Claim No. CFI-029-2018
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE COURT OF FIRST INSTANCE
THE INDUSTRIAL GROUP LTD
ABDELAZIM EL SHIKH EL FADIL HAMID
ORDER WITH REASONS OF SIR JUSTICE RICHARD
UPON reviewing Application No. CFI-029-2018/1 dated 12 August 2018 seeking to set aside the Default Judgment of Judicial Officer Nassir Al Nasser dated 30 July 2018 (the “Application”)
AND UPON reviewing Claimant’s evidence in answer to the Application dated 11 October 2018
AND UPON hearing Counsel for the Claimant and Counsel for the Defendant at a hearing on 15 October 2018
IT IS HEREBY ORDERED THAT:
1. The Application is dismissed with a stay of execution on judgment pending trial of the Defendant’s cross-claims.
2. The Defendant shall pay the Claimant’s costs of the Application on the standard basis, to be assessed by the Registrar if not agreed.
Ayesha Bin Kalban
Date of issue: 25 October 2018
SCHEDULE OF REASONS
1. This is an application by the Defendant, Mr Hamid, to set aside a judgment that was entered in default under Rule 13 of the Rules of the DIFC Courts (the “RDC”).
2. The learned Judicial Officer entered judgment for the sum of AED 1,376,000. That is the sum that is claimed in respect of monies paid to the Defendant when there was, in respect of those payments, insufficient and/or improper justification advanced in order to procure payment.
3. The application to set aside is made under RDC Rule 14.2 and for the purposes of today, under that Rule, the Defendant has to show that he has a real prospect of successfully defending the claim.
4. Under Rule 14.4 an application under 14.2 must be supported by evidence. An expert’s report has been tendered in evidence, which is relied on, but the Defendant had not put before the Court a signed witness statement attesting to his honest belief that he had a defence to the claim, nor was there a witness statement setting out the basis of such an honest belief. That was an unfortunate omission but it was cured by the Defendant going into the witness box and giving sworn evidence to the effect that he had an honest belief that he had a defence, and that the defence was based on the claims identified in his expert’s report.
5. The claims which are made in the expert’s report are properly characterised as a counter-claim. They do not, in my judgment, amount to a defence. For there to be a defence by way of a cross-claim, the cross-claim must amount to what the law calls a set-off and there can only be a set-off where there is a very close relationship between A’s claim against B and B’s claim against A. In my judgment, there is no such sufficient relationship between the claim made by the Claimant for payments, which have been received and improperly indented for and the claims which are identified in the expert’s report.
6. That means that there is no proper basis for setting aside this judgment which has been advanced to the Court. The Claimant, through Mr Russell, Queen’s Counsel, has approached this matter in a realistic and practical way. They have suggested to the court that the right order to make is to stay execution on the judgment and allow the cross-claim, and any remaining claims not wrapped up in the judgment obtained by the Claimant, to proceed, and then for the court to decide what the final orders should be, depending, in effect, on the success of the defendant’s cross-claim. That is the order that I am going to make here in this case.
7. Directions have already been made which consolidate the two claims and which provide a timetable for the service of pleadings and for a case management conference to be brought back on so that further directions can be made for the speedy disposition of these proceedings.
8. This application fails to the extent that the Court is not setting aside the judgment which was entered against the defendant, although the outcome for the Defendant does mean that he will not have to pay on the judgment pending the trial of the proceedings. But the application having failed, and indeed even if it had succeeded, the conventional order for costs in these cases is that the applicant must pay the costs of this hearing. I so order that the Applicant, the Defendant, Mr Hamid, must pay the costs on the standard basis if they are not agreed.
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