September 19, 2025 court of first instance - Orders
Claim No. CFI 025/2025
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE COURT OF FIRST INSTANCE
BETWEEN
JONATHAN DAVID SHEPPARD
Claimant
and
SADAPAY TECHNOLOGIES LTD
Defendant
ORDER OF H.E. JUSTICE ROGER STEWART
UPON the Defendant’s Application No. CFI-025-2025/2 dated 30 June 2025 seeking to contest the jurisdiction of the DIFC Courts (the “Application”)
AND UPON reviewing the Claimant’s evidence in answer to the Application dated 14 July 2025
AND UPON reviewing all documents filed in support of the Application and their respective responses
AND UPON hearing Counsel for the Claimant and Counsel for the Defendant at the hearing held before H.E. Justice Roger Stewart on 3 September 2025 (the “Hearing”)
IT IS HEREBY ORDERED THAT:
1. On the condition that the Claimant file and serve re-Amended Particulars of Claim identifying the legal basis of claim and removing the assertion that this is an employment claim by 4pm on15 October 2025, the Application is dismissed.
2. The Defendant shall file and serve an Amended Defence by no later than 4pm on Wednesday, 12 November 2025.
3. The costs of and occasioned by the re-amendment are to be paid by the Claimant in any event.
4. There shall be no order as to the costs of the Application.
Issued by:
Delvin Sumo
Assistant Registrar
Date of issue: 19 September 2025
At: 3pm
SCHEDULE OF REASONS
1. This is a claim brought by the Claimant, Mr Johnathan David Sheppard against the Defendant, Sadapay Technologies Ltd.
2. The essential facts are:
(a) The Claimant was employed by the Defendant as Chief Technology Officer pursuant to an employment agreement dated 30 June 2020;
(b) The Defendant gave notice of termination of employment on 31 July 2024 and put the Claimant on gardening leave from 1 August 2024 with his final employment day being 31 August 2024;
(c) The Claimant issued his claim form on 4 March 2025 seeking compensation in relation to the shares in the Defendant vested on him under the Defendant’s share incentive plan;
(d) It is apparent from the claim form together with particulars of claim and the Claimant’s skeleton argument that this was cast by the Claimant being an Employment claim and, moreover, a claim for remuneration to which the provisions of the DIFC Employment law number 2 of 2019 applied by reference to Article 22 of that law;
(e) It was said that this was a claim for unlawful deduction from the employee’s remuneration to which the provisions of Article 22(a) applied with the consequence that a court should not consider a claim unless presented to the court before the end of the period of six months, beginning with, in the case of a claim relating to deduction from or non-payment of remuneration by the employer, the date of payment of the remuneration from which the deduction was made or the date on which the remuneration should have been paid as appropriate;
(f) Two points were originally taken by the Claimant in relation to this matter:
i. The first was that the objection to jurisdiction which had not been filed within 14 days of the acknowledgment of service. In relation to this it is apparent tha the Claimant was not aware of the circumstances under which the Defendant had originally complained about the signature of the claim form and the order which the Court made in June of this year which gave a specific period for the application regarding jurisdiction to be made. The application was duly made within that period. Accordingly, the Claimant’s counsel realistically accepted that the point was not open to her;
ii. The second was that the Claimant was not aware of the breach until 9 September alternatively that there was a continuing breach. However, it is plain that on the pleaded and admitted facts, the relevant exercise took place on 19 August and accordingly that if this is a failure to pay remuneration within Article 22(a), the relevant date would be 19 August and the claim form was issued more than 6 months after that date;
(g) It follows that on the basis currently pleaded the claim is out of time;
(h) However, in the course of her oral argument, the Claimant’s counsel said that she wished to rely on an alternative argument which was that the claim was not properly to be regarded as a claim for remuneration but rather a claim in relation to the breach of the grant agreement which incorporates the share incentive plan;
(i) The grant agreement has an express DIFC jurisdiction clause and an English choice of law clause; and
(j) I asked the Defendant’s counsel if he was in a position to deal with this new case and he fairly concede he was largely because this matter has been listed with another case where the issue already arises.
3. I consider that it is appropriate to consider this argument on the basis that the Claimant serves appropriate amendments withdrawing the assertion that this is an employment claim and setting out her new case particularly as the relief sought would mean the end of this case and it already arises in another matter where the same counsel appears for the Claimant and the Defendant.
