In contrast, in the DIFC Courts, service on a defendant outside the jurisdiction    can be effected anywhere in the world provided that the claimant can bring    himself within Article 5(A)(1) of Law No 12. It is then open to a defendant to         challenge the jurisdiction and apply to set aside service on the grounds that the      claim is not covered by Article 5(A)(1)”.

The fact remains that unless the Claimant can show that the claim falls within one or more of the “gateways” listed in Article 5 of the Judicial Authority Law No. 12 of 2004 as amended by Law No. 16 of 2011, the DIFC Court of First Instance cannot exercise jurisdiction to consider the claim.

18. The Defendants assert that none of the “gateways” under Article 5 apply in this case as none of the parties are incorporated, licensed or registered to transact any business in the DIFC, nor do any of them have a physical office or other registered office in the DIFC. The matter does not concern a contract concluded or executed in the DIFC, nor does it involve a transaction or incident otherwise occurring within the DIFC in relation to its activities. There has also been no agreement between the parties to submit the claim or related matter to the jurisdiction of the DIFC Courts. The claim is also not an appeal from a DIFC body.

19. The Defendants even go further to argue that there are no DIFC Laws or DIFC Regulations that can grant jurisdiction under Article 5(A)(1)(e) of the Judicial Authority Law and that the Claimant’s reference to Article 24(1)(a) of the DIFC Court Law (DIFC Law No. 10 of 2004) is misconceived. The Defendants’ reasons are that Article 24(1)(a)  deals with ratification of Judgments in the context of execution. This is obvious from the introduction of the Article which states: “Pursuant to Article 7(4)” which deals with execution in the DIFC against assets in the DIFC. It has been held that the words “pursuant to” mean “for the purpose of” or to “give effect to” ((1) X1, (2) X2 v (1) Y1, (2) Y2, ARB 002/2013, para 8). According to the Defendants, it follows that the DIFC Courts has jurisdiction to ratify a Judgment of a foreign court only for the purposes of execution against assets in the DIFC. It is apparent on the face of the claim itself that the Claimant is not seeking execution in the DIFC, but recognition and enforcement more generally, with reference to the Claim Form, which is a distinct process.

20. The Defendants’ second argument is that the Claimant’s reliance on Article 7(6) of the Judicial Authority Law, Dubai Law No. 16 of 2011 is flawed. Article 7(6) confirms, among other things, that judgments rendered outside the DIFC shall be executed within the DIFC, “in accordance with the procedure prescribed in the Rules of Court”. This is a reference to the Rules of the DIFC Courts (the “RDC”) which confirm at Rule 45.8 that orders from courts other than the DIFC Courts can only be enforced directly if an order requires payment of a sum of money and “an enactment provides that the award may be enforced as if payable under a DIFC Courts order”. There is no enactment providing for English Commercial Court decisions to be enforced as if payable under an order of the DIFC Courts. As confirmed by the Memorandum of Guidance (MOG) with the Commercial Court of England and Wales, the process of recognition of an English Court Judgment involves obtaining a local DIFC Courts Judgment on the back of the English Court Judgment. Article 24(1)(a) cannot have been intended, and therefore cannot be used, to circumvent the process reflected in the MOG.

21. The third argument raised by the Defendants in response to the Claimant’s attempt to rely on the DIFC Courts decisions in Banyan Tree Corporate PTE Ltd v Meydan Group LLC(ARB 003/2013 and CA-005-2014), is that the claim involved the recognition of an arbitration award, a circumstance governed by an express DIFC law (i.e., Articles 42 and 43 of the DIFC Arbitration Law) requiring such recognition in accordance with the New York Convention and that accordingly this case must be distinguished.

