March 21, 2022 CONSULTATIONS
1. This is public consultation on the proposed addition of Part 58 to the Rules of the DIFC Courts (“RDC”) concerning the Digital Economy Court.
2. The DIFC Courts Registrar seeks public comments on the proposed draft Part 58 Rules (“Draft P58 Rules”).
3. The Registrar would be grateful if practitioners would please first read the “Statement of Substance and Purpose and Summary of Draft Rules” before reading the Draft P58 Rules.
4. The Draft P58 Rules will, amongst other things:
(a) introduce the Digital Economy Court (“DEC”);
(b) detail which claims qualify for registration in the DEC;
(c) set out how claims are to be filed in the DEC (including “Fast DEC” claims);
(d) illustrate how service of a DEC claim is to be effected;
(e) illustrate the procedure for document production for DEC cases; and
(f) briefly set out the appeal process with respect to DEC claims.
5. Comments on the Draft P58 Rules should be made by 4:00 pm on 20 April 2022 and sent to:
58.1 This Part applies to claims in the Digital Economy Court (“DEC Claims”).
58.2 The Rules of the DIFC Courts and their Practice Directions, Registrar’s Directions and Practical Guidance Notes apply to DEC Claims unless this Part or a Practice Direction provides otherwise.
The Digital Economy Court
58.3 The Digital Economy Court is a specialist division of the DIFC Courts.
58.4 A Judge will be appointed to be the Judge in charge of the Digital Economy Court.
Digital Economy Claims
58.5 In this Part:
(1) a “DEC Claim” means a claim which:
(a) satisfies the requirements of Rule 58.7; and
(b) has been issued in or transferred into the Digital Economy Court;
(2) a “Fast DEC Claim” means a DEC Claim:
(a) whose value or subject matter does not exceed AED 100,000; or
(b) whose value exceeds AED 100,000, but the parties have consented to the claim being determined under the Fast DEC Claim procedure in Rules 58.57 to 58.91; and
(3) a “digital asset” includes a cryptoasset, digital token, smart contract or other digital or coded representation of an asset or transaction.
58.6 The Chief Justice may by Practice Direction vary the financial limits in Rule 58.5(2).
58.7 A claim may be brought as a “DEC Claim” if it involves issues relating to the digital economy. The following is a non-exhaustive list of claims that are suitable for the Digital Economy Court:
(1) claims involving digital assets, including the digital environment, platform or system in which a digital asset exists or may exist;
(2) claims relating to blockchains;
(3) claims involving substantial or complex databases;
(4) claims relating to artificial intelligence and any devices or components of devices whether integrated or not that are dependent on or controlled by artificial intelligence;
(5) claims involving data stored digitally including on cloud or other remote platforms, including distributed ledger technology;
(6) claims involving e-commerce, online intermediaries, digital payment platforms or marketplaces;
(7) claims relating to automatic dispute resolution processes;
(8) claims relating to digital peer-to-peer transactions;
(9) intellectual property claims arising out of or in relation to any of the above claims;
(10) insurance claims in relation to any of the above claims; and
(11) any combination of the above claims.
Duty to conduct proceedings digitally
58.8 The Court shall, as far as possible, conduct DEC Claims making appropriate use of information technology and with a view to reducing the environmental impact of court proceedings.
58.9 The parties are required to help the Court to conduct proceedings in accordance with Rule 58.8.
Powers in relation to digital assets
58.10 The Court may at any time make an order authorising and directing the Registrar, a judicial officer or any other person to operate, modify, sign or cancel any digital asset using any digital signature, cryptographic key, password or other digital access or control mechanism available to it.
58.11 The Court may operate an electronic dynamic system for DEC Claims by which the parties provide information through smart forms, or artificial intelligence driven forms, based on decision-tree software that procure necessary information for the conduct and disposal of the claim.
58.12 A Practice Direction or Practical Guidance Note may make further provision for the operation of such an electronic dynamic system.
