Claim No: CFI 057/2021

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

In the name of His Highness Sheikh Mohammad Bin Rashid Al Maktoum, Ruler of Dubai

IN THE COURT OF FIRST INSTANCE
BEFORE H.E. JUSTICE LORD ANGUS GLENNIE

BETWEEN

KHALED SALEM MUSABEH HUMAID AL MHEIRI

Claimant

and

(1) MR MOHAMMAD EZELDDINE EL ARAJ
(2) MR JOHN CAMERON

Defendant

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JUDGMENT OF H.E. JUSTICE LORD ANGUS GLENNIE

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UPON the Part 7 Claim Form (the “Claim”)

AND UPON the Second Defendant’s Acknowledgment of Service dated 15 June 2021

AND UPON the Amended Particulars of Claim dated 11 May 2023

AND UPON the Second Defendant’s Defence without Counterclaim dated 8 June 2023

AND UPON the Claimant’s Amended Reply to Defence dated 15 April 2025

AND UPON hearing counsel for the Claimant and counsel for the Second Defendant at the Trial held before H.E. Justice Lord Angus Glennie from 28 to 30 April 2025 (the “Trial”)

AND PURSUANT TO the Rules of the DIFC Courts (the “RDC”)

IT IS HEREBY ORDERED THAT:

1. The Claimant’s Claim against the Second Defendant fails and is dismissed

2. The Claimant shall pay the Second Defendant’s costs of this action to be assessed by the Registrar on the standard basis if not otherwise agreed.

Issued by:
Delvin Sumo
Assistant Registrar
Date of Issue: 16 June 2025
At: 9am

SCHEDULE OF REASONS

Introduction

1. The Claimant, Khaled Al Mheiri (the “Claimant”), variously referred to in witness statements and contemporaneous documents as “Mr Al Mheiri”, “Mr Almheiri”, “Khaled” or “KAM”, is a businessman resident in Dubai. He owns companies and investments in the UAE and globally.

2. The Defendant, John Cameron, ( “Mr Cameron” or “D2”) is also resident in Dubai. He was originally the Second Defendant in these proceedings but became the only Defendant when proceedings against the First Defendant, Ezaldeen El Araj ( “Mr El Araj” or “D1”), sometimes referred to as “Ezaldeen”, were discontinued in favour of arbitration.

3. In this action, the Claimant seeks payment from Mr Cameron under an Indemnity Agreement dated 26 August 2015 (the “D2 Indemnity Agreement”) covering the Claimant’s personal liability to Qatar National Bank SAQ ( “QNB”) for a loan taken out by him for the benefit of businesses in which he and Mr Cameron (and others) were involved, which loan was not repaid due to a failure of those businesses. The Claimant seeks judgment for AED 91,250,000 (minus AED 1,995,560 received from Mr El Araj), plus interest and costs. As noted above, Mr El Araj was formerly the First Defendant in these proceedings.

4. Mr Cameron admits that he entered into the D2 Indemnity Agreement. But he contends that he did so on the basis of certain representations made to him by or on behalf of the Claimant which turned out to be untrue. For this reason, and for other reasons which will be explained later in this judgment, he denies that the D2 Indemnity Agreement is enforceable against him. Little, if anything, turns on the precise wording of the provisions of the D2 Indemnity Agreement. I therefore do not propose to set it out at any length in this judgment.

Witness evidence

5. I heard evidence from the Claimant and from Mr Cameron. Both had filed witness statements for the trial and at earlier stages of the proceedings, and at the Trial they were cross-examined on those statements where relevant to the resolution of the dispute. This was the only oral evidence at trial. There were also signed statements from Mr El Araj and Mr Nedjar which were filed in the process and were relied on to a limited extent as hearsay evidence.

6. My assessment of the witnesses who gave oral evidence was positive, in the sense that I formed the view that neither was deliberately giving false evidence. Both were telling the story, so far as they knew it, to the best of their ability. The demeanour of a witness in the witness box can be an uncertain guide to that witness’s honesty and reliability, but so far as could be told from their demeanour both appeared to be honest witnesses, doing their best to tell the truth. But they differed in their evidence on critical issues of fact. Where I found difficulty in accepting the evidence given by one or the other, this was on the basis that the preponderance of evidence or the balance of probabilities appeared to me to point in a certain way and not on the basis of any perceived lack of candour.

Circumstances leading up to the Indemnity Agreement

7. The basic outline of events leading up to these proceedings is not in dispute. The relevant part of the story begins with two companies established in 2007/2008 in the UAE in which both the Claimant and Mr Cameron were amongst several ultimate beneficial owners (“UBOs”).