22. The last argument in response to the Claimant is an attempt to rely on the Memoranda of Guidance between the DIFC Courts, the English Commercial Court and other courts to establish jurisdiction. It is said that these MOGs are expressed to be non-binding and in any event do not provide the Claimant with any additional mechanism that would not be open to it under the general common law. In this regard, as indicated above, the MOG recognises that nothing in the common law can undermine the need for a party seeking recognition and enforcement to establish jurisdiction. Accordingly, the Defendant concludes that no such jurisdiction can be established in this case.

23. I will entertain the Defendants’ contention that the DIFC Courts’ jurisdiction must be determined in light of Article 5 of the Judicial Authority Law, as it was held by the Chief Justice inCorinth Pipeworks SA v Barclays Bank Plc SA 002/2011 that unless the Claimant can show that the claim falls within one or more of the “gateways” under Article 5, the DIFC Court of First Instance can have no jurisdiction to consider the claim.

24. Article 5(A)(1) provides that:

“Article 5(A)(1) The Court of First Instance shall have exclusive jurisdiction to hear and determine:

 (e) Any claim or action over which the Courts have jurisdiction in accordance with DIFC Laws and Regulations”.

25. The above Article has opened a further jurisdictional gateway to the ones listed in Article 5 (A)(1) of the amended Judicial Authority Law and the new gateway clearly grants jurisdiction conferred by DIFC Laws and regulations.“DIFC Laws” is defined at Article 2 of the Judicial Authority Law No. 12 of 2004 to mean, “any laws issued by the Ruler in relation to DIFC”.

26. In order to determine whether the DIFC Courts have jurisdiction to recognise and execute Foreign Judgments or Orders it is necessary to ask whether (and to what extent) that jurisdiction is conferred by DIFC Laws. The answer lies in Article 7(6) of the Judicial Authority Law No. 12 of 2004, as amended by Law No. 16 of 2011 and Article 24(1) of the DIFC Court Law No. 10 of 2004. Both have conferred jurisdiction to the DIFC Courts to recognise and/or execute Foreign Judgments within the DIFC.

27. Article 7(6)of the Judicial Authority Law No. 12 of 2004, as amended by Law No. 16 of 2011 provide:

“The judgments, decisions, orders and ratified Arbitral Awards rendered outside DIFC by any court other than Dubai Courts shall be executed within DIFC in accordance with the procedure prescribed in the Rules of Court”.

28. In this context I agree with the Claimant’s submissions that there shall be no issue that the same law providing the gateways in 5(A)(1)(e) provides for the conferred jurisdiction as long as it still within the scope of “any laws issued by the Ruler in relation to DIFC”.

29. Furthermore, Article 24(1) of the DIFC Court Law No. 10 of 2004 confers jurisdiction on this Court to ratify foreign court orders when it states that:

‘(1) Pursuant to Article 7(4) of the Judicial Authority Law, the Court of First Instance has jurisdiction to ratify any judgment, order or award of any recognised:

(a) Foreign court;

30. I reject the assertion that Article 7(4) of the Judicial Law, as amended only deals with execution in the DIFC against assets within the DIFC and has nothing to do with Foreign Courts’ Orders. I agree with the Claimant submission that reference to Article 7(4) before the amendment of the Judicial Authority Law in 2011 used to be in reference to the enforcement within the DIFC of judgments and orders of any court outside the DIFC. Now in the amended version of the Law the reference to enforcement of judgments and orders of any court outside the DIFC, within the DIFC became more detailed and contained in Article 7 (4)(5) and (6). Accordingly, the reference to Article 7(4) in Article 24 (1) of the Court Law must now be reference to Article 7 (4)(5) and (6) of the Judicial Authority Law No. 12 of 2004, as amended by Law no. 16 of 2011.

