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Ali Mohammed Salem Abu Adas (2) Mohammed Jawdat Ayesh Mustafa Al Bargouthi v Bankmed (SAL) trading in the DIFC under the Trade Name Bankmed (Dubai) DIFC [2019] CA 001

Ali Mohammed Salem Abu Adas (2) Mohammed Jawdat Ayesh Mustafa Al Bargouthi v Bankmed (SAL) trading in the DIFC under the Trade Name Bankmed (Dubai) DIFC [2019] CA 001

June 13, 2019

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Claim No. CA-001-2019

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 APPEAL

BEFORE CHIEF JUSTICE ZAKI AZMI, JUSTICE SIR JEREMY COOKE AND H.E. JUSTICE ALI AL MADHANI

BETWEEN

(1) ALI MOHAMMED SALEM ABU ADAS (2) MOHAMMED JAWDAT AYESH MUSTAFA AL BARGOUTHI

Second and Third Defendants (respectively) /Appellants

and

BANKMED (SAL) TRADING IN THE DIFC UNDER THE TRADE NAME BANKMED (DUBAI)

Claimant/Respondent

Hearing: 21 May 2019
Counsel: Ms Louise Wright instructed by Global Advocacy and Legal Consultants for the First Appellant Ms Dilpreet Dhanoa assisted by Alain Farhad instructed by Squire Patton Boggs for the Second Appellant Mr Mazen Boustany assisted by Andrew Mossey instructed by Baker Mckenzie Habib Al Mulla for the Respondent
Judgment: 9 June 2019

JUDGMENT


ORDER

UPON reviewing the First Appellant’s (the Second Defendant in CFI-033-2017) application for permission to appeal dated 25 November 2018 and the Second Appellant’s (the Third Defendant in CFI-033-2017) application for permission to appeal dated 12 December 2018

AND UPON reviewing the Respondent’s submissions, in response to the First Appellant and Second Appellant’s permission to appeal, dated 9 January 2019

AND UPON hearing Counsel for the Appellants and Counsel for the Respondent on 21 May 2019

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

IT IS HEREBY ORDERED THAT:

1. The Appeal is dismissed.

2. Costs to the Respondents and shall be assessed by the Registrar unless agreed.

Issued by:
Amna Al Owais
Registrar
Date of issue: 11 June 2019
Time: 12pm

JUDGMENT

JUSTICE SIR JEREMY COOKE

Introduction

1. The Second and Third Defendants appeal with the permission of the Judge who, at different times, set aside judgments entered in default against each of them on their failure to file a defence in the time prescribed by Part 16 of the Rules of the DIFC Courts (the “RDC”). It will at once be appreciated that the two defendants were the “winners” on their applications to set aside the judgments entered against them but now seek to appeal, not against the decisions themselves but against some of the reasons given by the Judge when setting aside the judgment entered against the Second Defendant in an order dated 12 November 2018.

2. These were not reasons given when setting aside the judgment entered against the Third Defendant on 22 April 2018 and there is no complaint about the reasons given on that occasion, nor, of course, with the decision made. The Third Defendant was not present at the hearing of the Second Defendant’s application on 31 October 2018. By reason of the decision made by the Judge on each application, each of the two Defendants is now in a position fully to defend the claim made against them under guarantees given by them in respect of the indebtedness of the First Defendant to its lending bank, the Claimant. Nothing that this Court is being asked to do affects the orders made which set aside the judgments entered in default against those two Defendants.

3. These appeals are as bizarre as they sound, but it appeared from the skeleton arguments and in oral argument that what was said to concern the two defendants was the obiter dicta of the judge relating to the arbitrability of the disputes in the reasons he gave when setting aside the judgment against the Second Defendant and the prejudice to them which was said to flow from that, because he considered that this court had jurisdiction.

