Claim No: CFI 095/2025

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF FIRST INSTANCE

BETWEEN

OBIE

Claimant/Respondent

and

OSRIC

Defendant/Appellant

ORDER WITH REASONS OF H.E. JUSTICE ROGER STEWART KC

UPON the Judgment of H.E. Justice Maha Al Mheiri (the “Judge”) giving judgment for the Claimant on 28 August 2025 in SCT-313-2025 (the “Judgment”)

AND UPON the Order with Reasons of H.E. Justice Roger Stewart KC dated 6 October 2025 granting limited permission to appeal the Judgment in SCT-313-2025

AND UPON considering the skeleton arguments of Appellant/Defendant dated 17 November 2025 and that of the Claimant/Respondent dated 12 November 2025

AND UPON hearing the parties at an appeal hearing held before H.E. Justice Roger Stewart KC on 8 January 2026 (the “Hearing”)

IT IS HEREBY ORDERED THAT:

1. The appeal is dismissed upon the basis that although to the extent the judgment is based on a finding of fraud, such a finding is not sustainable, the relief granted is nonetheless justified by the Judge’s other findings which are not dependant on any finding of fraud.

2. There is no order as to the costs of the appeal.

Issued by:
Delvin Sumo
SCT Judge and Assistant Registrar
Date of Issue: 13 January 2026
At: 3pm

SCHEDULE OF REASONS

Introduction

1. This is an appeal against the judgment of H.E. Justice Maha Al Mheiri in Claim No. SCT-313-2025 dated 28 August 2025 whereby she set aside the Agreements dated 14 October and 24 October for misrepresentation, required the Defendant to repay AED 50,000, dismissed the Defendant’s Counterclaim and made provision for interest and costs.

2. The appeal is bought based upon the limited permission which I granted by my Order with reasons dated 6 October 2025 which granted permission only in respect of the issue as to whether the Judge considered the issue as to whether the Defendant was fraudulent and whether the rest of the Judgment depended upon that finding.

The Parties

3. The Claimant and Respondent to the Appeal is Obie (the “Claimant”), an individual that was a client and retained the Defendant’s services.

4. The Defendant and Appellant is Osric (the “Defendant”), a legal consultancy firm operating in the UAE. The operative lawyer at the Defendant was Mr Oleg who represented it.

Background

5. The dispute which led to the Judgment in the SCT concerned allegations of misrepresentation by the Defendant regarding its legal status and qualifications and whether it had any qualified local lawyers. The Claimant contended that relying on these misrepresentations, she entered into the agreements and received advice which later proved to be deficient and below the standard of care expected. When the Claimant discovered that the Mr Oleg was not a lawyer and there were no qualified lawyers at the Defendant, she claimed back the fees that she had paid. The Defendant counter-claimed for further fees which were said to be due.

6. The Judge considered the key issues to be:

The Judgment

7. The Judgment considered the issue of misrepresentation and found at paragraph 25, that the Defendant’s conduct and communications created an implied representation that Mr Oleg was a qualified practicing lawyer. That representation was held to have induced the Claimant to enter into the agreement and proceed under the scope email.

8. At paragraph 26 of the Judgment, the Judge referred to Article 40 of the DIFC Contract Law No. 6 2004.

9. Article 40 reads as follows:

10. Paragraph 27 of the Judgment addresses negligence and standard of care. The Judge concluded that the Defendant’s drafting and advice provided to the Claimant, fell below the reasonable standard of care.

11. At paragraph 31, the Judge refers to the principle that where a contract is induced by fraudulent misrepresentation or fraudulent disclosure, avoidance is permitted.

12. At paragraph 34, the Judge appears to have relied upon the existence of fraud in reaching the conclusion that the appropriate relief was recission.

13. At paragraph 36, the Judge rejected the counterclaim relating to the alleged outstanding fees.

14. In Paragraph 44, the Judge considers Facebook posts made by the Mr Oleg’s wife, describing him as a lawyer, and found that these were voluntarily published on a public platform, thereby reflecting how the Defendant held itself out.

The Limited Permission to Appeal

15. As set out in my Order with Reasons dated 6 October 2025, I did not consider that the grounds upon which the Defendant sought to appeal the Judgment gave rise to arguable grounds of appeal save that I considered that there were properly arguable grounds as to:

The Written and Oral Submissions Made

16. The Defendant submitted:

17. The Claimant submitted:

Discussion

18. As is apparent from the grounds upon which I granted permission to appeal, I consider that there are two substantive issues to consider:

19. The background to this is, of course, that this is an appeal from an SCT judgment. The applicable legislation does not permit appeals from the SCT simply on grounds of errors of fact. Article 28 of the DIFC Court Law expressly limits the jurisdiction in relation to appeals from the SCT to questions of law, miscarriage of justice, procedural fairness and matters provided form under DIFC law.

20. This limitation is unsurprising given the intended nature of SCT cases which are dealt with under special procedures. Thus:

21. It will thus generally be inappropriate to allow a party to take “technical” points – provided always that the procedure adopted is fair. It would undermine the central ethos of the SCT if appeals were to be readily allowed on such technical grounds or if appellate judges were to insist on precise and full reasoning in relation to every aspect of a case.

22. Set against the above, is the fact that a finding of fraud is always a serious matter and one to which special rules are applied in general common law court proceedings. In such proceedings, fraud must be clearly and distinctly alleged and allegations will generally be required to be put fairy and squarely to relevant witnesses.

