April 21, 2025 court of first instance - Orders
Claim No. CFI 031/2017
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE COURT OF FIRST INSTANCE
BETWEEN
KIAN SAADT YAZDI
Claimant
and
United Arab Bank PJSC
Defendant
ORDER WITH REASONS OF H.E. JUSTICE RENE LE MIERE
UPON the Part 8 Claim Form dated 29 June 2017
AND UPON the Defendant’s Defence without Counterclaim dated 26 November 2017 (the “Defence”)
AND UPON the Order of H.E. Justice Omar Al Muhairi dated 14 January 2018 (the “Inspection Order”)
AND UPON the Consent Order dated 28 May 2018 (the “Stay Order”)
AND UPON the Claimant’s Application No. CFI-031-2017/5 dated 2 August 2024 seeking an order to revoke the Stay Order and continue proceedings in accordance with Part 8 of the Rules of the DIFC Courts (the “RDC”)
AND UPON the Order with Reasons of H.E. Justice Rene Le Miere dated 31 October 2024 continuing the Claim under the Part 7 procedure and discharging the (i) the Inspection Order (ii) the Stay Order
AND UPON the Case Management Order of H.E. Justice Rene Le Miere dated 21 November 2024
AND UPON the Claimant’s Application No. CFI-031-2017/7 dated 14 March 2025 for a Request for Further Information in relation to the Defence pursuant to RDC 19 (the “Application”)
IT IS HEREBY ORDERED THAT:
1. The Defendant shall, within 14 days, provide responses to Requests 1,2,4,6 and 7 of the First Request and Request 2 of the Second Request of the Claimant's Request for Further Information dated 27 November 2024.
2. The costs of the Application shall be the Claimant's costs in the case.
Issued by:
Delvin Sumo
Assistant Registrar
Date of issue: 21 April 2025
At: 10am
SCHEDULE OF REASONS
Summary
1. The dispute involves a banking relationship between the Defendant, United Arab Bank (“UAB”, the “Bank”, or the “Defendant”), and Pacific Control Systems LLC (PCS). UAB provides various banking facilities to PCS, including a credit facility exceeding AED 100 million.
2. UAB required the Claimant, Kian Saadt Yazdi, a major shareholder in PCS, to provide a personal guarantee for these facilities and asserts that he did provide a personal guarantee (the “Personal Guarantee”).
3. The Claimant disputes the authenticity of the Personal Guarantee, asserting that the signature is forged.
4. The Claimant filed a Part 8 Claim Form seeking a declaratory judgment that the Personal Guarantee is void due to forgery.
5. UAB denies the Claimant's allegations, stating that the Claimant willingly executed the Personal Guarantee and that a Bank employee, Mr. Zeshan Mahmood, verified the signature.
6. The Court ordered UAB to allow inspection of the original Personal Guarantee, but the Bank could not comply as it was held by Kuwaiti courts, which determined the signature was a forgery.
7. The proceedings were stayed to allow the document to be examined, but the stay was later discharged, and the case was ordered to proceed under the Part 7 procedure.
8. A case management order set timelines for document production, witness statements, and trial, scheduled for 20 October 2025.
9. The Claimant applied to UAB for further information regarding the execution and verification of the Personal Guarantee, which UAB opposed.
10. The Claimant argues that the requests for information are necessary to clarify the execution and verification of the Personal Guarantee and to prepare for trial.
11. UAB contended that the requests were unnecessary and should be addressed through disclosure and evidence.
12. For the reasons below, the Court will order that:
(a) The Defendant shall, within 14 days, provide responses to Requests 1,2,4,6 and 7 of the First Request and Request 2 of the Second Request of the Claimant's Request for Further Information dated 27 November 2024.
(b) The costs of the Application will be the Claimant's costs in the case.
The Personal Guarantee
13. PCS is incorporated in the UAE. UAB provided various banking facilities to PCS, including a substantial credit facility exceeding AED 100 million, an invoice discounting facility, and various facilities related to letters of credit. The Claimant is a major shareholder in PCS, owning 35% of the shares alongside his father.