Issuing a DEC Claim
58.13 A DEC Claim may be commenced using the procedure in Part 7 or Part 8 .
58.14 The claim form, statements of case and all other Court documents must be marked “Digital Economy Court”.
58.15 A claimant may issue an application in the Digital Economy Court before issuing a DEC Claim, but the claimant must:
(1) at the same time apply for a determination that the claim is suitable to be issued in the DEC Claim; and
(2) file written evidence explaining why the proposed claim is suitable to be issued in the Digital Economy Court.
58.16 The claim form must be served in accordance with Part 9.
58.17 Where the Court orders service of the claim form by an alternative method under Rules 9.31 to 9.33, the Court may authorise service by any physical or electronic method which is likely to bring the claim form to the attention of the recipient, including:
(1) by email;
(2) by a digital messaging service;
(3) by social media; or
(4) by any other electronic means which creates written evidence of transmission.
58.18 Each party must supply the Court and all other parties with at least one email address (a “nominated email address”) to which documents relating to the DEC claim may be sent.
58.19 A claimant must supply a nominated email address in the claim form.
58.20 A defendant must supply a nominated email address as soon as reasonably practicable and in any event in the acknowledgment of service.
58.21 Any party joined to a DEC Claim must supply a nominated email address as soon as reasonably practicable after receipt of the claim form and order joining the party.
58.22 A party’s nominated email address may belong to a legal representative.
58.23 A party may supply more than one nominated email address.
58.24 A party wishing to change a nominated email address must give the Court and all other parties notice in writing of the new nominated email address.
58.25 Unless the Court orders otherwise, all documents in the claim other than the claim form must be served by email sent to a party’s nominated email address.
58.26 All documents sent to a party’s nominated email address will be considered served on that party at the date and time on which the email was sent.
Transfer of proceedings
58.27 The Court may order proceedings to be transferred to or from the Digital Economy Court.
58.28 Where the Court orders proceedings to be transferred, it will give notice of that transfer to all parties.
58.29 Part 26 (Case Management) applies to DEC Claims, save that Court will fix a Case Management Conference within 14 days of the earlier of these events:
(1) the filing of particulars of claim; or
(2) the date of an order transferring the claim to the Digital Economy Court.
58.30 The parties must prepare and file a list of issues not less than 2 weeks before the date fixed for the Case Management Conference.
58.31 The list of issues should briefly identify the main issues of fact and law in a structured manner.
58.32 The list of issues is intended to be a neutral document for use as a case management tool and neither party should attempt to draft the list in terms which advances one party’s case over that of another.
58.33 In addition to the matters listed in Rule 26.35, at any Case Management Conference in a DEC Claim the Court will also consider the following:
(1) whether the claim is suitable for the Digital Economy Court;
(2) whether any non-parties have an interest in the subject matter of the dispute and should be joined to the DEC Claim including, in relation to digital assets, any person who has digitally signed that asset or who claims to own or control it through possession or knowledge of a digital key;
(3) whether any directions are required for production of digital data under Part 28;
(4) whether any directions are required for a technology assisted or artificial intelligence assisted review of documents;
(5) whether any directions are required to facilitate the presentation of digital data, models or other digital information to the Court, including by making such material available to the Court in a digital or other native format;
(6) whether any issues in the claim are capable of determination without a hearing; and
(7) whether the Court should sit with assessors instead of, or in addition to, granting permission for expert evidence under Rule 31.13.
Party Nominated Assessors
58.34 The Court may of its own motion consider whether the case is appropriate for the appointment of assessors (Rules 31.70 – 31.77) and may make such recommendations to the parties in that regard as it sees fit.
58.35 Where the Court appoints assessors, the general rule is that the Court will appoint two assessors, one nominated by the claimant(s) and one nominated by the defendant(s).
58.36 Any application for the appointment of party nominated assessors should be made at or before the first Case Management Conference.
Applications in DEC Claims
58.37 Where an application is a heavy application (see Rule 23.44) the timetable in Rule 23.46 will not apply and instead:
(1) evidence in support must be filed and served with the application;
(2) evidence in answer must be filed and served within 21 days thereafter;
(3) evidence in reply (if any) must be filed and served within 10 days of service of any evidence in answer.
58.38 The Court will expect to list a heavy application for a hearing within two months of service of evidence in answer.
58.39 All parties must give Initial Production of documents by no later than 2 weeks before the date fixed for the first Case Management Conference.
