Claim No. CFI 092/2021

IN THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF FIRST INSTANCE

BETWEEN

(1) SANDRA HOLDING LTD
(2) NURI MUSAED AL SALEH

Respondents/Claimants

and

(1) FAWZI MUSAED AL SALEH
(2) AHMED FAWZI AL SALEH
(3) YASMINE FAWZI AL SALEH
(4) FARAH EL MERABI

Applicants/Defendants

ORDER WITH REASONS OF H.E. JUSTICE LORD ANGUS GLENNIE

UPON the Worldwide Freezing Order of H.E. Justice Sir Jeremy Cooke dated 10 November 2021 and the Order of H.E. Justice Sir Jeremy Cooke dated 30 November 2021 continuing the Worldwide Freezing Order (together the “WWFOs”).

AND UPON the Defendants’ Application No. CFI-092-2021/9 dated 19 March 2024 seeking an inquiry into damages caused by the WWFOs (“Application CFI-092-2021/9”).

AND UPON the Order of H.E. Justice Lord Angus Glennie dated 5 March 2025 granting Application CFI-092-2021/9 and ordering that there be an inquiry into damages, and a detailed claim and supporting evidence in the form of affidavits or witness statements be filed.

AND UPON the Defendants’ Application No. CFI-092-2021/11 dated 28 April 2025 detailing their claim for damages (“Application CFI-092-2021/11”).

AND UPON the Application Hearing before H.E. Justice Lord Angus Glennie on 11 July 2025, with counsel for the Defendants in attendance and the Claimants failing to appear.

AND UPON reviewing the case file and documents filed therein.

IT IS HEREBY ORDERED AND DECLARED THAT:

1. This Court has jurisdiction to hear and determine the Defendants’ Application CFI-092-2021/11.

2. It is declared that the WWFOs dated 10 and 30 November 2021 have caused loss to the Defendants in the amounts of EUR 46,071.96 and USD 574,401.25 for which the Defendants should be compensated.

3. The Claimants shall within 14 days from the date of this Order pay the Defendants those sums pursuant to the undertakings given by them in and set out in paragraph (1) of Schedule B to each of those WWFOs.

4. The Claimants shall pay the Defendants the reserved costs of Application CFI-092-2021/9, summarily assessed in the sum of AED 712,044.08.

5. The Claimants shall pay the Defendants the costs of this Application CFI-092-2021/11, summarily assessed in the sum of AED 306,316.95.

Issued by:
Hayley Norton
Assistant Registrar
Date of issue: 22 July 2025
At: 8am

Introduction

1. In August 2021 the Claimants, Sandra Holding Ltd and Nuri Musaed Al Saleh, commenced proceedings in Kuwait against the Defendants, Fawzi Musaed Al Saleh, Ahmed Fawzi Al Saleh, Yasmine Fawzi Al Saleh and Farah El Merabi making allegations of fraud. The claims were for a sum in excess of USD 46 million allegedly transferred unlawfully from the account of a company called UEL. The details of those claims do not matter for present purposes. It is sufficient to note that in these proceedings (Case No 12850/2021, “the First Kuwaiti Proceedings”) the Claimants sought the appointment of an expert to make determinations on the validity and propriety of those transactions.

2. In support of their claims in the Kuwait proceedings, the Claimants applied to the DIFC Court for, and were granted, a Worldwide Freezing Order or Injunction (“WWFO”). The WWFO was first granted on 10 November 2021 after a hearing without notice to the Defendants; and was continued following an “on notice” hearing on 25 November 2021 (the Order being dated 30 November 2021) which the Defendants did not attend. The WWFOs restrained the Defendants from removing from the DIFC or otherwise in any way disposing of, dealing with or diminishing the value of any of their assets wherever situated up to the value of USD 45 million.

3. In the body of the WWFOs (but not in the heading) the Claimants are referred to as “the Applicant” and the Defendants are referred to as “the Respondent”. In this Order and Judgment, where the Defendants are Applicants and the Claimants are Respondents, to avoid confusion I shall revert to using the terms “Claimants” and “Defendants”.

4. Schedule A to the WWFOs (as granted on 10 and 25 November 2021 and as dated 30 November 2021) listed the Affidavits and Witness Statements relied on by the Claimants. Schedule B set out the Undertakings given to the Court by the Applicant (i.e. the Claimants), paragraph (1) of which was in the following terms:

“(1) If the Court later finds that this Order has caused loss to the Respondent [i.e. the Defendants], and decides that the [Defendants] should be compensated for that loss, the [Claimants] will comply with any Order the Court may make.”

This is commonly referred to as an undertaking (or cross-undertaking) in damages. The requirement for such an undertaking (save in limited circumstances) is set out in the Rules of the DIFC Court at RDC 25.25(1).