14. UAB required the Claimant to provide a personal guarantee to support the Bank's facilities.
15. In 2016, UAB sought to rely on a personal guarantee signed by the Claimant and dated 10 December 2014 (the “Personal Guarantee”). That guarantee extended to AED 125 million, with interest, charges, and expenses.
16. The Claimant challenges the authenticity of the Personal Guarantee. The Claimant says:
(a) he and his father had “delegated all managerial and governance powers” in PCS to its CEO;
(b) he was unaware of the Personal Guarantee or the banking facilities provided by UAB; and
(c) the signature on the Personal Guarantee is forged.
The Claim
17. By a Part 8 Claim Form issued on 29 June 2017, the Claimant seeks a binding declaratory judgment that the Personal Guarantee was signed by another person using his name and signature and is, therefore, void ab initio as a binding instrument.
18. On 29 November 2017, UAB filed its Defence. UAB denies the Claimant’s Part 8 Claim and claims:
(a) The Claimant executed the Personal Guarantee;
(b) The Claimant willingly, intentionally, and validly executed the Personal Guarantee and is now attempting to evade payment of the amounts owed to UAB thereunder; and
(c) An employee of UAB, Mr Zeshan Mahmood, verified the signature of the Claimant
The stay
19. On 14 January 2018, the Court issued an order that UAB give inspection of the original of the Personal Guarantee; and verification of the Claimant’s signature by Mr Zeshan Mahmood, (the “Inspection Order”).
20. UAB was unable to comply with the order for inspection because the Personal Guarantee was in the possession of Kuwaiti courts, where UAB had sought to enforce it.
21. On 28 May 2018, the Court issued a consent order staying the proceedings until 31 September 2018 to allow for the examination of the original Personal Guarantee held by the Kuwaiti courts, or until the Kuwaiti proceedings permit such examination (the “Consent Order”).
22. The proceedings in the Kuwaiti Courts have concluded, but despite UAB's requests, the Kuwaiti courts have not returned the Personal Guarantee to UAB because they have determined that the signature is a forgery.
23. The Claimant applied to this Court for an order that the Consent Order be revoked, and the proceedings continue in accordance with Part 8 of the Rules of the Dubai International Finance Centre Courts (the “RDC”).
24. UAB opposed the revocation of the Consent Order and argued that if the Consent Order is revoked, the Court should order that the Claim continue as if the Claimant had not utilised the Part 8 procedure.
25. On 31 October 2024, the Court ordered:
(a) The Claim shall proceed to continue under the Part 7 procedure.
(b) The Inspection Order shall be discharged.
(c) The Stay Order shall be discharged.
(d) The Registry shall list a Case Management Conference on a date suitable to the Court and the parties.
Case management order
26. By a case management order of 21 November 2024, the Court ordered, amongst other things;
(a) Standard production of documents by 4pm (GST) on 4 April 2025.
(b) Requests to Produce by 4pm (GST) on 4 April 2025.
(c) Objections to Requests to Produce by 4pm (GST) on 18 April 2025.
(d) If there are no objections, produce documents within 21 days of the Request to Produce and by 4pm (GST) on 25 April 2025.
(e) A party dissatisfied with objections may apply for a Document Production Order by 4pm (GST) on 25 April 2025 using the Part 23 Form. The usual RDC 23 timelines apply. Further applications are allowed after 21 March 2025.
(f) Parties to comply with Disclosure Orders and file a Document Production Statement within 7 days of the Order.
(g) Signed statements of witnesses of fact and hearsay notices, where required, shall be served no later than 4pm (GST) on 11 June 2025.
(h) Supplementary statements of witnesses of fact shall be served within 3 weeks after that and, in any event, by no later than 4pm (GST) on 2 July 2025.
(i) The trial of this matter shall be listed at 11am GST on Monday, 20 October 2025, with an estimated duration of four days at trial.
The RFI application
27. By Application No. CFI-031-2017/7 issued on 14 March 2025 (the “Application”), the Claimant has applied for an order pursuant to RDC Part 19 that UAB, within 14 days, provide responses to the Claimant's Request for Further Information dated 27 November 2024 (“RFI”).
28. UAB opposes the order sought.
29. The RFI concerns UAB’s allegations that the Personal Guarantee was executed by the Claimant and verified/witnessed by a Bank employee named Zeeshan Mahmood. The RFI also requested confirmation that the Bank had other documents bearing the Claimant’s signature.