4. The Third Defendant, following the setting aside of the judgment against him applied on 24 May 2018 for the claim against him to be stayed on the basis of an arbitration clause which is to be found, not in the Guarantee signed by him, but in the Facility Agreement under which the Claimant lent money to the First Defendant, which was guaranteed by the various defendants who at the time were shareholders and/or directors of the First Defendant. The Second Defendant apparently wishes to make a similar application but has not so far done so. It is noteworthy that neither Defendant has, as yet, put forward any defence to the claims made against them on the Guarantees although at the hearing of these appeals, the Third Defendant’s counsel stated that a defence might be put forward of forgery of his signature on the guarantee. That was a point which had been raised in early correspondence with the Claimant but had not formed part of any application to set aside the judgment and appeared to have been abandoned when it was pointed out that the Third Defendant was referring to documents relating to the First Defendant’s indebtedness to another bank.

5. The Claimant says that the history of the matter shows these two Defendants seeking to delay matters where there is no defence and that this appeal is part and parcel of that strategy. The appeals have had the effect of a temporary stay on the proceedings, so that no defences have been served and the Third Defendant’s application for a stay in favour of arbitration has not yet been heard.

The Court’s jurisdiction to entertain the appeals

6. The RDC at Part 44.117 provides that the Court of Appeal will allow an appeal from “a decision” of the lower court where the decision was wrong or unjust because of a serious procedural or other irregularity in its proceedings.

7. An appeal has therefore to be brought against a decision, as set out in an order, not against the reasons for that decision. It is trite law in common law jurisdictions that parties can appeal against orders but not against the reasons given in judgments for those orders, with limited exceptions. The Second and Third Defendants do not complain about either of the decisions or orders setting aside the default judgment, but about various aspect of the reasons given on 12 November 2018, arguing that the judgment against the Second Defendant should have been set aside on a different basis to that adopted by the Judge, although the result would be an order to the same effect. They also object, as already mentioned, to the various obiter remarks he made about the inapplicability of the arbitration agreement which, they say, could prejudice both defendants in their pursuit of their applications for a stay.

8. There is authority that permits appeals to be brought in respect of a finding of a Court which constitutes or could constitute an issue estoppel; or where the finding could well have been part of the order but was not; or where there was a finding on a fundamental legal issue. The authorities in question are the DIFC Court of Appeal decision in DNB Bank v Gulf Eyadah Corporation [2015] CA 007 at paragraphs 60-63 (“DNB Bank”) and the English decisions referred to in it, namely Cie Noga D’Importation et D’ExportationSA v Australia & New Zealand Banking Group Ltd (No 3)[2002] EWCA Civ 1142, [2003] 1 WLR 307 at paragraph 28 and Morina v Secretary of State for Work and Pensions [2007] EWCA (Civ) 749 [2007] 1WLR 3033. The two Defendants were asked if they could bring themselves within these authorities in order to justify their appeals and did not attempt to do so.

9. In my judgment, no considerations of the kind raised in those authorities arise here and the additional authorities which were cited to us do not gainsay the principles to which I have just referred. It is expressly averred here by both Defendants that the dicta in question to which they object, which relate to the issue of the arbitrability of the disputes between the Claimants and the two Defendants, were obiter. The complaint is made that the Judge’s remarks in that respect were unnecessary, prejudicial and ultra vires, though what is meant by the latter term is unknown since there is no relevant limit on a judge’s powers to make passing comments in the shape of obiter dicta. There is, because the remarks were obiter dicta, no possibility of the dicta in question constituting an issue estoppel; nor was there any possibility that they could, by any stretch of the imagination, have found their way into an order which could be the subject of an appeal; nor do they constitute a fundamental legal issue of the kind recognised in the DNB Bank decision which was concerned with the issue of enforceability of foreign judgments recognised by the DIFC Courts in the Dubai Courts.