8. These companies were Gulf Steel Strands FZE ( “GSS”), registered in the Jebel Ali Free Zone, and Odyssey Fasteners Manufacturing LLC (“Odyssey”), registered in onshore Dubai. GSS was a prestressed concrete steel strands (or PC strands) manufacturer, set up in 2007/2008 to meet the increasing demand for PC strands in the Middle East and North Africa (MENA) region. Odyssey, formerly known as Precision Fasteners LLC, was an export-led steel nail manufacturer, set up at about the same time as GSS

9. GSS and Odyssey both had a number of investors and UBOs including, in each case, the Claimant and Mr Cameron.

10. GSS had nine investors and UBOs. They comprised, in addition to the Claimant and Mr Cameron, Mr El Araj, Ali Al Sherif Al Emadi (“Mr Emadi”), Sheikh Mohammed Bin Suhaim Al Thani (“Sheikh Al Thani”), Mr Maroune Farah (“Mr Farah”), Stephen Gauci, Lorenzo Fachinelli and Arun Miranda. It is worth noting at this stage that Mr Emadi and Sheikh Al Thani both had a high profile. Sheikh Al Thani is a member of the ruling family of Qatar. Mr Emadi was at that time the Minister of Finance in Qatar, Chairman of QNB and on the board of Qatar’s sovereign wealth fund. Given the public nature of his positions Mr Emadi was at all times represented in respect of any GSS dealings by his brother, Khalid Shareef Al Emadi (“Mr Khalid”).

11. Odyssey had a total of four UBOs, comprising the Claimant, Mr Cameron, Mr El Araj and Mr Farah.

12. Mr Cameron and Mr Araj were both active to some extent in the business of GSS and Odyssey. In his Second Witness Statement, Mr Cameron explained that the day to day operations of the two companies were handled by a General Manager. Mr Cameron’s involvement was essentially in a supervisory or oversight role, assisting senior management on the operational side. Mr Cameron said, and I did not understand this to be challenged, that he ceased to be involved with Odyssey from around 2012 and with GSS from around 2018.

13. In or about August 2008, both GSS and Odyssey took out loans from HSBC Bank Middle East Limited (“HSBC”) under Facility Agreements. HSBC lent USD 52 million to GSS and USD 47 million to Odyssey (the “GSS Loan”, the “Odyssey Loan” and, together, the “HSBC Loans”). As part of the security for those loans, the UBOs of GSS and Odyssey respectively, including the claimant and Mr Cameron, each provided personal guarantees in favour of HSBC, in the form of All Moneys Guarantees, dated 3 June 2007 relating to GSS and 31 March 2008 relating to Odyssey (the “HSBC Personal Guarantees”).

14. Other security was also provided to HSBC, including a mortgage over land belonging to GSS in JAFZA, a mortgage over GSS’s and Odyssey’s plant and machinery, an assignment of contract proceeds and corporate guarantees from associated companies. In his Third Witness Statement, Mr Cameron valued this other security at about USD 37 million in respect of GSS and significantly more than that in respect of Odyssey; and he contended that this, along with the other personal guarantees, made his exposure very limited. His position on this is summarised in paragraph 13 of the Skeleton Argument filed on his behalf:

In his Witness Statement Mr Cameron confirmed this assessment of his position; because of the existence of the other personal guarantees given by each of the other UBOs of GSS and Odyssey and because HSBC had this other security, he regarded his exposure under the HSBC Personal Guarantee as relatively small. He maintained this position in cross-examination. I accept his evidence on this point. While he was potentially exposed to a claim by HSBC to the full extent of his personal guarantee, in reality he believed that he could take comfort from the existence of all the other security held by HSBC.

15. Both GSS and Odyssey defaulted on the HSBC Loans in about 2012 or 2013. Between them they owed HSBC not far short of USD 100 million.

16. Over the course of the next two or three years, led by the Claimant, GSS and Odyssey negotiated with HSBC on restructuring the HSBC Loans. The negotiations were carried out on behalf of the Claimant, GSS and Odyssey and the various UBOs by two financiers/ accountants, Mehdi Dazi (“Mr Mehdi Dazi”) and Manil Nedjar (“Mr Nedjar”), and to a lesser extent, Mr Dazi’s younger brother, Abdul Aziz Dazi (“Mr Abdul Dazi”).

17. So far as concerns the role of the Claimant, in paragraph 7g of his First Witness Statement, Mr Cameron puts the matter like this:

18. A similar account is given by Mr Cameron in paragraph 27 of his Second Witness Statement, where he says this:

19. A shorter and less detailed account is given in paragraph 3(g) of the Agreed Case Memorandum and list of issues prepared in advance of the trial. This reads as follows:

I have italicised wording inserted by Mr Cameron but not agreed by the Claimant. The text which is not italicised represents a position agreed between the parties.