5. Paragraph (8) of Schedule B to the WWFOs provided that the Applicant (i.e. the Claimants) have permission to enforce the Order in a number of jurisdictions, including Kuwait, France and the USA.

6. On 24 August 2022 the Defendants applied to the DIFC Court of First Instance to discharge the WWFOs. That application was unsuccessful. The Defendants were found to be in contempt of court. The Defendants appealed.

7. On 6 December 2023 the DIFC Court of Appeal issued its judgment allowing the appeal and setting aside the WWFOs and the Contempt of Court Order. It should be noted, if only as a matter of interest, that the main ground of decision in the Court of Appeal was that the DIFC Courts lacked jurisdiction over the Defendants. That part of the decision has recently been disapproved in Carmon Reestrutura-engenharia e Servicos Tecnios Especiais Lda v Antonio Joao Catete Lopes Cuenda [2024] DIFC CA 003 (“Carmon”). But the decision of the Court of Appeal to set aside the WWFOs in this case would almost certainly have been upheld on the merits of the case, as noted in Carmon at paragraph 204.

The cross-undertaking in damages

8. In its Order of 6 December 2023 the Court of Appeal directed that “any application for an enquiry as to damages relating to the [Claimants’] cross-undertaking in damages shall be filed before the Court of First Instance.” The Defendants duly made such an application. It was heard on 26 February 2025. The Claimants did not appear. The application was successful. In its Order of 5 March 2025 resulting from that hearing the Court ordered an inquiry into damages and gave directions for submitting a detailed claim and supporting evidence in the form of affidavits or witness statements. Costs were reserved.

9. This Order follows from those directions. The Defendants were represented by counsel. The Claimants did not appear and were not represented. It is clear, however, that the Claimants were aware of the Defendants’ application. This is evident inter alia from the response to the application submitted on behalf of the Claimants by their lawyer, Mr Badr Saud Al-Badr, in which they challenged the jurisdiction of the DIFC Courts to make an award of damages against them, that challenge being based on the ruling by the DIFC Court of Appeal that it had no jurisdiction to grant the WWFOs at the suit of the Claimants in the circumstances of the case. I quote the relevant part of the letter from the Claimants’ lawyers (in translation);

“It is established that the lawsuit referred to by the first respondent, registered under number (CFI-092-2021) that was previously filed by the claimant against the respondents, has already been ruled on by the Dubai Financial Centre Courts as not falling within their jurisdiction, which necessarily implies, in accordance with general rules, that the Dubai Financial Centre Courts do not have jurisdiction to hear any claims for compensation based on the aforementioned lawsuit. ...”

10. That argument that the DIFC Courts lack jurisdiction is wrong for at least three reasons. The first is this. The present application was brought by the Defendants on the basis that when seeking and obtaining the WWFOs from the DIFC Court, the Claimants gave an undertaking to the DIFC Court that they would comply with any order that the Court might make as to compensating the Defendants for loss caused to them by reason of the Court making that Order. The Claimants personally submitted to the jurisdiction of the DIFC Courts in that respect. The second reason is that this application is brought before the DIFC Court of First Instance pursuant to the direction of the DIFC Court of Appeal in paragraph 6 of its Order dated 6 September 2023 allowing the appeal. There is no doubt that the Court of Appeal had jurisdiction to make the Order that it made: see Article 5(B)(1)(a) of Law No. 12 of 2004 (the JAL). The hearing of this application is the working out of the Order of the Court of Appeal following on from the Defendants’ successful appeal against the WWFOs. The third reason is that the requirement for an undertaking in damages to be included within an injunction issued by the DIFC Courts is contained in the Rules of the DIFC Court, RDC 25.25(1). The Rules amount to DIFC Regulations: see Nest Investments Holding Lebanon S.A.L. v Deloitte and Touch (M.E.) [2018] DIFC CA 011. It follows that the DIFC Courts have jurisdiction to hear applications under the undertaking in damages, that being an application required by the DIFC Regulations: see Article 14(A)(7) of Dubai Law No. 2 of 2025.

11. There is no doubt that this Court has jurisdiction to hear this Application.

12. The focus of the Defendants’ application for damages pursuant to the Claimants’ undertaking to the Court is on the legal costs incurred by them in resisting steps taken by the Claimants to enforce the WWFOs in jurisdictions other than Dubai. The Court does not necessarily have a complete picture of the steps that were taken by the Claimants in different jurisdictions to bring claims against the Defendants and to enforce the WWFOs against them. So far as this Application is concerned, the relevant proceedings were in France and in the USA, specifically in Massachusetts. I deal with events in these jurisdictions shortly. But it is useful to begin by outlining the steps taken by the Claimants in Kuwait.