4. I proceed therefore on the basis that the claim will be made on the basis that there was a breach of the grant agreement and/or the incorporated share incentive plan in which case the question arises as to the proper application of the relevant laws in relation to such a claim.
5. The grant agreement was made on 10 March 2021 and was between the Claimant and the Defendant. In that agreement:
(a) By recital A, it was recorded that the Defendant had adopted a share incentive plan, the terms and conditions of which are set out in the plan adopted on the same date’
(b) The recitals then recorded that the Defendant had the ability to allocate restricted shares and that it was a requirement of the plan terms that a grant agreement be entered into;
(c) By recital D, the Defendant was recorded as wishing to enter into the agreement for the purposes of the plan terms with the participant to set out the terms and conditions upon which the participant was to be provisionally allocated restricted shares and, potentially, unrestricted shares and the Claimant by executing the agreement provided his consent to the plan terms and the terms and conditions of the grant agreement;
(d) Clause 2 was the grant of a specific number of restricted shares and sub-clause 2.2 incorporated the plan terms by reference with any unrestricted shares having the rights and being subject to the restrictions set out in the plan terms, the articles and the grant agreement;
(e) Clause 6.1 set out the terms upon which the company could call for the shares;
(f) Clause 9.15 was the English choice of law clause and the DIFC jurisdiction clause;
(g) As the plan terms were incorporated, the call option provided for terms as to exercise by reference to definitions of good and bad leavers and the exercise at a fair market value at a given date as determined by the Administrator acting reasonably with clause 5.3 giving the rights to exercise the call option if the Claimant became a good leaver.
6. I do not understand it to be disputed but that the Claimant was a good leaver. It follows that the company call option specifically required its exercise by the Defendant and for the administrator, acting reasonably, to determine the value of that exercise. It is the fair market value that the Claimant wishes to dispute.
7. It follows that, correctly categorised, the claim is one by the Claimant that in breach of the provisions under which he was granted the shares, the exercise took place at a figure which was not the fair market value but an undervalue and that the administrator was not acting reasonably in relation to his determination.
8. As to how this claim is to be categorised:
(a) The Defendant says that the grant agreement and the terms of the share incentive plan are to be read together with the employment contract;
(b) Clause 4 of the employment contract specifically provides that the Claimant will be granted an option to purchase 900,000 shares and the exercise will be determined by the Board or the Compensation Committee subject to the terms and conditions applicable to options under the stock plan.
9. The questions then arise as to the correct applicable law and the limitation period. The Defendant maintains that the Claimant was correct to categorise the claim as one to which Article 22 applied. He relies on the definitions in the Schedule of remuneration which provides “the aggregate of an employee’s wages and additional payments” and the definition of “additional payments” as being “any bonus, incentive, grant, commission, drawing, distribution or any other payment made by an employer to an employee that is a) discretionary, b) non-recurring; or c) calculated by reference to the profits of an employee or an affiliate”.
10. I do not consider that the payment for shares is properly to be regarded as a payment within the definition of “additional payment”. It is a capital payment for shares which the employee is being requires to give up as a consequence of the exercise of the company call option. It is not of the same nature as a bonus, incentive, grant, commission, drawing or distribution. It is also not discretionary. It is obligatory once the call option is exercised. It is not “non-recurring” in the sense used in the definition. It is giving up substantive rights to shares in the Defendant and is not calculated by reference to the profits of the employer. It is therefore not a definition of an additional payment. It is also not an unlawful deduction from the employee’s remuneration nor a failure to pay remuneration required under the contract or the law.
11. Although the employment contract provides for the grant of options, the payment to which the Claimant was entitled on the exercise of the options arises not under the employment contract but under the grant agreement which incorporates the share incentive plan and the Articles. So even if the payment were remuneration, it is not remuneration to which the employee is entitled under his employment contract or the law.
12. It follows that if general DIFC law applies the limitation period would be 6 years as it would be in England.
13. It follows that the claim will have been brought in time if made on the above basis. The application will be dismissed on terms that the Claimant provides re-amended particulars of claim which identifies the legal basis of claim and removes the assertion that this is an employment claim with a 6 month limitation period.
14. In relation to costs, having heard submissions, the costs of and occasioned by the amendment shall be paid by the Claimant in any event and there will be no order for costs on the Application.
(a) The Application to contest jurisdiction was accordingly dismissed.
(b) There shall be no order as to costs.