10. I am unable to see therefore that the Court has jurisdiction to hear this appeal from the Second Defendant, let alone the Third Defendant, or that it should exercise any jurisdiction that it might have to entertain these appeals. Whatever the Court’s inherent jurisdiction (and it will be recalled that the Court is a creature of statute with powers granted by statute only), there is no basis for the Court to hear an appeal in order to change the reasons given by the Judge, when his decision to set aside the judgment is itself not the subject of appeal and there is nothing in his challenged findings which could constitute an issue estoppel, could form part of an order or could be said to raise a fundamental issue of law.

11. Whatever the Judge said about the applicability or inapplicability of an arbitration agreement and whether he was right or wrong in what he said about the point not being pursued by the Second Defendant or other Defendants is therefore nothing to the point, in the context of an appeal. Any Judge who comes to consider the matter of the arbitrability of the dispute will not be bound by his comments and the arguments can be made afresh to him for his consideration without being in any way trammelled by what the Judge said in his reasons. The same applies even if the matter were to come before the same Judge who would now, in any event, have the benefit of what this Court says about its obiter nature.

The Practical Utility of the Appeals

12. As the Judge set aside the default judgments and no question of issue estoppel can arise, the question arises as to the utility of the appeal process in relation to the reasons put forward by the Judge, including the unnecessary reasons relating to arbitrability and the alternative reasons which the Second Defendant says he should have adopted instead. The essence of the latter point is put by the Second Defendant on the footing that the Judge ought to have set aside the judgment against him under RDC 14.1 and not under RDC 14.2, the difference being that under the first part of the Rule, where there is a breach of procedure in obtaining the default judgment, the judgment must be set aside, whereas if the application is to set aside the judgment under the second part of the Rule, the Court, where it finds that there is a defence with a realistic prospect of success or there is some good reason for the judgment to be set aside, is not bound to set it aside, but has a limited discretion whether or not to do so. As neither of the two Defendants did put forward a defence at all, the Judge, who found that there was no procedural irregularity in the entry of judgment against the Second Defendant (which alone is the subject of appeal), set it aside because he considered, at paragraph 5 of his reasons, that there was “a good reason why the Defendant should be allowed to defend the claim, as to do so would be in the interests of justice and in keeping with overriding objective of this Court.” He did not descend into any more detail on this point than appears in the citation which I have just set out.

13. Apart from the obiter dicta on arbitrability which are not binding and are therefore not prejudicial to the two Defendants, there is only one possible practical difference which could arise from this Court interfering with the findings made by the Judge. He found that there was service on the Second Defendant in the manner which had been agreed contractually or at least at his last known address. The Second Defendant wishes to challenge that finding. The Judge also found that, when a firm of solicitors filed an Acknowledgement of Service on behalf of all the Defendants, it had authority to do so on behalf of the Second Defendant, despite his evidence that he did not so instruct them and had no dealings with them. There was some evidence that the solicitors had received instructions from the First Defendant to file an acknowledgment of service on behalf of all Defendants. The Second Defendant was the leading light of the First Defendant. The Second Defendant wishes to challenge that finding, which is said to be prejudicial to him.

14. A finding that there was no authorised acknowledgment of service as opposed to an authorised acknowledgment of service has potential significance in two respects:

(a) It might impact on the time limit for service of a defence if the Claim Form was served with Particulars of Claim, which was not the case here (see below).

(b) It might impact on the time limit for making an application under Part 12 seeking an order that the Court refrain from exercising jurisdiction on the basis of an arbitration agreement. The time limit under RDC 12.4 for such an application, supported by evidence, is 14 days after filing an Acknowledgment of Service. The Second Defendant did not make any application supported by evidence within that time limit.