20. It is apparent from these various accounts that it was the Claimant (possibly with Mr El Araj) who took the initiative in arranging the re-structuring of the finance. Mr Dazi was assisting him in this, possibly with the help of Mr Nedjar. An issue in this action is the relationship between Mr Dazi and the Claimant, said by Mr Cameron to be “a mutual friend and business associate” of the Claimant. But the starting point is that the restructuring of the finance was initiated by the Claimant and that he remained in that position throughout.

21. The result of these negotiations was that HSBC agreed to sell the HSBC Loans to two SPVs (set up for this purpose) for a total of USD 24 million and to release all the GSS and Odyssey UBOs from their HSBC Personal Guarantees. Why HSBC should agree to sell debts totalling nearly USD 100 million for a quarter of their value when it had in its hand personal guarantees and other security covering the indebtedness is a matter of speculation. It may be that – for whatever reason but possibly because, as noted above, two of personal guarantors, Mr Emadi and Sheikh Al Thani, were high profile individuals and any action against them would have caused embarrassment all round – HSBC simply had no appetite to take any action to enforce the personal guarantees or other security. Ultimately, however, HSBC’s motivation is irrelevant.

22. Details of the restructuring, so far as material, were as follows:

23. It is Mr Cameron’s contention, as set out in his Witness Statements, that, among the linked transactions intended to be put in place as part of this re-structuring and to help finance the QNB loan, asset purchase and leaseback arrangements would be entered into between each of the SPVs and GSS and Odyssey (each of whom was understood to own valuable assets); and further that, to secure GSS’s and Odyssey’s obligations under the equipment leases, the SPVs would have the benefit of share option purchases agreements granting them the right to purchase shares in GSS and Odyssey, as the case may be, for a nominal sum.

24. In due course, and as envisaged in the QNB Loan Agreement, EVL and GSS entered into an Asset Sale Agreement dated 5 April 2016 (the “Asset Sale Agreement”) in terms of which GSS’s assets were transferred to EVL. On 31 May 2016, EVL and GSS entered into an equipment lease (the “GSS Equipment Lease”) under which GSS agreed to rent the equipment from EVL. It was anticipated that the rent payable under the equipment leased to GSS would be used by EVL to repay the QNB loan.

The D2 Indemnity Agreement

25. During the negotiations with HSBC, most of the UBOs in GSS and Odyssey indicated that they wanted to exit the business. Mr El Araj and the Mr Cameron wished to remain involved. The Claimant intended to exit the business. Accordingly, he was not willing to take any unnecessary risk on the QNB Loan and he told Mr Araj and the Defendant that he required them to grant him an indemnity covering his entire liability thereunder. In his Second Witness Statement, at paragraph 37, Mr Cameron said that “because Mr Almheiri assumed the entire repayment responsibility for the transaction towards the lender (i.e. QNB), there needed to be a mechanism in place that would protect him. This only seems fair, and is where the D2 Agreement comes in.”

26. Mr Cameron provided an indemnity in the form of the Indemnity Agreement dated 26 August 2015 (the D2 Indemnity Agreement) covering the Claimant’s obligations to QNB under the QNB Loan.

27. A principal issue in this case revolves around what Mr Cameron was told during the period of financial re-structuring up until the time when he was asked to sign the D2 Indemnity Agreement. In paragraph 7j of his First Witness Statement, Mr Cameron says this:

This passage assumes that Mr El Araj did in fact enter into the D1 Indemnity Agreement but that is of no significance for present purposes. The important point here is Mr Camaron’s account of what he says he was told by Mr Dazi and, to a lesser extent, by Mr El Araj.

28. It appears from Mr El Araj’s Second Witness Statement, filed by him in support of his application contesting the jurisdiction of the DIFC Courts to hear and determine claims made against him by the Claimant, that Mr El Araj did sign an indemnity in the same terms (the “D1 Indemnity Agreement”). It was dated 25 August 2015 though Mr El Araj recalls that he received it by email from Mr Nedjar only on 26 August. The difference in the date is of no importance. What is important is Mr El Araj’s evidence in that Witness Statement that although he signed the D1 Indemnity Agreement, he never returned a signed copy either to Mr Nedjar or to the Claimant or to anyone acting on their behalf. His reasons for not returning a signed copy of the D1 Indemnity Agreement were summarised in paragraph 17 of Mr Cameron’s Skeleton Argument reflecting what was said by Mr El Araj in his Second Witness Statement:

As I have said, that account is consistent with what is said by Mr El Araj in paragraph 25 of his Second Witness Statement.