30. On 20 January 2025, UAB served a reply to the RFI (“Reply”).
31. The Reply did not answer any of the requests for information, except to state the name of the witness to the Personal Guarantee. Otherwise, it gave the same response to every question:
“The information sought is not reasonably necessary and proportionate to allow the Claimant to prepare his own case or to understand the case he has to meet.”
Claimant’s arguments
32. The Claimant's arguments in support of this Application are as follows:
(a) The requests are straightforward and proportionate. They specifically aim to obtain additional information to clarify the purported execution and verification of the Claimant's signature. This includes details about the venue, timing, and circumstances of the purported execution/verification, as well as the existence of other documents in the Claimant's name bearing the purported signature.
(b) UAB has invited the Court to find certain factual matters in its favour and bears the burden of proving them. However, these factual particulars are not pleaded in the defence. A request for these particulars is necessary for the Claimant to understand the case he needs to address.
(c) The material details of the purported execution/verification event will likely be addressed in the defendant's trial evidence. However, this is not sufficient. The Claimant is entitled to know the circumstances of the alleged execution/verification in advance to prepare his evidence and for the disclosure phase. There is no rationale compatible with the overriding objective of the litigation process for withholding important factual particulars until evidence is due, which is several months away.
(d) These requests are not disproportionate. The information sought is central to the dispute and should not be kept 'under wraps' until the trial.
Defendant’s arguments
33. The Defendant presents several arguments why the RFI application should be dismissed:
(a) The requests in the RFI are matters for evidence during the proceedings and are not necessary or proportionate for the Claimant to prepare his case or understand the case he must meet. The information sought is not reasonably necessary for the Claimant's case preparation.
(b) The Defendant responded to Request 5, which sought clarification on the identity of the employee who verified the Claimant's signature, even though the Claimant already knew the answer. This indicates that the request was unnecessary.
(c) The Claimant's requests are a 'fishing expedition'; the requests are not essential for the Claimant to understand the case he must meet.
(d) The RFI Application is unnecessary, untimely, and lacks a real basis because the queries relate to matters that are properly the subject of disclosure and/or evidence. As per the Case Management Order, the ongoing disclosure process is the appropriate avenue for such requests.
(e) The RFI Application is misconceived because the Claimant is pressing for evidence rather than information, which will be addressed through the disclosure process and exchange of witness evidence.
(f) The Defendant is committed to complying with document production obligations and is prepared to respond to reasonable and proportionate requests for further information in due course.
Claimant’s reply arguments
34. The Claimant presents several arguments in response to the Defendant's opposition to the RFI Application:
(a) The Defendant mischaracterises the RFI as a "fishing expedition". The RFI is necessary to address unresolved issues related to the execution and verification of guarantee documents, which are not adequately covered by the Defendant's disclosures.
(b) The RFI is necessary due to the Defendant's longstanding failure to produce the original Personal Guarantee for inspection. The Defendant has not provided a credible explanation for the missing document, which prevents handwriting experts from examining it.
(c) The RFI is narrowly focused and targets key issues, such as the execution and verification of the Personal Guarantee and other guarantee documents. These questions are straightforward and essential for understanding the case. The RFI is not a fishing expedition.
(d) The Defendant has not articulated a clear case regarding the execution and verification of the Personal Guarantee and other guarantees. The Defendant's case is unparticularised, lacking details about where and how the documents were signed and verified, which is crucial for the Claimant to prepare this defence.
(e) The Defendant's disclosure is insufficient, as it does not include documents relevant to the key allegations about the signing and verification of the guarantees. This lack of disclosure supports the Claimant's argument that the RFI is necessary to obtain critical information.
Principles
35. The Court's is guided by the principles set out in RDC Part 19.
36. RDC 19.1 provides that the Court may at any time order a party to:
“(1) clarify any matter which is in dispute in the proceedings;
or
(2) give additional information in relation to any such matter;
whether or not the matter is contained or referred to in a statement of case.”
