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Igashao v Igraine Accounting and Bookkeeping LLC [2017] DIFC SCT 346

Igashao v Igraine Accounting and Bookkeeping LLC [2017] DIFC SCT 346

March 20, 2018

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Claim No. SCT 346/2017 

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

 

In the name of His Highness Sheikh Mohammed Bin Rashid Al Maktoum,

Ruler of Dubai

IN THE SMALL CLAIMS TRIBUNAL OF DIFC COURTS

BEFORE SCT JUDGE NASSIR AL NASSER

 

BETWEEN

IGASHO

Claimant

and

 

IGRAINE ACCOUNTING AND BOOKKEEPING LLC

Defendant

Hearing:13 March 2018

Judgment: 20 March 2018


JUDGMENT OF SCT JUDGE NASSIR AL NASSER


UPON hearing the Claimant and the Defendant

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

IT IS HEREBY ORDERED THAT:

1.The Defendant shall pay the Claimant the sum of AED 9,143.75 in respect of the procedures project.

2. All other claims are dismissed.

3. Each party shall bear their own costs.

 

Issued by:

Nassir Al Nasser

SCT Judge

Date of issue: 20 March 2018

At: 12pm 

 

 

THE REASONS

The Parties

1.The Claimant is Igasho (herein “the Claimant”), an American national who entered into a working relationship with the Defendant.

2. The Defendant is Igraine (herein “the Defendant”), the owner of Igraine, Dubai.

 Background and the Preceding History

1. The underlying dispute arises over the payment of outstanding invoices in the sum of AED 29,122.93 for work performed by the Claimant on three separate projects for the Defendant company. The Claimant asserts that a signed legal agreement she entered into with the Defendant stipulated that the latter would manage all client billing and collections for and on behalf of the Claimant’s projects “that were in process up to and subsequent to 30 September 2017”.

2. The Claimant instead of amending the claim to amend the amount claimed, filed a new claim which is SCT 360/2017.

3. The Courts in an order dated 8 January 2018 ordered to consolidate the case numbers SCT 346/2017 and SCT 360/2017. The cases are consolidated under SCT 346/2017.

4. The Defendant contested the jurisdiction of the Courts on 24 January 2018, and the Courts denied the jurisdiction application and established that the DIFC Courts shall hear and determine the case.

5. The Defendant also filed Claim SCT 084/2018 to stay proceedings until further notice as there is an ongoing investigation against the Claimant in Dubai Police and Dubai Economic Department.

6. The Courts in an order dated 28 February 2018 ordered to consolidate the case number SCT 084/2018 and it shall be treated as a counterclaim. The cases are now consolidated under SCT 346/2017.

7. The parties met for a Consultation with SCT Judge Natasha Bakirci on 30 January 2018 but were unable to reach a settlement.

8. Both parties attended the hearing before me listed on 13 March 2018.

The Claim

9. The Claimant was previously employed by the Defendant from 26 November 2015 until her resignation on 31 August 2017 and the last day of work was on 30 September 2017.

10. The Claimant alleges that there is a signed legal agreement between the Claimant and Defendant. The agreement stipulates that the Claimant transitioned from her role of employee to that of outsourced service provider effective 1 October 2017. The Defendant would seamlessly manage all client billing and collections for and on behalf of any of the Claimant projects that were in process up to and subsequent to 30 September 2017. The purpose of the agreement was for the Defendant to ensure that the Claimant receives monies owed to her by the Defendant for the work that she concluded on behalf of specific clients.

11. As per the agreement, the Claimant has rendered services to 3 clients, and the Defendant has not paid the fees owed and confirmed to them by the Claimant. The services were to three specific clients who are i) Ikale LTD. (herein “Ikale”) ii) Itai Computer Systems LLC and iii) Izaac.

12. The Claimant alleges that the service she provided to Ikale was the preparation of the September monthly financial reports, in which the Claimant’s fees were AED 6,800. In addition, the completion of the accounting procedures project in which the Claimant’s fees were AED 9,143.75.

13. Furthermore, the Claimant alleges that the Defendant is deliberately not asking Ikale to settle the dues to the Defendant in order to pay the Claimant. As such, the Claimant alleges that she had completed the work and that she even spent extra time and effort in order to assist Ikale in a transition of their accounts over to their internal finance team.

14. In addition, the Claimant alleges that Ikale did not even dispute the invoices and in fact on numerous occasions promised payment. The Claimant alleges that the Defendant has not attempted to collect any of the outstanding amounts from Ikale as per usual practice. Therefore, the Claimant adds that the Defendant owed the Claimant the total of AED 15,943.75.

15. The Claimant also filed a Small Claim SCT 360/2018 seeking the payment of an invoice in relation to the second client Itai Computer services LLC. However, at the hearing the parties settled the matter and a consent order was issued. In regard to the third client, Izaac Events LLC, the parties also settled prior to the hearing.