29. Mr Cameron’s Skeleton Argument goes on in paragraphs 18 and 19 to say this:

30. Mr El Araj goes on in paragraph 26 of his Second Witness Statement to make clear his complaint:

31. Mr Nedjar provided two Witness Statements in an earlier stage of these proceedings, at a time when Mr El Araj was (successfully) contesting the jurisdiction of this Court. He supported Mr El Araj’s account of events. In paragraph 14 of his first Witness Statement he confirmed that Mr El Araj never returned the signed D1 Indemnity Agreement. His explanation of what happened provides useful corroboration of Mr El Araj’s account and therefore that of Mr Cameron:

Mr Cameron’s account in his Second Witness Statement

32. It is worth at this stage quoting extensively from Mr Cameron’s Second Witness Statement to show the whole picture as he claims to have understood it to be:

The Security Cheque

33. I should mention that, as further protection for the QNB Loan, Mr Cameron also provided a Security Cheque in the amount of AED 92 million, the amount of the QNB Loan (the “Security Cheque”). According to the Claimant, the cheque was meant to have been payable directly to the Claimant but was in fact made payable to Mr Abdul Dazi. The Claimant’s case is that the cheque was signed by Mr Cameron on or after 28 January 2016, but this has not been established. It has never been cashed. It is said by the Claimant, and there appears to be some substance in this (though the cheque itself was not produced in evidence at the trial), that Mr Cameron has in some way regained control of the Security Cheque. Be that as it may, the claim in this action is a claim under the D2 Indemnity Agreement and only under that Indemnity Agreement. To that extent, the status of the Security Cheque is of little, in any, significance.

Default

34. Neither GSS nor Odyssey was able to service the QNB loan. GSS made no payments to EVL under the GSS Equipment Lease or at all. Odyssey fail to enter into an asset transfer agreement or an equipment lease with EVL. There were no other payments to EVL or ECL which could be used to service the QNB Loan. In October 2016 a creditor of GSS obtained an attachment order over GSS’s assets to secure a corporate guarantee provided by GSS as security for a personal debt of Mr El Araj. This also prevented EVL from exercising its option to purchase shares in GSS.

35. As a result of these failures on the part of GSS and Odyssey to pay EVL and ECL, the Claimant was not put in funds to repay the QNB Loan. In November 2016, EVL terminated the GSS Asset Lease Agreement and demanded payment of in excess of AED 54 million. QNB made a formal demand for repayment of the QNB Loan. In July 2019, the Claimant and QNB agreed that the amount due under the QNB Loan as at 23 May 2019 was USD 30,414,489.71. Subsequently, QNB commenced proceedings in Dubai against the Claimant. It is unnecessary to go into the details of that litigation, save to say that the Claimant’s liability under the QNB Loan is now established. He now seeks to recover from Mr Cameron. I do not need to go into the separate proceedings by the Claimant against Mr El Araj.

Mr Cameron’s Defence in these proceedings

36. As has already been noted, Mr Cameron does not deny that he signed the D2 Indemnity Agreement. Nor does he deny that, subject to certain points of detail, the D2 Indemnity Agreement answers to the claim arising out of the default by the Claimant in repayment of the QNB Loan. His position is that he is not liable under the D2 Indemnity Agreement because, as summarised in his Skeleton Argument:

I consider each of these points below.

(1) and (2): Deceit/ Mistake

37. The D2 Indemnity Agreement is governed by the law of Dubai and the Federal Laws of the UAE. It is subject to the exclusive jurisdiction of the DIFC Court.

38. Reference has to be made to the UAE Civil Code and to relevant decisions of the UAE and Dubai courts. Parties were agreed that I should adopt the “international approach” to determining questions of non-DIFC law. To this end, I heard submissions (rather than evidence) on UAE law and how it has been applied in the courts in onshore Dubai from counsel for each party, assisted in the case of the Claimant by Dr Mahmood Hussain, a practising UAE lawyer.

39. The UAE Civil Code is laid out in a number of Sections. Section 2 is concerned with the Elements, Validity and Effect of the Contract. This runs over a number of sub-headings starting with “(1) The making of the contract” at Article 129, which provides that the parties to the contract must agree upon the essential elements, through “(2) Agency in contracting” at Article 149, and “(3) The capacity to contract” at Article 157, to “(4) Defects in Consent” beginning at Article 176. The section on “Defects in Consent” is itself set out under a number of sub-headings, running from “(a) Duress” (at Article 176ff.), through “(b) Deception and Cheating” (at Article 185ff.), to “(c) Mistake” (at Article 193ff.). I was referred to Articles 185, 186, 187 and 190 which deal with misrepresentation and Articles, in the English translation which parties were prepared to agree, provide as follows:

40. The contention on behalf of Mr Cameron was that the D2 Indemnity Agreement was procured by deceit, alternatively by mistake. Conceptually, these points merge into one another and it is convenient to deal with them together.

