Claim No: CFI 041/2023

IN THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF FIRST INSTANCE

BETWEEN

MIQAL

Claimant/Respondent

and

MERANI

Defendant/Appellant

ORDER WITH REASONS OF DEPUTY CHIEF JUSTICE H.E. ALI AL MADHANI

UPON the Judgment of H.E. Justice Maha Al Mheiri dated 19 May 2023

AND UPON the Appellant’s Appeal Notice dated 25 May 2023

AND UPON the Order with Reasons of Justice Sir Jeremy Cooke dated 2 June 2023 granting partial permission to appeal

AND UPON reviewing all relevant material and evidence available in the Court file

AND UPON hearing from the parties at a Hearing held before me on 24 July 2023

IT IS HEREBY ORDERED THAT:

1. The appeal is dismissed.

2. The Appellant shall pay the Respondent’s DIFC Courts’ filing fee and costs of this appeal on the standard basis, to be assessed by the Registrar, if not agreed.

Issued By:
Delvin Sumo
Assistant Registrar
Date of issue: 11 September 2023
At: 2pm

SCHEDULE OF REASONS

1. The appeal relates to a written contract between the parties dated 5 July 2023, for the provision of services in relation to a project for the construction of fit-out and installation works at the Claimant’s villa (the “Contract”). The terms of the Contract were noted that payment would include a 75% down payment in the amount of AED 325,776.94 and 25% payment upon completion of the scope of the project, being AED 108,592.31.

2. The Respondent issued a claim for recovery of damages in the amount of AED 434,369.25 due to the Defendant’s failure in completing the contracted works within the agreed relevant time which resulted in the Respondent contracting a third party to finish the Defendant’s agreed scope of work. The Appellant says that the works had been completed to a satisfactory standard and the Appellant only halted its agreed works based on the Respondent’s failure in paying the remainder of the Contract amount. After an unsuccessful consultation the matter was transferred before H.E. Maha Al Mheiri (the “SCT Judge”), in coming to her determination, the SCT Judge ordered that the parties jointly instruct an independent expert for the assistance of the Court. In considering the expert report, evidence and submissions on behalf of the parties, the SCT Judge granted a judgment in favour of the Respondent recorded at paragraph 30 of her findings which concluded that the Respondent paid the Defendant AED 434,369.25 in respect of works worth AED 199,332.05 and that therefore the Respondent was entitled to a refund of AED 235,037.20.

3. The Appellant issued this appeal seeking recalculation of the amount granted in favour of the Respondent when considering this appeal and to reconsider the percentage of works completed on the project based on the expert’s inaccuracies in evaluating concluding and evaluating his findings. The Appellant maintains now that only AED 375,770 was paid by the Claimant. Considering that there was no evidence about such payments, Sir Jeremy Cooke found that there was a reasonable prospect of success for the Appellant in showing that the less sum was paid by the Respondent and the SCT Judge had mistakenly referred to an agreement that the higher sum was received by the Defendant.

4. On 2 June 2023, Sir Justice Jeremy Cooke granted the Appellant’s permission to appeal, namely on the ground of whether the Claimant paid the sum of AED 434,369.25 or AED 375,770 with the potential impact on the sum payable by the Defendant to the Claimant. The parties were granted permission to adduce evidence as to what payments were made by the Respondent to the Appellant so that any error made by the SCT Judge can be rectified. I remind myself of Rule 53.7 of the Rules of the DIFC Courts (the “RDC”) which states that RDC Part 44 does not apply to matters in the Small Claims Tribunal including appeals from the same. Furthermore, RDC Part 53 now makes specific provisions from the SCT. In my view, there is nothing in RDC Part 53 which prevents or otherwise regulates the introduction of fresh evidence in an appeal from the SCT and so it is a matter left for the judge hearing the appeal.

5. The Court has not been provided with any fresh new evidence. As a result, I will be reviewing the documents that had been submitted by both parties to date to determine the main live issue relevant to the calculation of the SCT Judge. The Court will not reassess or consider other matters such as: the percentage of works that had been completed by the Appellants, the permission to appeal granted by Sir Justice Cooke were confined to one ground namely the amount that had been paid by the Respondent.

6. I note that on 27 September 2022, the Respondent wrote a letter to the Appellant complaining about the quality and the standards of work completed on the project and in the third paragraph, the Respondent indicated that in accordance with the terms of their agreement the funds which they have paid have not been properly utilised and it resulted in overspending and the Appellant’s inability to provide quality works. It goes on to say that the Appellant should have received 75% of the total agreement, however the Appellant at the date of that letter received 90% of the Agreement and was asking for an additional amount to continue the works. The purpose of that letter was also to put the Appellant on notice that the remaining works will be assigned to a third party to undertake works which had been omitted by the Appellant. However, when reconciling the payment of 90% of contract value (AED 390,932.33) with the proof of receipts submitted by the Claimant (in total of AED 389,945), there is a shortfall of AED 987 from the alleged 90% payment, which will have to be considered when recalculating the amount that will be awarded to the Claimant.

7. Based on the above, the calculation made by the SCT should be rectified accordingly and I make this decision based on the Respondent’s letter of 27 September 2022 and the receipts attached to the claim form which proves that the Respondent only paid 90% of the total contract value AED 434,369.2 meaning a payment of AED 389,945 was made to the Appellant for the project and the SCT Judge made in error in assuming that the Respondent paid the full contract value.

8. By virtue of the expert’s findings, it was concluded that the Appellants completed 45.89% of the contracted works, as such the Appellant should be entitled to an amount of AED 178,945.76 (AED 389,945 x 45.89%) and the remaining balance should be refunded to the Claimant being AED 210,999.24.

9. As to the other points raised by the Appellant during the Hearing and in the absence of any fresh new evidence put forward, I do not consider that the other grounds of appeal offer much in the way of assistance to the Appellant. The submissions made relating to the grounds of appeal have been dealt with at length by the Judge and it certainly has been dealt with by the expert during his evaluation and findings. As such, I see no real prospect of success that the Appellant should be granted a permission to Appeal. In the circumstances, I dismiss the appeal and the Judgment of SCT Judge, expect paragraph 30 of her judgment, remains in place.

10. As to costs, the usual order that costs follow the event. The Appellant made the decision to issue this appeal and as a result the Respondent has incurred costs. The Appellant’s appeal has failed. The Respondent has issued no cross appeal and in doing so accepted the decision of the SCT Judge.

11. In the circumstances, I consider it fair and reasonable that the Appellant should pay the Respondent’s costs of this appeal.

Conclusion

12. The Appellants shall be ordered to refund the Respondent a total amount of AED 210,999.24.

13. The Appellants shall pay the Respondent’s DIFC Courts’ filing fee and costs of this appeal.