Claim No. CFI 055/2025

IN THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF APPEAL

BETWEEN

GANESAN MUTHIAH

Claimant/Respondent

and

ABDUL RAHMAN MOHAMMAD

Defendant/Applicant

REASONS OF H.E. JUSTICE SHAMLAN AL SAWALEHI FOR THE ORDER DATED 20 OCTOBER 2025

Introduction

1. The following are the reasons for the Order dated 20 October 2025 (the “Order”) by which Claim No. CFI-055-2025 was dismissed in compliance with the Decision of the Conflict of Jurisdiction Tribunal (the “CJT”) issued on 13 October 2025.

2. The CJT determined that the Dubai Courts have jurisdiction to hear and determine the present Claim and directed that the DIFC Courts shall cease hearing the Claim.

3. Having considered the parties’ correspondence, I determined that it was appropriate to provide written reasons, both to ensure clarity as to the effect of the CJT’s decision within these proceedings and to maintain a complete judicial record. These reasons therefore explain the procedural background and the legal basis for the Order.

Procedural Background

4. The following summary sets out the principal procedural background. It is provided for context only relevant to my reasons for the Order. It should not be taken as omitting or diminishing the relevance of any facts or statements contained on the record.

5. The Claimant commenced these proceedings by way of a Claim Form dated 9 June 2025, asserting entitlement to payment of USD 5,908,000 and related relief against the Defendant.

6. On 14 July 2025, a Default Judgment was entered into by Judicial Officer Maitha Al Shehhi pursuant to RDC Part 13, awarding the Claimant the claimed sums.

7. On 22 July 2025, upon the Claimant’s ex parte application, this Court issued a worldwide freezing order against the Defendant.

8. The Defendant subsequently filed two applications on 25 July 2025, namely:

9. On 31 July 2025, the execution of the Default Judgment was stayed by consent pending the hearing of the set-aside and jurisdictional applications.

10. Following a hearing held on 14 August 2025, this Court issued an Order dated 19 August 2025 which, inter alia, set aside the Default Judgment, discharged the Freezing Order, and declared that the DIFC Courts had no jurisdiction or should not have exercised jurisdiction over the Claim.

11. On 29 September 2025, the Court issued a Variation Order amending the costs provision in the 19 August Order. The Claimant remained liable to pay the Defendant’s costs of and incidental to the proceedings, such costs to be assessed on the standard basis under RDC Part 40.

12. Thereafter, the Defendant invoked the mechanism under Dubai Law No. (19) of 2016 establishing the CJT to resolve conflicts of jurisdiction between the Dubai Courts and the DIFC Courts.

13. On 13 October 2025, the CJT issued its Decision determining conclusively that:

14. Following the CJT’s Decision, this Court issued the Order dated 20 October 2025, formally implementing that determination by dismissing the Claim for lack of jurisdiction, vacating all prior directions and proceedings, and dismissing all pending applications

Discussion

15. Following the CJT’s determination, this Court is bound, as a matter of constitutional and statutory obligation, to decline jurisdiction and to cease hearing the Claim in its entirety.

16. While the Court retains a limited residual power to address procedural consequences arising prior to the CJT’s Decision, including costs, such power is discretionary and not automatic. The existence of a power to award costs does not, of itself, mandate the exercise of that power in favour of any party.

17. The Court’s discretion as to costs is governed principally by RDC 38.6 and 38.9. Although RDC 38.7 provides that costs generally follow the event, that rule is expressly subject to the Court’s overriding discretion to order otherwise where the circumstances so require.

18. In the present case, the “event” is not a substantive determination on the merits, but a jurisdictional allocation mandated by the CJT. The Defendant has not obtained a judgment on liability, nor has the Claim been adjudicated upon or dismissed on its merits by this Court. The absence of substantive adjudication is a material consideration weighing against a costs award.

19. Crucially, the CJT’s Decision operates to retrospectively clarify that this Court was not the competent judicial forum to determine the Claim. In those circumstances, it would be contrary to principles of procedural fairness and judicial restraint to characterise the Defendant as a “successful party” for the purposes of RDC 38.7.

20. The Defendant did not prevail through litigation conduct before this Court, but rather through a jurisdictional determination made by a superior and final authority external to these proceedings.

21. The Claimant’s recourse to the DIFC Courts, prior to the CJT’s determination, cannot be said to have been abusive, unreasonable, or improperly motivated so as to justify a departure from the general principle that parties should bear their own costs where proceedings are terminated for want of jurisdiction.

22. Further, the Variation Order cannot survive the CJT’s binding determination insofar as it presupposes the continued procedural competence of this Court. Once jurisdiction is conclusively dismissed, ancillary orders dependent upon the Court’s continued seisin must likewise fall away, unless expressly preserved. There is no principled basis upon which a costs entitlement may subsist independently of jurisdiction, particularly where doing so would produce an inequitable result.

23. Accordingly, and in the proper exercise of my discretion under RDC 38.6, 38.9, and 4.2, I order that there shall be no order as to costs. Each party shall bear its own costs incurred in the DIFC Courts proceedings, and any prior directions or orders insofar as they purport to entitle the Defendant to recover costs are hereby set aside.

Issued by:
Delvin Sumo
Assistant Registrar
Date of issue: 13 January 2026
At: 1pm