41. Counsel for Mr Cameron based this part of their argument on the proposition, no doubt self-evident to any lawyer whether practising in the UAE or in any common law jurisdiction, that informed consent is a necessary element in contract formation. Informed consent was lacking here because of the following circumstances.

42. Dealing first with the question of deceit, counsel submitted that Mr Cameron was told by the Claimant in early 2014 that Mr Dazi would be managing the HSBC Loan restructuring.

43. Before signing the D2 Indemnity Agreement he was told by Mr Dazi and Mr El Araj that:

Each of these points had a particular significance in the context of the HSBC loan restructuring, as set out below.

[I should note here that although these matters are expressed above in terms of what would happen, they can without difficulty to re-phrased so as to amount to representations of fact, underpinning the agreement to enter into the contract, namely a representation that as a matter of fact it was the then intention, in the period leading up to the signing of the D2 Indemnity Agreement, that Mr Cameron (and Mr El Araj) would receive shares, that Mr Emadi would sign a similar agreement and that the loans would be repaid by equipment leases. No point was taken on this.]

44. As to (a), it was important that Mr Cameron would receive shares in ECL and EVL for three reasons: first, because it was intended that ECL and EVL would acquire assets from GSS and Odyssey having an insured value of more than USD 50 million; second, because it was intended that those companies, ECL and EVL, would be granted an option to purchase the shares of GSS and Odyssey for a nominal sum; and third, those companies, ECL and EVL, were intended to (and did in fact) acquire the HSBC Loans and so had the benefit of significant receivables, which debt was intended to be converted into equity in GSS and Odyssey, allowing the companies to attract new capital.

45. As to (b), it was important to Mr Cameron that Mr Emadi would sign a similar document because of Mr Emadi’s high profile mentioned above. That high profile had meant, in practice, that HSBC was reluctant to take action which might result in a public fallout with him; and his position in QNB and as chairman of Qatar’s sovereign wealth fund would have had the same deterrent effect in the event of a dispute about the QNB Loan.

46. Point (c) was important to Mr Cameron because it meant that the QNB Loan would be repaid without the necessity of any recourse to him.

47. This, it is said, was the basis upon which Mr Cameron agreed to be bound by the terms of the D2 Indemnity Agreement. Had he known that the facts and circumstances set out above were not true, he would not have signed it. As a matter of fact, that – or at least (a) and (b) above – also formed the basis upon which Mr El Araj agreed to be bound by the D1 Indemnity Agreement.

48. None of those representations were true. While Mr El Araj appears to have realised the truth in late August 2015, and in consequence did not return to the Claimant or to Mr Dazi or Mr Nedjar the signed copy of the D1 Indemnity Agreement, Mr Cameron only learned the truth in about November 2017. By this time, he had, of course, signed and returned the D2 Indemnity Agreement. It is on this basis that Mr Cameron now resists enforcement of the D2 Indemnity Agreement.

49. It was submitted on behalf of Mr Cameron that where, as here, one of the contracting parties (i.e. the Claimant) by words or representations made by him or by others on his behalf (and here the reference is to Mr Dazi acting on behalf of the Claimant) procures Mr Cameron's consent to something to which he would otherwise not have consented (i.e. entering into the D2 Indemnity Agreement), the aggrieved party (i.e. Mr Cameron) Is entitled to rescind or cancel the contract: UAE Civil Code, Article 187. The same applies where the representation is made by someone other than the contracting party (for example, Mr El Araj) and the other contracting party (the Claimant) knows of such misrepresentation: UAE Civil Code, Article 190.

50. It was submitted that the misrepresentations made to Mr Cameron by Mr Dazi and Mr El Araj were established on the evidence of Mr Cameron and corroborated by Mr El Araj and Mr Nedjar in witness statements placed before the court. Reliance was placed also upon the Claimant’s settlement with Mr Araj in which the D1 Indemnity Agreement is said to be “null and void ab initio”.

51. Even if it is not established that Mr Dazi was acting in the debt restructuring as agent for the Claimant, and/or it is established that for some other reason Mr Dazi’s representations do not bind the Claimant, it is argued that it is sufficient for Mr Cameron to show, even if only on balance of probabilities, that the Claimant had knowledge of them. It was the Claimant who introduced Mr Dazi to assist with the HSBC Loan Restructuring, and the Claimant in his witness statements concedes that Mr Dazi kept him updated at all times. Deliberate silence in relation to relevant circumstances known to be untrue constitutes deceit if the victim of the deceit would not have concluded the agreement had he known of the matter in question: UAE Civil Code, Article 186.