Proceedings in Kuwait, France and the USA

Kuwait

13. The Claimants commenced proceedings against the Defendants in Kuwait (the First Kuwait Proceedings) in August 2021 (see paragraph 1 above). These were the proceedings in support of which the WWFOs were granted by the DIFC Court in November of that year.

14. On about 22 November 2021, after the first WWFO issued by the DIFC Court, the Claimants commenced a second set of proceedings in Kuwait (Case No 18977/2021, “the Second Kuwaiti Proceedings”) seeking the appointment of an expert to investigate certain transactions. The allegations related to the alleged mismanagement of UEL by the First Defendant. This second set of proceedings in Kuwait was commenced after the initial grant of the WWFO in the DIFC and before the continuation of the same at the hearing before the DIFC at the end of November 2021.

15. On 27 December 2021 the Claimants commenced precautionary attachments of the Defendants’ assets in Kuwait in support of the Second Kuwaiti Proceedings, but this was rejected by the Kuwaiti courts.

16. On 21 February 2022 the First Kuwaiti Proceedings were dismissed as “null” and “void”.

17. On about 20 March 2022 the Claimants filed a third claim in Kuwait (Claim No. 4701/2022, “the Third Kuwaiti Proceedings”). The Kuwaiti Court appointed an expert to consider the merits of the claims.

18. On 27 April 2022 the Second Kuwaiti Proceedings were dismissed. It is unclear whether there has been an appeal against that decision.

19. The court appointed expert from the Third Kuwaiti Proceedings did not find any merit in the Claimants’ claim. On 23 March 2023 the Kuwaiti Court dismissed those proceedings. It is unclear whether or not the Claimants have appealed that decision.

20. Subject to the question whether any of the orders for dismissal have been appealed in Kuwait, it follows that there is no continuing underlying basis for the claims in Kuwait and no basis then current for continuing the WWFOs at the time the matter came before the DIFC Court of Appeal.

France

21. The Defendants relied upon an Affidavit of Olivier Binder, counsel with the law firm Cornet Vincent Segurel Advocates (“CVS”), who acted for the Defendants in resisting the attempts made by the Claimants to enforce the WWFOs in France. He explained the proceedings in France and spoke to the expenses caused to the Defendants in seeking to resist such enforcement.

22. The following is a brief summary of events in France.

23. On 22 November 2021, after the WWFO was first granted in the DIFC, the Claimants took steps to enforce the WWFO in France. They made clear that the WWFO was sought on the basis of the First Kuwaiti Proceedings. They filed two applications with the Enforcement Judge at the Tribunal Judiciaire de Paris. These were not independent claims but rather claims in which the Claimants applied to the French Courts for direct enforcement of the WWFO.

24. Temporary Attachment Orders were issued in the French Courts against various of the Defendants’ assets for a sum of about EUR 39.8 million. These attachments were renewed on 7 March 2022.

25. On 28 April 2022 the Claimants filed a criminal complaint in the French Courts against the Defendants, along with a civil action for damages. The criminal complaint was dismissed on 24 November 2022.

26. On 4 July 2022 the Defendants’ lawyers in France filed a summons to set aside the Attachment Orders. The date of the hearing was scheduled for 30 January 2023.

27. On 27 February 2023 the French Court issued a judgment vacating the Attachment Orders. On 21 March 2023 the Claimants appealed that decision. After various procedural steps, accompanied by detailed written submissions, that appeal was refused on 14 December 2023. All assets seized in the attachment proceedings were released.

28. The French lawyers were acting for the Defendants under a fixed fee agreement whereby they would be paid EUR 50,000 for their services irrespective of the amount of work carried out. Expenses were agreed to be payable in addition. The French lawyers duly submitted a fee for EUR 50,000 as well as re-claiming disbursements laid out by them in the sum of EUR 5,071.96. The total sum payable to the Defendants’ French lawyers is therefore EUR 55,071.96. That sum has been paid to them by the Defendants.

29. According to Law 700 of the French Code of Civil Procedure a French Court is entitled to award a flat-rate indemnity to partially compensate for expenses incurred, including lawyers’ fees, but this is never equal to nor proportionate to the fees that a client has had to pay his lawyer. On 27 February 2023 the Paris Court of first degree awarded each of the Defendants an amount of EUR 1,500 (i.e. EUR 6,000 in total). On 14 December 2023 the President of the Paris Appeal Court awarded the Defendants as a whole an additional amount of EUR 3,000. The total amount awarded by way of lawyers’ fees was therefore EUR 9,000. Whether or not that sum will be recovered from the Claimants is uncertain, but since it has been awarded by the French Court it cannot also in these proceedings be claimed from the Claimants.