15. In the ordinary way, however, if judgment is set aside, the Court will give directions for the future conduct of the litigation, in the light of the fact that judgment has been set aside for good reason. The directions for the future will be shaped by the failure found by the Judge, whether to file an Acknowledgment of Service or Defence, as the case may be, by making provision for either step to be taken within a given time limit, in the light of the parties’ submissions as to the time needed in practice for that to happen. Here the Judge ordered, when setting aside judgment, that the Second Defendant be allowed a further 14 days following the Order to file a Statement of Defence, which is the same length of time as that permitted by the Rules for filing a defence following an Acknowledgement of Service and is the same time limit allowed, following such an Acknowledgement, for filing an Application to the Court not to exercise jurisdiction under Part 12. It does not appear that the Second Defendant sought any time extension for filing such a Part 12 application but if he had, it is almost inevitable that he would have received it along with the time allowed to serve a Defence. The absence of any such order is therefore due to the failure to seek such an extension of time for filing the stay Application. Moreover, no application has been made since for an extension which would be the appropriate course to take, once it was recognised, as it was in the Second Defendant’s skeleton, that the time had technically expired 14 days after the Acknowledgement of Service which the Judge found to be authorised.

16. The failure to make any such application on receipt of the Order of the Judge, or since that time, cannot justify an appeal being heard against the Judge’s reasons for his decision, even if a change in those reasons could invalidate the Acknowledgment of Service and cause the Court to give a fresh time limit for filing it and thereby extend the time for filing a Part 12 Application. There was no need for an appeal when an application could have been made (and still could be made) for such an extension.

17. Furthermore, for reasons which appear below, it appears to me that any application for a stay on the ground of an applicable arbitration agreement is likely to be doomed in any event, so that the Second Defendant cannot properly say that he has been prejudiced in any way by the failure to seek an extension or to have the reasoning of the Judge examined in this Court.

Conclusion as to Admissibility of the Appeals

18. The Second Defendant, and a fortiori, the Third Defendant, have therefore no basis upon which to come to this Court to appeal against the reasons given by the Judge when deciding in the Second Defendant’s favour on setting aside judgment entered in default against the Second Defendant. The appeal of the Second and Third Defendants must be dismissed on that basis alone, with costs of the appeal and the applications for permission to appeal.

19. Nonetheless, for completeness, I turn to the grounds of appeal and the contentions made in relation to the Judge’s findings of proper service, of authorised Acknowledgment of Service, of the inapplicability of the Arbitration Agreement in the Facility Agreement and the issue of prematurity of the Application for default judgment, the last of which the Judge did not determine.

Service of the Claim Form

20. The Judge found that the Claimant had served the Claim Form on the Second Defendant by sending it by courier to the address provided by the Second Defendant which appeared in clause 31 of the Facility Agreement. That clause provided in subclause 2 that any communication or documents to be made or delivered under or in connection with the Finance Documents should be addressed to the postal addresses and email addresses set out in the clause, subject to any change being notified by the putative recipient party. The Definition of Finance Documents included the Guarantees of the Second and Third Defendants as Security Document and both the Second and Third Defendants signed the Facility Agreement. The Guarantee signed by the Second Defendant contained the same address “for the purpose of this First Demand Limited Personal Guarantee”. No change of address was notified to the Claimant, so the Judge found that there was valid service, which can only have meant in accordance with RDC 9.2(2) and/or 9.17 (1) and/or 9.19 and/or 9.44, each of which is capable of applying in the circumstances. On the materials produced by the courier service, and presented to the Court, the Judge was entitled to come to the conclusion that service had been effected at the Second Defendant’s last known place of residence and/or contractually designated place for service, whether or not the matter had actually come to the attention of the Second Defendant.

Authorised Acknowledgment of Service

21. The Judge did not accept that the solicitors did not have instructions from the Second Defendant to represent him and file an Acknowledgment of Service for him. That is not a finding to which I would have come since the only evidence before him was that of the Second Defendant who said he had never instructed those solicitors and there was nothing to contradict that evidence. Indeed, it appeared from correspondence that the solicitors had accepted instructions from the First Defendant to enter an acknowledgment of service on behalf of all the guarantors as well as the First Defendant itself. Given the close connection between the First Defendant and the Second Defendant, the Judge may have been sceptical about the latter’s evidence but I consider that the evidence before him compelled the conclusion that the Acknowledgment of Service had been filed without the Second Defendant’s personal authority and was therefore invalid. In those circumstances there would have been a failure, following valid service of the Claim Form to file an Acknowledgment of Service in the time allowed and the application for default judgment would have been pursued on a different basis and at an earlier time, under RDC 11.4 and 13.4 with the same result of judgment by default.