52. Turning to the argument based not on deceit but on mistake, counsel for Mr Cameron referred to Articles 194 and 195 of the UAE Civil Code. He submitted that under Article 194 a contract is void if there was a mistake of law and voidable if there was a mistake of fact, though it was not always possible to draw a clear line between the two situations. On the facts already set out, Mr Cameron signed the D2 Indemnity Agreement under the mistaken belief (a) that he would receive shares in ECL and EVL, (b) that Mr Emadi would be signing a similar Agreement and (c) that the HSBC Loans would be paid through the Equipment Leases: see above. None of this happened. On that basis, Mr Cameron was entitled to cancel the D2 Indemnity Agreement and did so.

53. In this chapter, concerning issues of deceit and mistake, the onus is clearly on Mr Cameron to make good his case on the facts. It is therefore appropriate to start by considering his evidence, set out above, as to what he was told or led to understand in relation to his agreement to enter into the D2 Indemnity Agreement. He was cross examined at some length under reference to those and other paragraphs in his witness statements. He was pressed on two issues in particular.

54. First, he was challenged on his assessment that by entering into the new arrangements, without any shares in ECL and EVL and without the security of a similar indemnity being signed by Mr Al Emadi, he would have been worse off than under the previous arrangements where he had signed a personal guarantee in favour of HSBC. Legally, of course, he was potentially exposed under the HSBC Personal Guarantee for nearly USD 100 million. To that extent, the cross-examination was well founded. But that is not the whole story. What matters for present purposes is not the potential legal liability to which Mr Cameron was exposed under the HSBC Personal Guarantee but rather Mr Cameron’s practical exposure to HSBC or, more precisely, Mr Cameron’s own assessment of that exposure. While recognising the extent of his obligations under the HSBC Personal Guarantee, he took comfort in the various factors mentioned above: the assets held by the Bank as security; the personal guarantees given by others in respect of the same borrowing; and, perhaps most important of all, the involvement of Sheikh El Thani and Mr Al Emadi , which, for reasons already explained, gave him cause to believe that the Bank would be unlikely to enforce the personal guarantees against any of the guarantors. I am satisfied, having heard Mr Cameron on this point, that his assessment that his exposure under the HSBC Personal Guarantee was, in practice, relatively small was both genuine and not unreasonable. In those circumstances, I accept his evidence that he would not have wanted to enter into guarantees in respect of the new arrangements with QNB, such as the D2 Indemnity Agreement, unless his exposure was in practice similarly restricted.

55. The second line of cross-examination related to the question whether any representations on the basis of which Mr Cameron acted came from the Claimant. This question requires to be refined. It is not Mr Cameron’s case that he now recalls the Claimant himself telling him that Mr Emadi would sign a guarantee or indemnity in the same form as the D1 or D2 Indemnity Agreements: see e.g. paragraph 34 of Mr Cameron’s Third Witness Statement. Mr Cameron’s case is that the Claimant was represented throughout the course of the restructuring by Mr Dazi and that it was Mr Dazi who made it clear to him that Mr Emadi would be signing a similar form of document: ibid paragraphs 34 and 35. It may be that Mr El Araj contributed to this understanding by passing on what he understood from Mr Dazi, but that does not matter for present purposes. I accept that Mr Dazi made a representation to this effect during the course of the restructuring process, and indeed that that formed the basis for Mr Cameron’s (and probably Mr El Araj’s) understanding of what was intended to happen. There is no doubt to my mind that that representation – that the new arrangements to which Mr Cameron (and Mr El Araj) were to be party included the giving of an Indemnity by Mr Emadi in the same terms as the D1 and D2 Indemnity Agreements – was a material factor in persuading Mr Cameron to sign the D2 Indemnity Agreement. I accept Mr Cameron’s case that he would not have agreed to the re-structuring in those terms unless he had been assured that Mr Emadi would sign an Indemnity Agreement in similar terms. There is no doubt also that that representation was false.

56. That is not to say that the Claimant knew that a false representation was being made. But that is not the question. The question is whether the Claimant can nonetheless be held to it as though it had come from him. I am in no doubt that he can be held to that false representation. He instructed Mr Dazi in matters relating to the re-structuring of the loan agreements. As far as Mr Cameron (and presumably Mr El Araj) were concerned what Mr Dazi told them about the proposed arrangements would have represented the Claimant’s own understanding of the position. Put another way, the Claimant put Mr Dazi in a position of speaking for him in relation to the re-structuring of the loan agreements. The false representation made by Mr Dazi can be treated as though made by the Claimant.