31. I reject the second argument of the Defendants that RDC 45.8 requires that “an enactment provides that the decision may be enforced as if payable under an order of the DIFC Court”. There is no enactment providing for English Commercial Court decisions to be enforced as if payable under an order of the DIFC Courts. In my view this rule is a general rule, with reference drawn in RDC 45.8(1) to awards or decisions made by any court, tribunal, body or person other than the court, which means none of the mentioned awards or decisions would be enforced by the Court if there are no enactments (laws or regulations) referring to them as enforceable. In the current case, we have shown that there is more than one enactment or legal provision referring to foreign court decisions to be enforced within the DIFC and that the English Court order satisfies the test of RDC 45.8.

32. I am in agreement with the Defendants in asserting that the decisions in Banyan Tree Corporate PTE Ltd v Meydan Group LLC (ARB 003/2013 and CA-005-2014), must be distinguished for the reasons provided below under the abuse of process argument.

33. The reference to enforcement of Foreign Court Judgments within the DIFC in the Judicial Authority Law, the Court Law and in the RDC is irrespective of whether there are assets or not within the DIFC. Accordingly, I reject the Defendants’ argument that the Claim should be dismissed for lack of assets within this Court’s jurisdiction.

34. Thus the English order is a “Foreign” court order of a court other than the Dubai Courts (unchallenged fact), and accordingly it falls under the meaning of Article 7(6) of the Judicial Authority Law No. 12 of 2004, as amended by Law No. 16 of 2011 and Article 24(1) of the DIFC Court Law No 10 2004. Its falls under the conferred jurisdiction according to the meaning of Article 5(A)(1)(e), and therefore it must be accepted by the Court for recognition or execution within the DIFC in accordance with the RDC.

Abuse of Process

35. The Defendants’ alternative defence to the jurisdiction challenge is an abuse of process argument. The Defendants assert that, the only reason that the Claimant brings this claim before the DIFC Courts is to avoid filing an application for recognition and enforcement before Dubai Courts.

36. The Defendants argue that according to the principle established by (Demirel v Tasarruf [2007] EWCA Civ 799, para 27) a claimant must show a “real prospect of a legitimate benefit” for a claim for recognition and enforcement of a foreign judgment in order to obtain permission to serve a claim form out of the jurisdiction. The English Court of Appeal appears to accept that there is a need to show assets in the jurisdiction before an action on a Judgment would be permitted (Linsen International Ltd v Humpuss Sea Transport Pte Lte [2011] EWCA Civ 1024).

37. The Defendants insist that they have no assets in the DIFC and that there is no intention to bring any in the future and that the Claimant is only trying to avoid the requirements of the UAE Civil Procedures Code and Dubai Courts, as it applies to execution of foreign judgments, by obtaining enforcement in Dubai through the DIFC Courts.

38. The Defendants also argue in response to the Claimant’s attempts to justify using the DIFC Courts in this way on the basis that the DIFC is an accepted “conduit jurisdiction” and “route into the Emirate of Dubai (and the wider UAE) for the enforcement of international arbitration awards even where the awards have no jurisdictional nexus to the DIFC” (pursuant to the evidence of Mr Shrayh). The Defendants contend that the enforcement of arbitration awards is very different from the enforcement of English Commercial Court Judgments and in any event that this cannot be the right approach, in circumstances where the DIFC Courts itself has no original jurisdiction and there are no assets within the DIFC.

39. In response to the Defendants argument that the application for enforcement is an abuse of process and that the Defendants as a UAE entity are entitled to have enforcement issues considered by the UAE Courts, the Claimant contends that this argument is misconceived and that the DIFC Courts are in fact a UAE Court and they are the only competent Courts to decide the enforcement of foreign judgments within the DIFC, as well as to decide their jurisdiction in such matters. The Dubai Courts have no such jurisdiction within the DIFC.

40. The Claimant added in that context that it has been held in both the Banyan Tree case and XX v YY, that there is no reason why the DIFC cannot be used as a conduit jurisdiction. The DIFC Courts are obliged to enforce foreign court judgments just as they are obliged to enforce foreign arbitral awards (XX v YY) and domestic arbitral awards (Banyan Tree), and this is irrespective of whether there are any assets in the DIFC. If the enforcing party then wishes to seek enforcement in the wider UAE through the existing legal machinery between the Dubai Courts and the DIFC, this is the concern only for the Dubai Courts. See (Banyan Tree paragraphs 41 – 49).

