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CFI 009/2016 Vegie Bar LLC v Emirates National Bank of Dubai Properties Pjsc

CFI 009/2016 Vegie Bar LLC v Emirates National Bank of Dubai Properties Pjsc

October 3, 2016

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Claim No: CFI-009-2016

 

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

 

IN THE COURT OF FIRST INSTANCE

BETWEEN

VEGIE BAR LLC

Claimant

and

EMIRATES NATIONAL BANK OF DUBAI PROPERTIES PJSC

Defendant


  ORDER OF H.E. JUSTICE SHAMLAN AL SAWALEHI


UPON reviewing the Claimant’s Claim Form No. CFI-009-2016, issued on 3 March 2016 (the “Claimant’s Claim”) and the Defendant’s Defence of Claim, received on 2 May 2016

AND UPON reviewing the Claimant’s and Defendant’s Case Management Information Sheets submitted on 8 September 2016

AND UPON reviewing the Claimant’s Application No. CFI-009-2016/1 and supporting documents submitted on 4 September 2016, requesting a Non-Party Documentation Order pursuant to RDC 28.51 to 28.54

AND UPON reviewing the Defendant’s Application No. CFI-009-2016/2 and supporting documents submitted on 8 September 2016, requesting that the Claimant pay USD 173,729.00 into Court as security for the Defendant’s costs pursuant to RDC 25.100, or in default of such payment that the Claimant’s Claim be stayed and the Defendant granted permission to apply for the Claimant’s Claim to be dismissed with costs

AND UPON hearing Counsel for the Claimant and Counsel for the Defendant in the Case Management Conference on 20 September 2016

IT IS HEREBY ORDERED THAT:

1.The Claimant’s Application for a Non-Party Documentation Order is denied.

2. The Claimant shall pay USD 86,864.50 into Court within 30 days as security for the Defendant’s costs.

3. The Case Management Timetable shall be issued by Court Order, if not agreed by the parties, within 7 days of receipt of the Claimant’s payment into Court of security for costs.

4. Pursuant to RDC 25.112, in the event of default of payment of security for costs, the Defendant is granted permission to apply to the Court for the case to be stayed.

Issued by:

Natasha Bakirci

Assistant Registrar

Date of issue: 3 October 2016

At: 4pm

SCHEDULE OF REASONS

1.The current Applications arise out of a dispute regarding lease agreements dated 16 August 2010 and 5 April 2011 between the Claimant and Union Properties PJSC for the lease of properties within the DIFC. The freehold of these properties was subsequently sold to the Defendant in March 2012.

2. The Claimant alleges that the sale of the properties was subject to the leasehold interest of the Claimant, yet the Defendant has refused, or otherwise neglected to recognise the Claimant’s interest, has changed the locks on the leased properties and refused the Claimant access to its leased area. The Claimant seeks an order for the specific performance of the lease agreements and an enquiry into damages against the Defendant in order to establish the loss (including future losses) that have been or will be sustained by the Claimant through to the expiry of the lease period.

3.The Claimant’s Application for Non-Party Document Production Orders relates to documents in the possession or control of Union Properties PJSC, the DIFC Registrar of Companies and the DIFC Registrar of Real Property. The Claimant asserts that the documents of which production are sought are likely to support the case of the Claimant or adversely affect the case of the Defendant and production is necessary to obtain evidence which will establish the facts of the case, dispose fairly of the claim or to save costs.

4. I am of the view that the timing of the Claimant’s Application is premature and it would not be appropriate for the Court to order the production of documents from non-parties at this early stage when standard production of documents between the parties themselves has yet to take place. The Claimant submits that production of the documents sought from the non-parties is necessary to obtain evidence which will establish the facts of the case, however, it may be that some (if not all) of these relevant documents are uncovered through disclosure by the Defendant itself. In the event that further documents in the possession of non-parties are still required following initial disclosure between the parties, it would then be appropriate for the Claimant to make the application for production of documents from non-parties. I am satisfied that this is in line with the overriding objective.

5. Furthermore, the description of documents in the Non-Parties Schedule is ambiguous at best, as ‘any relevant emails’ and ‘entire files’ are being sought by the Claimant. RDC 28.17 requires a Request to Produce to contain a description in sufficient detail (including subject matter) of a narrow and specific category of documents that are reasonably believed to exist. I am not satisfied that the Schedule describes categories of documents in a sufficiently narrow way and the production of such broad categories of documents will undoubtedly lead to unnecessary additional costs being incurred which goes against one of the reasons listed under RDC 28.52(2) for ordering the production of documents by non-parties; namely, to save costs.

6. With respect to the Defendant’s Application for security for costs to be paid by the Claimant into Court, the Defendant submits that pursuant to RDC 25.102(2), as the Claimant is a company and there is reason to believe that it will be unable to pay the Defendant’s costs if ordered to do so, it is just for the Court to make such an order.

7. The Court is empowered under RDC 25.100 to make an order for security of costs where it is just to do so and one of the conditions set out in RDC 25.102 applies. I am satisfied that the condition under RDC 25.102(2) applies in the circumstances as the Claimant is a company and its representative conceded during the Case Management Conference that it is no longer trading and would be unable to pay the Defendant’s costs. The Claimant submitted that there was a likelihood that the Claim would be successful and that it would not be liable to pay the Defendant’s costs, however, as with all litigation, it cannot be said with certainty that any party will not become liable to pay the costs of the other.

8. Accordingly, I find that security for costs should be paid into Court, however, not in the full amount being sought. Rather, I deem 50% of the Defendant’s estimated costs to be an appropriate amount in the circumstances. Therefore, the Claimant must pay USD 86,864.50 into Court as security for the Defendant’s costs within 30 days of this Order.

9. The Case Management Timetable shall be issued by Court Order, if not agreed by the parties, within 7 days of receipt of the Claimant’s payment into Court of security for costs. Pursuant to RDC 25.112, in the event of default of payment the Defendant is granted permission to apply to the Court for the case to be stayed.

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