57. I should add that in coming to these conclusions I have taken account of statements made by Mr El Araj and Mr Nedjar. The makers of those statements were not called to give evidence and therefore their evidence was not subject to cross-examination. Their evidence should therefore be treated with caution, but it is not necessary to discount it altogether. Their evidence is broadly supportive of Mr Cameron’s evidence and it strengthens Mr Cameron’s case. But I am mainly influenced by Mr Cameron’s evidence itself. Having heard him under cross-examination I am persuaded that his account is essentially true. Where his version of events differs from that given by the Claimant, I prefer Mr Cameron’s account.

58. I have focused on the representation as to what was intended regarding the giving of an indemnity by Mr Emadi. But the same applies to the understanding shared by Mr Cameron and Mr El Araj as to (a) the proposed shareholding in ECL and EVL and (b) the equipment leases, all as spoken to by Mr Cameron in those paragraphs of his Second Witness Statement quoted above.

59. On behalf of the Claimant, it was argued that if there might otherwise be a defence to the claim based on misrepresentation, whether fraudulent or negligent, that defence was not available in circumstances where the D2 Indemnity Agreement contains, as it does here, an “entire agreement” clause.

60. The clause in question is clause 17 which provides as follows:

61. On behalf of the Claimant, it was submitted that while under the common law it might be arguable that an entire agreement clause such as this did not apply to exclude reliance on a misrepresentation inducing the contract, and thereby negativing consent – and I was referred to English authorities on the point – the position under UAE Law was different. I was referred to the decision of the DIFC Court in Mason v Madison [2021] DIFC CFI 073 at paragraphs 23-26, where it was held that an entire agreement clause – or “merger clause” as it referred to in DIFC Law No. 6 of 2004 (the “Contract Law”) – was effective to exclude prior statements as to the origin of the goods. But quite apart from the fact that that case was decided under DIFC Law, not under the UAE Civil Code (as to which I was given no assistance), that case is concerned with an entirely different issue. What was sought to be done there was to use a prior statement to supplement or modify the terms of the contract, whereas in the present case the question is whether the clause can be relied on to prevent reliance on prior representations which, if established, go directly to the issue of consent. I do not consider that the clause prevents Mr Cameron from relying on what he was told about the whole circumstances in which he was being asked to sign the D2 Indemnity Agreement and saying, as he does, that if he had not been misled as to those circumstances, he would not have signed the Agreement. The misrepresentation goes to the heart of the consent issue, and reliance on it is not excluded by the terms of the Entire Agreement clause.

62. Accordingly, I reject the Claimant’s arguments based on the Entire Agreement clause. It is arguable that on its proper construction the first sentence of the clause only relates to previous warranties, statements, etc, “relating to its subject matter”, i.e. relating to the subject matter of the Agreement, and therefore having no application to statements affecting the underlying issue of consent, but I prefer to base my decision on the broader ground set out above. It makes no difference that, as was pointed out in submissions, the second half of the clause is a “no reliance” clause stating that neither party has relied upon any statement etc made by another party except as is expressly set out in the agreement – the principle is the same.

63. In those circumstances, I uphold Mr Cameron’s defence to the claim based on misrepresentation: Articles 185-187 of the UAE Civil Code. The Claimant’s claim fails.

64. It is not strictly necessary for me to deal in any detail with the other defences run on behalf of Mr Cameron. But I consider them briefly in case this matter goes further.

(3): Discharge by reason of settlement with Mr El Araj

65. It was argued on behalf of Mr Cameron that he was discharged from any liability under the D2 Indemnity Agreement by virtue of the settlement between the Claimant and Mr El Araj. There is nothing in this point. The argument depends on Mr Cameron and Mr El Araj being joint debtors, or to use the common law expression, their liability to the Claimant being joint and several. But they are not joint debtors. They are (subject to other points dealt with in this judgment) each separately liable to the Claimant under separate Indemnity Agreements. Settlement of the claim against one of them under one Indemnity Agreement cannot possibly affect the liability of the other under the Indemnity Agreement to which he is a party.

(4): The D2 Indemnity Agreement is a Guarantee and the Claimant’s claim under it is time-barred

66. It was common ground, as I understood it, that the concept of an “indemnity”, as understood in the common law system, does not have a direct equivalent in UAE law. Agreements such as the D2 Indemnity Agreement involving compensation or reimbursement are classified under UAE Law as either “nominate” or “innominate”. On behalf of Mr Cameron, it was argued that the D2 Indemnity Agreement, although called an “Indemnity Agreement”, was as a matter of substance a nominate contract, i.e. a guarantee. For the Claimant it was argued that the indemnity was in fact an innominate agreement. I prefer the latter argument, which was advanced by Dr Mahmoud Hussain on behalf of the Claimant. But I am not sure that that point is decisive either way.