16. Therefore, the Claimant only seeks the payment of invoices in relation to the work done for the Client, Ikale LTD.

The Defence

17. The Defendant confirms that on 5 October 2017, the parties entered into an “Agreement to pay client fees”.

18. The Defendant alleges that the Claimant requested that the Defendant enter into the Agreement. In addition, the Defendant alleges that the Claimant represented to the Defendant that she had completed the work, in accordance with the terms of the letter of engagement for the three clients as mentioned above.

19. The Defendant asserts that Clause 1 of the Agreement provides that the Defendant will pay the claimant 85% of all outstanding client’s fees for Ikale, Itai and Izaac. Clause 1 also states that the payments must be made within 4 working days of receipt of such payments by the Defendant.

20. Clause 2 of the Agreement states “in the event that either clients fail to pay their outstanding invoices after service have been fully rendered in compliance with their letters of engagement, the Claimant reserves the right to file a claim in the DIFC Courts on behalf of the Defendant as per usual practice.”

21. The Defendant asserts that Clause 1 and 2 of the Agreement make it clear that the Claimant’s entitlement to be paid commission is conditional on:

(a) The Claimant having completed and fully rendered the services to the client; and

(b) The Defendant receiving the fees from the client.

22. The Defendant then asserts that the work for Ikale was not completed by the Claimant at the time the parties entered into the Agreement, contrary to the Claimant’s representation, and therefore, the Defendant alleges that the Claimant is not entitled to be paid the sums claimed for commission.

Discussion

23. During the consultation and the hearing, the parties settled part of the claims, namely, claims related to two clients (Itai and Izaac) therefore I will not address any matter related to those two clients in this claim.

24. The Defendant also filed SCT 084/2018 to stay proceedings pending the outcome of investigations by Dubai Police and Dubai Economic Department. However, the Defendant failed to provide any proof of investigation. In addition, the claims filed there are irrelevant to this claim. Therefore, I have dismissed the claim SCT 084/2018 at the hearing held before me for lack of evidence and irrelevancy to this claim SCT 346/2017.

25. I will only concentrate on the remaining claim which are invoices related to Ikale in the sum of AED 15,943.75. To establish whether the Claimant is entitled to the sum or not we have to confirm whether the work carried out by the Claimant is completed, here only we will be able to decide the claim.

26. The Claimant argued at the hearing that the preparation of the September monthly financials reports was completed and therefore she is entitled to the sum of AED 6,800. However, the Defendant argues that the September financial reports were not totally completed.

27. The Defendant in her argument referred to a chain of emails between herself, the Claimant and Ikale.

(a) On 10 September 2017, the Director of Ikale emailed the Claimant and the Defendant and advised that Ikale decided to bring the bookkeeping inhouse and provided notice that he was terminating Ikale’s engagement with the Defendant. The Director of Ikale also stated that he expected the Defendant to finalise Ikale’s September accounts.

(b) On 17 September 2017, the Director of Ikale emailed the Claimant and the Defendant again asking how the September accounts would be finalised with the Claimant’s departure. The Claimant responded on the same day confirming that she would finalise the September accounts.

(c) On 8 and 10 October 2017, Ikale exchanged emails with the Claimant responding to the Claimant’s request for information to finalise the September accounts. The Claimant did not even acknowledge these emails, nor confirmed that she had handled these queries based on their response.

(d) On 15 October 2017, the Director of Ikale emailed the Defendant and the Claimant expressing his disappointment that the September accounts had not been completed and that a number of issues had not been resolved regarding the procedures manual which the Claimant had been working on for Ikale since December 2016.

(e) On 16 October 2017, the Director of Ikale stated in an email that “I spoke with the finance team this morning regarding the September accounts and as suspected these have not been completed. We are not in a position to wait for “the Claimant” so I have asked the team to complete them themselves”.

28. From the chain of emails, I have reached the conclusion that the September accounts were not fully completed and Ikale had their own inhouse team complete the job. In addition, emails were sent to the Claimant in regard to the clarifications of the salaries for the September accounts, but at the hearing she confirmed that she did not see these emails, and again on email the Claimant confirmed that she did not see the clarification email. Therefore, the Claimant is not entitled to receive monies related to the September invoices in the sum of AED 6,800.

29. In regard to the accounting procedures project in which the Claimant’s fees were AED 9,143.75. the Claimant argues that the job was done as per the scope of work. However, the Defendant argues that it was not fully completed, and that the Claimant is not entitled to receive monies for work that is not fully completed.

30. At the hearing, I have asked the Claimant to show me the accounting procedures project and compare it with the Scope of Work. I found that the work done by the Claimant is identical to the scope of work. Therefore, I do not agree with the Defendant that the procedures were not completed. I find the Claimant is entitled to the sum of AED 9,143.75.

31. The Defendant voided the invoices for Ikale without discussing it with the Claimant. Therefore, the Defendant shall be responsible to compensate the Claimant’s 85% of the invoice as per the Agreement.

Conclusion

32. In light of the aforementioned, the Defendant is liable to pay the Claimant in respect of the accounting procedures project in the sum of AED 9,143.75.

33. All other claims are hereby dismissed.

34. Each party shall bear their own costs.

Issued by:

Nassir Al Nasser

SCT Judge

Date of Issue: 20 March 2018

At: 12pm

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