41. I now deal with the Defendants’ alternative abuse of process defence after having decided that this Court has jurisdiction to deal with the Claimant’s Claim for recognition and enforcement of a foreign judgment for the reasons mentioned above.

42. In this alternative defence the Defendants’ core argument in summary is that they reject the idea that the DIFC Courts is a conduit jurisdiction to enforce foreign judgments in the UAE (beyond its jurisdiction) in a case that does not initially have any link with it at all which results in the Second Defendant’s use of available defences to them against the foreign judgments in accordance with the rules applicable in the UAE.

43. We have also seen from the summary of the Claimant’s arguments above that the core opposition against the Defendants’ argument is that there should be no issue with the DIFC Courts being a “Conduit Jurisdiction” making reference to Justice Steel’s Judgment in that regard (Banyan Tree).

44. It is my view that both Parties’ arguments in this regard are misconceived. Unlike the situation in cases where an Arbitral Award is brought for recognition and then for enforcement, Recognised Foreign Judgments or Orders by the DIFC Courts cannot be said to be referred to the Dubai Courts for execution beyond the DIFC jurisdiction.

45. Article 7(2) of the Judicial Authority Law No. 12 of 2004 as amended by Law No. 16 of 2011 provides that:

 “Where the subject matter of execution is situated outside the DIFC, the judgments, decisions and orders rendered by the Courts and the Arbitral Awards ratified by the Courts shall be executed by the competent entity having jurisdiction outside DIFC in accordance with the procedure and rules adopted by such entities in this regard, aswell as with any agreements or memoranda of understanding between the Courts and these entities. Such execution shall be subject to the following conditions.”

46. In this Article there is reference to judgments, decisions and orders rendered by the DIFC Courts and the Arbitral Awards ratified by the DIFC Courts to be referred for execution but no reference at all to any foreign judgment recognised by the DIFC Courts. The Article has excluded Recognised Foreign Judgments from that rule. This is not by mistake, because Articles 7(4) and 7(5) of the said law stated that Dubai Court decisions and Arbitral Awards ratified by the Dubai Courts could be brought for execution in the DIFC but not Foreign Courts Judgments recognised by Dubai Courts.

47. Recognised Foreign Judgments were only mentioned in Article 7(6) as amended:

 “The judgments, decisions, orders and ratified Arbitral Awards rendered outside DIFC by any court other than Dubai Courts shall be executed within DIFC in accordance with the procedure prescribed in the Rules of the Courts.

48. In my view, the meaning of Article 7 of the Judicial Authority Law No. 12 of 2004 as amended by Law No. 16 of 2011 along with Article 24(1) of the Court Law in regards to Foreign Court Judgments is that although this Court may execute judgments, decisions and orders rendered by any Recognised Court other than Dubai Courts, that execution shall not go beyond the jurisdiction of this Court which requires this Court not to refer Recognised Foreign Judgments to the Dubai Court for execution and vice versa.

49. This would surely lead me to say that this Court cannot be said to be a “conduit jurisdiction Court” if the matter before it is related to a Foreign Court Judgment. There shall be no contradiction between my finding and the finding in the Banyan Tree case and XX v YY, since these cases involved Ratified Arbitration Awards that were said to be able to be sent for execution between the DIFC Courts and Dubai Courts according to Article 7(3)(4) and (5).For these reasons one cannot imagine that the DIFC Courts are obliged to enforce foreign court judgments in the same way they are obliged to enforce Foreign Arbitral Awards (XX v YY) or even domestic arbitral awards (Banyan Tree).