23. Such requirements are unsurprising and flow from the very nature of an allegation of fraud which will involve a charge of dishonesty. Since the seminal decision of the House of Lords in England in Derry v Peake [1875] 14 App Cas 337, it has been plain that an action for fraudulent misrepresentation requires the making of a statement which is false and made dishonestly in that it known to be false or made recklessly without care as to whether it is true or false. Thus, the directors in the case who had made false statements carelessly were not liable.

24. The common law does in appropriate circumstances grant relief against persons who have caused loss to others by careless acts or words but the level of level of opprobrium attached to such findings is different from those which attach to findings which attach to deliberate dishonest acts or words. It is an unfortunate fact that human beings are prone to occasional acts of carelessness. It will be a rare driver of a car who is able to say that he or she has never done something which, if it had caused damage, would not have attracted civil and, quite possibly, criminal liability. However, such liability is viewed differently from someone who deliberately or recklessly drives a car in such a manner as to endanger others. Similarly, it will be a rare person who can say that they have never acted carelessly in their professional lives in such a way that, had damage been suffered by others who were in an appropriate relationship (such as the client of a lawyer) they would not have been vulnerable to an action for damages for financial loss. However, such carelessness is wholly different from that which attaches to someone who sets out to defraud others.

25. As a result of the vulnerability of humans to occasional acts of carelessness, systems are put in place to minimise the chances of such acts causing damage. The more serious that society views such consequences, the greater the systems put in place. Thus, in order to minimise the chances of pilot error causing a catastrophic aeroplane crash there are numerous systems put in place: intensive and repeated training; complete bans on alcohol; the requirement for at least two pilots; numerous mechanical warning systems and so forth. In a different context, that of lawyers and clients, well run law firms will also have intensive training, systems of reminders and supervision in order, for example, to avoid the missing of important deadlines. Such systems are generally not designed, however, to provide defences against a person who is not just careless but deliberately seeks to subvert them.

26. It follows that for a judge to make a finding that a person who has acted dishonestly in making a fraudulent misstatement is to find that such a person has acted in a way which is wholly different and distinct from a person who has made such a misstatement innocently or even carelessly.

27. Given the special requirements and rules of the SCT, I do not consider that it would be appropriate to impose any detailed and specific rules as to the precise way in which a judge should act before making a finding of fraud against a person. However, at the least, it seems to me that justice requires that the person against whom a finding is being contemplated must:

28. In the present case:

29. It follows that I do not consider that there is any basis upon which the Judge was entitled to make a finding of fraudulent misrepresentation if, indeed, she did so. The possibility of such a finding being made was not raised with the Defendant and there is no reasoning justifying the making of such a finding. I should add that, having had the benefit of being addressed by the Defendant’s representative on two occasions, I am quite satisfied that he did not act fraudulently. I consider it plain that he considered and considers that he acted properly in relation to his dealings with the Claimant and did not intend to deceive her. Further, there is no basis upon which I consider that it can be found that he acted recklessly without caring whether his statements were true or false.

30. I consider that, as a matter of justice, the Defendant is entitled to a clear statement that there is no basis for a finding that he was liable for fraudulent misrepresentation.

31. The next question is as to whether the Judgment can and should stand, in terms of its substantive findings, notwithstanding the fact the absence of a finding of fraudulent misrepresentation.

32. Above, I stated that I do not consider that there is any basis upon which the Judge was entitled to make a finding of fraudulent misrepresentation “if, indeed, she did so”. My uncertainty on this point arises:

33. In the Defendant’s submissions on this appeal, reliance was placed on the decision of H.E. Justice Omar Al Muhairi in Salem Dwela v Damac Park Towers Company Limited [2018] DIFC CFI 083 who struck out a claim on the grounds that it was statute barred and commenced more than six years after the relevant breach. Although the Claimant insisted that the claim was one of fraud, there were no particulars of such a claim which would entitle the Claimant to assert that he had six years from knowledge of such a claim in which to bring it.

34. However, as I pointed out at the Hearing, that decision was subject to an appeal, with permission granted by the Judge, which was determined by the Court of Appeal at [2020] DIFC CA 009. The leading judgment was given by Justice Sir Richard Field who with whom the other two members of the court agreed. The Court held that there was an arguable case established for misrepresentation entitling rescission of the relevant agreement which was made within the relevant 15 year time limit with the result that the decision of the Judge was reversed.

35. The following paragraphs of the judgment are of particular relevance:

36. Following the decision of the Court of Appeal, the case came on for trial before Justice Lord Angus Glennie in a decision which I also drew to the parties attention reported at [2021] DIFC CFI 83. The judge rejected the case on its facts but, at paragraph 8 indicated that he did not see why, despite the absence of a specific reference in DIFC law to rescission as an available remedy for misrepresentation, the Court should not, in an appropriate case grant an order for rescission (see paragraphs 8 and 9).

37. In the present case, a central foundation of the Defendant’s argument was that there was no misrepresentation because no loss had been proved to have been suffered. However:

Conclusion

38. In the circumstances, I consider that, on the primary facts found by the Judge, she was right to order rescission and grant the relief that she did grant albeit for reasons different from those expressed by her.

39. I consider that the correct course is accordingly:

40. Given the fact that this Order makes it plain that the Defendant was not liable for fraudulent misrepresentation but that the Judgment was otherwise upheld, I consider it right to make no order as to costs.