Prematurity of the Application for Default Judgment

22. It was argued, though the Judge did not determine the point that the application for default judgment was premature because the time for service of a defence did not elapse until 28 days after service of the Particulars of Clam on 3 October 2017. The application for default judgment was made on 22 October 2017, some 19 days after such service.

23. Despite the Claimant’s apparent acceptance of the proposition that 28 days was the relevant time limit for the defence to be served, on a proper construction of the RDC, it is in fact only 14 days which must elapse following service of the Particulars of Claim where they are served separately from the Claim Form. The 28 days period applies only where the Particulars of Claim are served with the Claim Form.

24. The Rules draw a distinction between the position where the Claim Form is accompanied by Particulars of Claim and the situation where it is not.

(a) RDC 10.1 sets out the position where the Claim Form is not so accompanied and gives a defendant the option to admit all or part of the claim or file an Acknowledgment of Service in accordance with Part 11. See in particular RDC 10.1(3).

(b) RDC 10.2 sets out the position where Particulars of Claim are served and gives a defendant the option to make admissions (RDC10.2(1)) and/or file a defence (RDC10.2(2)), but RDC 10.2(3) specifically provides that where Particulars of Claim are served with the Claim Form, the defendant may file an acknowledgment of service in accordance with Part 11. It is plain that RDC 10.2 thus draws that distinction between the two situations where the Claim Form is accompanied by Particulars of Claim and where it is not.

(c) RDC 11. 2(1) provides that a defendant should file an Acknowledgment of Service where the Claimant serves a Claim Form without serving Particulars of Claim, whilst RDC 11.2 (2) provides for an acknowledgment of service to be filed if the defendant is unable to file a defence within the period specified in RDC 19.9 (which of necessity can only apply where Particulars of Claim have been served). [RDC 11.2(3) requires an acknowledgment of Service where the defendant wishes to dispute the Court’s jurisdiction].

(d) RDC 11.5 provides that the general rule is that the period for filing an Acknowledgment of Service is 14 days after service of the Claim Form.

25. When reference is then made to RDC 16.9, it is clear that provision is there being made for this distinction between the situation where Particulars of Claim accompany the Claim Form and where they do not, notwithstanding that it sets out “the general rule “ for “ the period for filing a defence”.

The Rule provides:

“The general rule is that the period for filing a defence is:

(1) 14 days after service of the Particulars of Claim.

(2) If the Defendant files an acknowledgment of service under Part 11, 28 days after service of the Particulars of Claim.”

25. Whilst the Rule is not a model of clarity and should, in my view, be revised to make the position clear, on a proper construction of RDC 16.9, the first sub-rule, with its 14 day limit applies to the position where separate Particulars of Claim are served, subsequent to the Claim Form, whilst the second sub-rule with its 28 day period following service of the particulars of claim for filing a defence, applies where the Claim Form is accompanied by the Particulars of Claim.

26. Thus the 28 days provision under sub-rule (2) only applies where the Claim Form includes Particulars of Claim and the Defendant has filed an Acknowledgment of Service, as provided for in RDC 10.2(3) and RDC 11.2(2). Where the Particulars of Claim are served subsequently, it is the 14 days provision in sub-rule (1) which applies, with an Acknowledgment of Service filed under RDC 10.1(3) and RDC 11.2(1) and 11.5. The effect is to give the defendant a minimum period of 28 days from service of the Claim Form in either situation:

(a) Where there are accompanying Particulars of Claim, the Rules provide for 14 days following service for an Acknowledgment of Service and a further 14 days for a defence (a total of 28 days from service of the Claim Form and accompanying Particulars).