30. Accordingly the expenses sought to be recovered from the Claimants in these proceedings in respect of their dealing with the Claimants’ attempts in France to enforce the WWFOs is EUR 46,0,71.96 (50,000 + 5,071.96 – 9,000).

USA/Massachusetts

31. The Defendants relied upon an Affidavit of John C La Liberte, an attorney with the law firm of Sherin and Lodgen LLP (“the Firm”), who acted for the Defendants in resisting the attempts made by the Claimants to enforce the WWFOs in Massachusetts. He explained the proceedings in Massachusetts and spoke to the expenses caused to the Defendants in seeking to resist such enforcement.

32. The following is a brief summary of events in Massachusetts.

33. On 29 March 2022 the Claimants sought recognition and enforcement of the WWFOs in the USA, before the Massachusetts Courts. They asserted two causes of action. They sought recognition of the WWFOs under principles of comity; and they sought recognition of the WWFOs under the Massachusetts Uniform Foreign Judgment Act.

34. It was in light of this that on or about 18 April 2023 the Defendants retained the Firm to defend them in resisting the Claimants’ application.

35. Following a hearing on 23 May 2022, a Judge of the Massachusetts Superior Court denied the Claimants’ request for a preliminary injunction. Thereafter, following a motion to dismiss filed by the Firm on behalf of the Defendants, the Claimants agreed to voluntarily dismiss the Massachusetts action with prejudice once the DIFC Court of Appeal issued its decision on 6 September 2023. The action against the third-named Defendant (Yasmine Fawzi Al Saleh) was in fact only concluded on 20 October 2023.

36. The Firm charged fees of USD 574,401.25 in respect of its work in defending the Claimants’ attempts to enforce the WWFOs in Massachusetts. That sum has been paid to the Firm by the Defendants. Attorney’s fees are not recoverable in Massachusetts. Accordingly the Defendants’ claim under this head of claim is that sum of USD 574,401.25.

Discussion

37. The jurisprudence concerning the assessment of damages as part of an inquiry into damages pursuant to an undertaking to that effect begins, for practical purposes, with the dictum of Brett LJ in Smith v Day (1882) 21 Ch D 421 at 427-8 as adopted in recent times by Lord Diplock in F Hoffman La Roche & Co AG v Secretary of State for Trade and Industry [1975] AC 291, 361. The most recent leading authorities are the decisions of the Court of Appeal in Abbey Forwarding Ltd v Hone (No 3) [2015] Ch 309 and in SCF Tankers Ltd v Privalov [2018] 1 WLR 5623 affirming the judgment of Males J. On the facts of this case it is not necessary to attempt a detailed analysis of the principles to be applied. It is sufficient to refer to the judgment of Males J in SCF Tankers at paragraph 47 where he said this:

“... the defendants are entitled to recover damages for the losses suffered by them as a result of the freezing orders (not as a result of the litigation), assessed by reference to ordinary contractual principles, including principles of causation, mitigation and remoteness, although these principles may need to be applied with some flexibility to take account of the fact that the analogy with breach of contract is not exact ...”

38. In terms of causation, there is no doubt that the legal expenses incurred in France and Massachusetts were caused by the actions of the Claimants in seeking to enforce the WWFO in those jurisdictions. It was perfectly reasonable for the Defendants to resist those attempts, and they were successful in doing so. No problems of mitigation or remoteness arise. The WWFOs expressly contemplate that the Claimants will take steps in France and the USA to enforce them. Nor is there any difficulty in recovering legal costs incurred in jurisdictions where, according to local law or practice, costs are not recoverable. Those irrecoverable costs are recoverable as damages in this jurisdiction: c.f. Gulf Wings FZE v Mr Kamel Abou Aly [2022] DIFC CA 014 at paragraph 26, where such a claim was expressly contemplated by the Court of Appeal.

39. I shall therefore award the irrecoverable costs in France and Massachusetts as detailed in paragraphs 30 and 36 above as damages pursuant to the Claimants’ cross- undertaking in damages.

40. The Defendants asked me to go further and award them exemplary damages. Such an award was contemplated (but not granted) in Smith v Day at p.428, but that was under reference to the possibility that the injunction was obtained fraudulently or maliciously. I would prefer to reserve my position on the question of whether such an award is ever competent. Suffice it to say that I see no basis in the present case for the award of additional damages on this ground.

Costs

41. The Defendants have been successful. They are entitled to recover the costs reserved in paragraph 7 of the Order of 5 March 2025 (see paragraph 8 above). I assess those costs at AED 712,044.08. They are also entitled to their costs of this hearing. I assess those costs at AED 306,316.95.