50. One might argue that Foreign Judgments or Orders recognised by the DIFC Courts come under the meaning of “the judgments, decisions and orders rendered by the Courts” in Article 7(2) and therefore can be referred to the Dubai Courts for execution. In my view it does not, and if that were the correct approach there would be no need to particularly mention or add “Arbitral Awards ratified by the Courts” in separate words to that provision. The acknowledgment of the “Arbitral Awards ratified by the Courts” means that a distinction must be drawn to what this Court issues or renders (judgments, decisions and orders) by itself and between what is rendered or issued by another court or institution and then brought for recognition or ratification.

51. My interpretation of Article 7 is that a Recognised Foreign Court Judgment or Ratified Arbitral Award cannot be said to be within the meaning of “the judgments, decisions and orders rendered by the Courts.

52. In conclusion, although this Court has jurisdiction to recognise and enforce Foreign Judgments and that power shall be within the DIFC and cannot extend beyond the DIFC, this Court has no power to refer Recognised Foreign Judgments to Dubai Courts for execution. Thus, the argument of abuse of process is without merit and therefore I dismiss it.

Application for Privacy

53. The Defendants further seek, pursuant to RDC Rule 35.4(3), to have the claim determined in private and/or for their details to be anonymised in any Judgment. The main reason for this application is that the Second Defendant is a publicly listed company, and is concerned that if the matter were not private, this might significantly and disproportionality harm its share price. The test set out in Arqaam Capital Ltd v DFSA (CFI 006/2010) is therefore satisfied.

54. The Defendants further contend that if the matter had been brought in the Dubai Courts, as it should have been, they would have benefitted from a privacy order as a matter of course.

55. The Claimant’s position is that this application should be dismissed for two main reasons: The first is that the English Commercial Court Order to be recognised is a public order and there is no secret or sensitive information that requires protection. The second reason is that the English Commercial Court Order is a final judgment against the Defendants. The market and the Defendants’ shareholders should be aware that such an order exists and that enforcement is being sought in the DIFC. This is one of the functions of having public courts. Such transparency should be maintained. The Defendants cannot sensibly argue that they should be protected from the adverse consequences of its own behaviour, and that the market and its shareholders should be kept in the dark. Dealing with this application for privacy obliges this Court to first deal with RDC 35.4(3) and with the precedent of  Arqaam Capital Ltd v DFSA (CFI 006/2010)

56. RDC 35.4(3) provides that:

 ”A hearing or any party of it may be in private if:

(3) it involves confidential information (including information relating to personal financial matters) and publicly would damage that confidentiality .

57. InArqaam Capital Ltd v DFSA (CFI 006/2010) the Deputy Chief Justice John Chadwick laid out the following test before deciding against publicity:

“Whether Arqaam would, or might, suffer harm to its legitimate business interests by the disclosure of confidential information as to its financial position and business activities in advance of a public hearing”.

58. In both RDC 35.4(3) and in Arqaam there are requirements for what constitutes confidential information in order for the Court to protect it by ordering privacy against the general rule that a hearing is to be heard in public.

59. In the present case, on the one hand the Defendants argue that the Second Defendant is a publicly listed company, and is concerned that if the matter were not private, this might significantly and disproportionality harm its share price. On the other hand the Claimant argues that this matter is not confidential, since the English Order is a public document, and therefore no confidential information need be protected (witness statement of Tarek Shrayh at paragraph 45).

60. The Defendants have not challenged the evidence set out by the Claimant or denied the fact that the English Commercial Court order is not public, therefore I do not see in this case or at this level any confidential information that is not already available to the public. Accordingly the Defendants have failed to satisfy the test in both RDC 35.4(3) and in Arqaam and their application for privacy shall be dismissed.

61. Having lost the three parts of this application, the Defendants are to bear the costs of this application on a standard basis to be assessed by the Registrar if not agreed.

Issued by:

Natasha Bakirci

Assistant Registrar

Date of Issue:  2 July 2015

At: 3pm

 

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