(b) Where there are no accompanying Particulars of Claim, the Rules provide for 14 days following service of the unaccompanied Claim Form for an Acknowledgment of Service and then a further 14 days for a defence following service of the separate Particulars of Claim which would usually follow the Acknowledgment of Service.

27. Any other construction of RDC 16.9 would be irrational. Unless RDC 16.9 is read in this way, it is nonsensical as it would otherwise appear to provide for a longer period for service of a defence where an acknowledgment of service is filed than where it is not, even though the Rules do not envisage any circumstances where a defence is to be filed without an acknowledgment of service.

28. In the circumstances which arose in the present case, where the Claim Form served on the Second Defendant on 27 August 2017 did not include Particulars of Claim, the Second Defendant could have filed an Acknowledgement of Service under RDC 10.1(3) within 14 days. The Judge found that he did on 5 September 2017, when the solicitors instructed by the First Defendant did so, ostensibly on his behalf. In such circumstances, he then had 14 days after separate service of the Particulars of Claim on 3 October 2017 to serve his defence under RDC 16.9(1) expiring on 17 October 2017.

29. The application to enter judgment in default of defence was thus made 5 days after expiry of the time for service of the defence, on the judge’s findings of fact. There was thus no irregularity in the making of the application.

30. If there had been no such authorised Acknowledgment of Service, then a Judgment could have been entered in default of appearance following proper service of the Claim Form with no practical difference in outcome, as an application could then have been made to set it aside on the basis that the Second Defendant had no actual knowledge of such service. As judgment has been set aside, there is no relevance in the point at all.

The Applicability of the Arbitration Agreement

31. The two Defendants complain that the Judge at paragraphs 1 and 2 of his reasons, expressed an obiter view on the construction of Clause 39 of the Facility Agreement which contained:

(a) at Clause 39.1, an agreement to the jurisdiction of the DIFC Courts in respect of “any dispute arising from or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement or any-non-contractual obligations arising out of or in connection with this agreement”; and

(b) at Clause 39.2 an agreement to arbitrate “any dispute arising out of or in connection with this contract”.

32. Clause 39.1(c) provided that “this Clause 39.1 is for the benefit of the Lender only” and was not to prevent the Lender from taking proceedings in other courts with jurisdiction. The Judge considered that this meant that the DIFC Courts had jurisdiction over the claims against the Second Defendant and that the Claimant was free to choose the jurisdiction where he wanted to bring the claim. He also went on in paragraph 2 of his reasons to make the irrelevant comment that none of the other Defendants had contested jurisdiction, which was wrong since the Third Defendant had applied for a stay on 24 April 2018 in reliance on the arbitration provision in Clause 39.

33. The Judge did not refer to the opening words of Clause 39.1 which state that “Subject to Clause 39.2 (Arbitration)” [the Courts of the DIFC should have non- exclusive jurisdiction]. Those opening words, to my mind, could make all the difference if a Court was determining its jurisdiction against the guarantors on the basis of the Facility Agreement but the parties appear to have directed their attention to that Agreement and not to the terms of the Guarantee which the Second Defendant had signed (and which was in identical form for the Third Defendant). Whilst the Second Defendant was party to the Facility Agreement and was sued as guarantor under that Agreement, he was also party to a separate operative contract of guarantee (as were the other individual defendants) as found in a First Demand Limited Personal Guarantee signed by him.

34. This Guarantee given by the Second Defendant at Clauses 2,3,4,7 and 10 gave rise to a primary liability on the Second Defendant regardless of any defences available to the First Defendant and was truly an “on demand” guarantee, with waiver of any right to refuse payment on demand being made. More importantly for current purposes, it included at Clause 14 a provision that the law of the DIFC was the governing law and an agreement by the Second Defendant to the jurisdiction of the DIFC Courts “for any legal action or proceedings with respect to the Guarantee”. Whatever the proper construction of Clause 39 of the Facility Agreement, therefore, the Second Defendant had, on the face of the Guarantee agreed to the jurisdiction of this Court for suit thereunder. The Judge was not therefore directing his mind to a primary document relevant to the dispute when passing his obiter comments at paragraph 1 of the Reasons by reference to Clause 39 of the Facility Agreement.