37. RDC 19.6 requires that a request be concise and strictly limited to matters that are reasonably necessary and proportionate to enable the requesting party to prepare their own case or understand the case they must meet. When considering an application for orders under RDC 19.1 for clarification of a disputed matter or the provision of additional information, the Court will evaluate whether the information requested is reasonably necessary and proportionate to enable the Claimant to prepare their case or understand the case they must confront.
38. In the context of Requests for Information, "reasonably necessary" means that information is not indispensable but is justified through careful consideration of all relevant circumstances. It involves a balanced judgment that considers the need for fair and efficient resolution of the issues, cost-effectiveness, and overall justice. The term implies that the information is appropriate and adapted to achieve a just, quick, and costeffective resolution of the case rather than being strictly essential or unavoidable.
39. The RFI should be focused and limited to obtaining information that is essential for the requesting party to prepare his case. The information sought should help the requesting party gather the necessary details to effectively build and present his arguments, evidence, and overall case strategy. The information should clarify the claims, defences, and evidence the opposing party will present, allowing the requesting party to anticipate and respond to these points.
First Request
40. I will first consider the First Request, which concerns the execution of the Personal Guarantee.
41. The details of the execution and verification of the Personal Guarantee are crucial for the Claimant to prepare his evidence and for the disclosure phase.
42. Where the Claimant's case is that he did not sign the Personal Guarantee, he is primarily trying to prove a negative—that he did not sign it. This involves demonstrating that the signature on the document is not his. However, this negative assertion can be supported by positive evidence, such as alibi evidence, showing that he was elsewhere at the time the document was allegedly signed. Witnesses can testify about the circumstances surrounding the signing of the document or the Claimant's whereabouts. The Claimant cannot investigate and present such evidence if he does not know when and where the Defendant asserts the Claimant signed the document. Such information is particularly important when the Personal Guarantee was executed more than 10 years ago, and the Bank does not specify when and where the Personal Guarantee was signed and verified. This is crucial if the Bank’s position is that the Personal Guarantee was signed in Dubai, as the Claimant says he has evidence showing he was not in Dubai on the alleged date of execution. In contrast, if the Bank’s position is that the Personal Guarantee was signed elsewhere, the Bank must indicate where so that the Claimant knows what case he must meet.
43. The Requests are reasonably necessary to enable the Claimant to prepare his own case or understand the case he must confront.
44. The requests are proportionate. If the Defendant intends to adduce evidence from Mr. Mahmoud, it must obtain the requested information from him. If the Defendant cannot provide the information because it is unable to obtain a statement from Mr. Mahmoud, or if he does not remember, or for any other reason, then the Defendant must communicate this. The Claimant will then know the case he must address.
45. Withholding this information until witness statements are served or until the trial would be contrary to the overriding objective of ensuring that the case is dealt with expeditiously and fairly.
46. It is not sufficient to state that the requested information will be provided later, whether through disclosure or witness statements. If the information falls within the scope of the rule and it is reasonably necessary and proportionate to have the information provided at this stage, then the Court may so order, even if it would be supplied later (see, e.g., Fairclough v Tosi Limited, 99 Hippos Limited [2022] EWHC 2714 (Ch), [36]).
47. I will require the Defendant to answer the following Requests:
1. What steps were taken by the Bank to arrange the execution of the 2014 PG?
2. In which building and in whose office was the 2014 PG executed?
4. What steps were taken to verify the identity of the person who signed the 2014 PG in the Claimant’s name?
6. What steps were taken to perform the purported verification of the Claimant's signature?
7. Is it the Banks’ case that the Claimant signed the 2014 PG in Zeeshan Mahmood’s presence? If not, what is the Bank’s case?”
48. I will not require the Defendant to answer Question 3:
“Who was in the room when the Personal Guarantee was executed?”
49. Interrogatories were not permitted regarding the names of the other parties’ witnesses unless they were material facts in the claim. The same should apply to a request under RDC Part 19. Whether anyone else was in the room when the Personal Guarantee was executed is not a material fact; it is only a request to identify potential witnesses.
50. The Defendant has already answered Question 5.
“Who was the “employee of the Defendant” who purported to verify the signature of the Claimant?”
Second Request
51. The Claimant says that by the Second Request, he seeks confirmation that the Defendant does not hold other purported guarantee documents in the name of the Claimant.
