May 15, 2023 SCT - JUDGMENTS AND ORDERS
Claim No: SCT 455/2022
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE SMALL CLAIMS TRIBUNAL
ORDER OF SCT JUDGE DELVIN SUMO
UPON this claim having been called for a Consultation before SCT Judge Delvin Sumo on 11 May 2023
AND UPON the Claimant’s representative attending the Consultation and the Defendant failing to appear although served notice of the claim
IT IS HEREBY ORDERED THAT:
1. This Claim be dismissed due to lack of jurisdiction.
2. Each party shall bear their own costs.
SCT Judge and Assistant Registrar
Date of Issue: 15 May 2023
SCHEDULE OF REASONS
1. The Claimant is Murin, a company located in DIFC, Dubai, the UAE (the “Claimant”).
2. The Defendant is Mola, a company located in Dubai, the UAE (the “Defendant”).
3. On 14 December 2022, the Claimant filed a claim with the DIFC Courts’ Small Claims Tribunal (the “SCT”) seeking an order that the Defendant comply and fulfil the works as set out in paragraph 1.1 of the Settlement Agreement dated 23 June 2019 (the “Settlement Agreement”).
4. On 11 May 2023, a consultation was listed before me at which the Claimant’s representative attended, and the Defendant failed to appear, although served notice of Claim (the “Consultation”).
Can the DIFC Courts hear and determine this Claim?
5. Rule 53.2 of the Rules of the DIFC Courts (the “RDC”) requires that the SCT hear only cases that fall “within the jurisdiction of the DIFC Courts”. The jurisdiction of the DIFC Courts is determined by Article 5(A) of the Judicial Authority Law, Dubai Law No. 12 of 2004, as amended (the “JAL”), which provides a number of limited gateways through which the DIFC Courts have jurisdiction over a claim, which are, as relevant:
“(a) Civil or commercial claims and actions to which the DIFC or any DIFC Body, DIFC Establishment or Licensed DIFC Establishment is a party;
(b) Civil or commercial claims and actions arising out of or relating to a contract or promised contract, whether partly or wholly concluded, finalised or performed within DIFC or will be performed or is supposed to be performed within DIFC pursuant to express or implied terms stipulated in the contract;
(c) Civil or commercial claims and actions arising out of or relating to any incident or transaction which has been wholly or partly performed within DIFC and is related to DIFC activities; …
(e) Any claim or action over which the Courts have jurisdiction in accordance with DIFC Laws and DIFC Regulations…
(2) …civil or commercial claims or actions where the parties agree in writing to file such claim or action with [the DIFC Courts] whether before or after the dispute arises, provided that such agreement is made pursuant to specific, clear and express provisions.”
6. The jurisdiction clause 13.2 set out in the Settlement Agreement is as below:
“Any disputes, controversy, or claim arising out of or in connection with this Agreement, including any question regarding its existence, validity, or termination, shall be finally resolved by arbitration under the Arbitration Rules of the DIFC-LCIA Arbitration Centre in force at the date hereof, which Rules are deemed to be incorporated by reference into this clause. The Tribunal shall consist of a sole arbitrator. The place and seat of arbitration shall be the Dubai International Financial Centre. The language of the arbitration shall be English.”
7. Upon review of the case file and the submissions contained therein, it is clear that the Claimant is a company registered within the DIFC, and, therefore, would satisfy the jurisdictional gateway requirements of Article 5(A)(a) of the JAL. However, since the parties entered into a Settlement Agreement, I must consider the contractual arrangement between the parties and determine whether the Settlement Agreement provides for an alternative form of dispute resolution between the parties.
8. The jurisdiction clause mentioned in paragraph 7 above clearly refers to arbitration which the parties have agreed to resolve their disputes, therefore, I am of the view that the DIFC Courts do not have jurisdiction to hear and determine this Claim and as such, the Claimant ought to have resorted to arbitration instead.
9. Accordingly, for the reasons I have set out above, I find that the DIFC Courts do not have jurisdiction to hear and determine this Claim.