35. Whilst the Third Defendant, whose presence before the Court was – in itself surprising – pointed out, with some force, that it was not for this Court to determine the stay application, the two Defendants cannot have it both ways. They both desired this Court to say that the Judge should not have said what he did about arbitrability of the dispute for two reasons. First because it was unnecessary for him to do so but, secondly, above all, because he was wrong in his conclusions and it could have prejudicial effect on a decision to be made in the future on the stay applications. Whilst what we say is not necessary for our decision because we have already found that an appeal does not lie in respect of such obiter remarks of the judge, we add that there is no basis for preventing a judge from making obiter remarks and that if he was wrong in the conclusions he reached, a key document relevant to the jurisdictional dispute was not referred to – namely the First Demand Limited Personal Guarantee signed by the Second Defendant and all the other individual defendants in which each agreed to the jurisdiction of this Court.

Conclusion

36. There is therefore, in reality, no ground for complaint against the reasons given by the Judge, even if it was open to the Second Defendant and/or Third Defendant to appeal against them. There is no practical impact from the conclusions he reached.

37. It appears to me that there has been enough delay in this action already and that it should now continue following dismissal of the appeals, at a much faster rate than heretofore.

CHIEF JUSTICE ZAKI AZMI:

1. As was said by my learned brother, Justice Sir Jeremy Cooke, in his Judgment, which I have had the advantage of reading, it is rather unusual that the parties seek to challenge the obiter dicta given by the judge in the Court of the First Instance while agreeing to and not contesting the decision itself. The Second and Third Defendants (the two appeals heard together) had their application for Judgments in default entered against them, set aside. They are not contesting the decision to set aside the Default Judgments but however are seeking to appeal against the obiter statements of the learned Judge made in his Schedule of Reasons. This is obviously not legally permissible.

2. Under RDC 44.117 the Court of Appeal will allow an appeal from the Court of the First Instance where the decision of the Court of First Instance was wrong or unjust. That rule refers to the decision and not the reasoning in arriving at the decision. The Appellant sought to strike out and/or amend some parts of the judgment allegedly on the ground that these statements are not relevant to the decision of the Judge and/or are prejudicial to other pending matters before the DIFC Courts and/or Arbitration related to the dispute between the Claimant and the Defendants. This Court of Appeal has no power to strike out or amend reasonings given by any Judge in arriving at his conclusion. The Court of Appeal can only, at most, make comments agreeing or disagreeing to the reasonings of the Judge. To this general principle are some exceptions. As pointed out by my learned brother, Justice Sir Jeremy Cooke, this general rule is subjected to exceptions in very limited instances. The exceptions are well cited in the decision of this Court in DNB Bank v Gulf Eyadah Corporation [2015] CA 007. In that case, this Court in expressing its opinion had relied on English decisions mentioned in that Judgment. The DNB Bank decision was brought to the attention of the Appellants to find out if their case fall within any of these exceptions. Unfortunately, they were unable to do so.

3. Justice Sir Jeremy Cooke in his Judgment had discussed at length the various obiter statements made by the Judge of the Court of First Instance and express his own views on those obiters. I would like to associate myself with the views expressed by him. I do not think I could add any more value to his views expressed in his Judgment.

4. It is also a well recognised principle that obiter dicta in any judgment is not binding on any other courts. At most they are merely guidance or persuasive which any other court may wish to follow or not. It is unlike the ratio decidendi of the case which is binding based on the principle of stare decisis.

3. In these circumstances, I dismiss both appeals with costs. Costs to the Respondents and shall be assessed by the Registrar unless agreed.

H.E. JUSTICE ALI AL MADHANI

1. I agree with the abovementioned judgment and have nothing further to add.

Issued by:
Amna Al Owais
Registrar
Date of issue: 11 June 2019
Time: 12pm

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