52. The Second Request requests information concerning:
(a) Defence Paragraph 2(b) under, wherein it is pleaded that:
“Since 2014, approximately seventeen guarantees have been granted by the Claimant for the benefit of the lenders of Pacific Control Systems LLC. It is understood (on the basis of the Claimant’s allegations) that the Claimant holds a seventeen per cent (17%) shareholding in Pacific Control Systems LLC, alongside his father, Mr Hassan Yazdi and Mr Dilip Rahulan, with therefore a vested interest in the affairs of Pacific Control Systems LLC.”
(b) Paragraph 2(c) under, wherein it is pleaded that:
“It has been stated to the Defendant by the Claimant and his authorised representatives that the majority of the aforementioned guarantees were forged. Surprisingly, it has also been suggested that the Claimant does not intend to comply with its obligations under those guarantees for which no forgery claim has been made (such as a personal guarantee granted to Bank MISR by the Claimant).”
53. The Requests are:
“1. Please confirm whether the Bank has entered into separate credit facility agreements with Pacific Control Systems prior to 10 December 2014. (Request 2(1)).
2. Please confirm whether the Bank holds other purported guarantee documents bearing the Claimant’s signature. (Request 2(2)).”
54. In an RFI under RDC Part 19, a party can request reasonably necessary information to clarify matters in dispute or prepare their case. However, RFIs are generally intended to seek clarification on specific issues rather than to obtain documents.
55. Requests for documents are typically handled through the disclosure process, where each party is required to provide relevant documents in their possession, custody, or control. This process is governed by RDC Part 28.
56. That said, an RFI can sometimes include questions about the existence or location of documents if this information is necessary to understand the case or prepare for disclosure. For example, a party might ask whether certain documents exist or where they are kept, but the actual production of those documents would be addressed through disclosure.
57. A request should be “strictly confined to matters which are reasonably necessary and proportionate to enable the requesting party to prepare his own case or to understand the case he has to meet”.
58. The Defendant’s pleas in [2(b)] and [2(c)] of its defence refer to guarantees granted by the Claimant for the benefit of the lenders of PCS “since 2014”. The Bank has not pleaded that it entered into separate credit facility agreements with PCS prior to 10 December 2014. It is not reasonably necessary to answer Request 2 (1) to clarify any matter in dispute or for the Claimant to prepare his case.
59. Request 2 (2) is whether the Bank holds other purported guarantee documents bearing the Claimant’s signature.
60. Request 2(2) is reasonably necessary and proportionate because the information requested is relevant to the case, specific, proportionate., and clarifies issues.
61. The critical issue is the authenticity of the Claimant's signature on the Personal Guarantee. Knowing whether there are other guarantee documents with the Claimant's signature could help establish a pattern of forgery or authenticity, which is directly relevant to the case.
62. The request is specific and targeted, asking only about other guarantee documents bearing the Claimant’s signature. It is not overly broad or a fishing expedition.
63. The request is proportionate to the case's needs. It seeks information that could significantly impact the determination of whether the Personal Guarantee is genuine or forged.
64. The information sought could clarify the issues in dispute. Paragraph 2 (c) of the defence pleads that since 2014, approximately 17 guarantees have been granted by the Claimant for the benefit of the lenders of PCS. Paragraph 2 (d) then alludes to whether those guarantees are genuine or forged. It is reasonably necessary to clarify whether the Defendant holds other purported guarantee documents bearing the Claimant's signature. If it does, it will be relevant whether the signatures on them are genuine and the circumstances under which they were executed compared to the circumstances in which the Personal Guarantee was executed.
65. It will further the overriding objective to inform the Claimant whether the Defendant holds other purported guarantee documents bearing the Claimant's signature. If the Defendant does not, that will save the parties the time and trouble of pursuing the matter further. If the Defendant does, the Claimant can pursue inspecting the documents through the Part 28 procedures.
Conclusion
66. The Defendant shall, within 14 days, provide responses to Requests 1,2,4,6 and 7 of the First Request and Request 2 of the Second Request of the Claimant's Request for Further Information dated 27 November 2024.
Costs
67. The Claimant was partly but not wholly successful in his Application.
68. The appropriate order is that the costs of the Application be the Claimant’s costs in the case.