67. Mr Cameron’s argument, as set out in his Skeleton Argument, is as follows. Although the Claimant is named as the borrower in the QNB Loan, the loan proceeds were payable to EVL, to enable EVL to acquire the GSS assets which were in turn intended to be leased back to GSS in return for payment of certain lease fees, the whole scheme being one “transaction”. The D2 Indemnity Agreement was put in place to support that transaction, with Mr Cameron, Mr El Araj and Mr Emadi securing repayment of the loan (to be serviced by EVL, as the principal debtor) towards the Claimant (as the borrower on record). That is a guarantee as explained by the Dubai Court of Cassation in Case No. 202/2008. According to Article 1092 of the UAE Civil Code, a creditor (i.e. the Claimant) must make a claim under a guarantee within six months from the date when the obligation to pay falls due. It has been held in a number of cases decided by the Dubai Court of Cassation that Article 1092 of the UAE Civil Code applies to both personal and commercial guarantees: see e.g. Dubai Court of Cassation Cases Nos. 2000/168 and 2008/202. In this case the obligation fell due at latest in March 2019, when QNB notified the Claimant of an “Event of Default”. The claim in this action was not brought until the end of May 2021. More than two years later. Accordingly, the Claimant’s claim is time-barred.

68. The Claimant joins issue with this analysis, for three main reasons. The first is that the UAE Courts have confirmed that Article 1092 of the UAE Civil Code does not apply to a commercial debt: Dubai Court of Cassation in commercial Appeal No. 30 of 2025, under reference to Article 70 of the Federal Decree-Law No. 50/2022 on the Promulgation of the Commercial Transactions Law Commercial Code (the “Commercial Code”). In rejecting an argument that the appellant was discharged from its suretyship on the basis that the time under Article 1092 had expired, the Court ruled that a commercial suretyship was governed by the Commercial Code and therefore the six month time limit did not apply. The second reason is that in any event Article 1092 only applies to situations where the creditor has the benefit of a guarantee in addition to a direct right of action against the debtor and does not apply where, as here, the obligations arose under two distinct contracts, the QNB Loan and the D2 Indemnity Agreement. The third reason is that Article 1092 only applies where there is no other express agreement – here Article 2.3 the D2 Indemnity Agreement (“Obligation to Make Payment upon Demand”) allows a demand to be made “... at any time after the occurrence of an Indemnity Event”, thereby overriding any statutory time limit that would otherwise apply.

69. I can deal with the point quite shortly. I am not persuaded by the third argument advanced by the Claimant. That argument, if correct, would mean that there would, in practice, be no time-bar applicable in a very large number of cases. Nor am I persuaded that the second argument provides the answer. But the first point advanced by the Claimant appears to me to be conclusive in his favour. The recent decision of the Dubai Court of Cassation appears to me to show that Article 1092 does not apply to a commercial transaction such as this.

70. Accordingly, I reject the time-bar defence advanced by Mr Cameron.

(5) In any case the Claimant is only entitled to recover one third of what he has actually paid to QNB and been unable to recover

71. As I understood this argument it seemed to proceed upon the assumption that there were three debtors (Mr Cameron, Mr El Araj and Mr Emadi) jointly and severally liable to the Claimant. By not procuring an Indemnity Agreement with Mr Emadi, and by later releasing Mr El Araj from his liabilities under the D1 Indemnity Agreement, the Claimant has deprived Mr Cameron of his rights of subrogation against Mr Emadi and Mr El Araj, as a result of which he should only be held liable to the Claimant, if at all, for one third of the Claimant’s loss.

72. As I have said, this argument appears to proceed upon the basis that the three of them were jointly and severally liable to the Claimant. But they were not. The two Indemnity Agreements were separate agreements, and had Mr Emadi signed a similar agreement that too would have been a separate agreement. There is no question of any joint and several liability and therefore no question of Mr Cameron having (and then being deprived of) any subrogated rights against Mr Emadi and Mr El Araj.

73. I reject this argument.

(6) The Claimant failed in his duty to mitigate, extinguishing any loss altogether

74. The duty to mitigate is alleged to arise from the duty to act in good faith. While I could see the possibility of an argument based on some action which the Claimant could or should have taken to reduce his exposure under the QNB Loan, that is not what is alleged. The argument advanced is (a) that the Claimant should have pursued Mr El Araj more diligently, and (b) that he should not have transferred certain of his assets to the sister of Mr El Araj and to Mr Nedjar. Neither assertion is relevant to an argument on mitigation.

75. I reject this argument too.

Conclusion/ Disposal

76. For the reasons set out above, the Claimant’s Claim fails and is dismissed.

77. Both sides asked for their costs. I see no reason why costs should not follow success. Nor is there any reason to depart from the standard basis for assessment. Accordingly, I order that the Claimant shall pay Mr Cameron his costs of this action to be assessed by the Registrar on the standard basis if not otherwise agreed.