58.40 Initial Production means that a party must produce to all other parties copies of:
(1) the key documents on which it relies in support of the claims or defences advanced in its statement of case (including the documents referred to in that statement of case); and
(2) the key documents that are necessary to enable the other parties to understand the claim or defence they have to meet.
58.41 At the Case Management Conference, the Court will consider what document production orders to make. The Court may make any order as to the manner in which the parties are to produce documents as it considers appropriate. Generally, the Court will order either:
(1) Model A (Known adverse documents only);
(2) Model B (Limited document production);
(3) Model C (Request led production)
58.42 The Court may order that a different model of document production be used for different issues in the case by reference to the list of issues prepared in accordance with Rule 58.30.
58.43 Where Model A is ordered a party is required to produce only known adverse documents.
58.44 A known adverse document is a document which:
(1) a party is actually aware is or was previously within its possession or control (without undertaking any further searches for documents than it has already undertaken or caused to be undertaken);
(2) is adverse.
58.45 A document is adverse if it or any information it contains contradicts or materially damages the producing party’s contention or version of events on an issue in dispute, or supports the contention or version of events of an opposing party on an issue in dispute.
58.46 Where Model B is ordered, a party is required to produce in addition to known adverse documents to the extent that they have not already done so by way of Initial Production:
(1) documents on which they rely in support of the claims or defences advanced in their statement(s) of case; and
(2) any further documents that are necessary to enable the other parties to understand the claim or defence they have to meet.
58.47 Where Model A or B is ordered, a party is not required to undertake any search for adverse documents.
58.48 Where Model C is ordered, the parties shall, in addition to producing known adverse documents, produce documents according to requests as provided for in Rules 28.15 to 28.27. A party must also produce any adverse documents discovered when carrying out searches in order to comply with requests.
58.49 Whichever model of production is ordered if, at any time after an order for document production has been made, a party becomes aware of an adverse document in its possession or control, it must produce that document to the other parties.
58.50 A party is not required to produce in Initial Production or under Model A, B or C any documents which it has previously produced in pre-action correspondence or in the course of the proceedings.
58.51 A party’s obligations to produce documents in DEC claims remain subject to Rules 28.20 to 28.30 (grounds for excluding documents from production).
Trial Witness Statements
58.52 Parties are expected to limit the contents of trial witness statements. Many matters of fact do not require witness evidence either because they are common ground or because witness testimony adds nothing of substance to the documents. The fact that there is or may be an issue concerning what a document means or shows does not, without more, mean that witness evidence is required.
58.53 A trial witness statement must contain only:
(1) evidence as to matters of fact that need to be proved at trial by the evidence of witnesses in relation to one or more of the issues of fact to be decided at trial, and
(2) the evidence as to such matters that the witness would be asked by the relevant party to give, and the witness would be allowed to give, in evidence in chief if they were called to give oral evidence at trial and Rule 29.42 did not apply.
(Rule 29.42 provides that where a witness is called to give oral evidence at trial, their witness statement shall stand as their evidence in chief unless the court orders otherwise.)
58.54 A trial witness statement must set out only matters of fact of which the witness has personal knowledge that are relevant to the case, and must identify by list what documents, if any, the witness has referred to or been referred to for the purpose of providing the evidence set out in their trial witness statement. The requirement to identify documents the witness has referred to or been referred to does not affect any privilege that may exist in relation to any of those documents.
58.55 The Court may:
(1) on application or its own motion strike out or all part of a witness statement that does not comply with Rule 58.53 or direct that a witness statement be redrafted; and
(2) take into account when determining costs the extent to which a party’s witness statements address matters that did not need to be the subject of witness evidence.
58.56 Unless the Court orders otherwise, all hearings will take place remotely with electronic hearing bundles or other digital presentation of material.
58.57 Rules 58.57 to 58.91 set out a special procedure for dealing with Fast DEC Claims. It is primarily, but not exclusively, intended for consumer disputes arising from e-commerce transactions, digital payment platforms or marketplaces
58.58 Fast DEC Claims will be case managed and determined by such Judges, or judicial officers (including the Registrar and Assistant Registrars) as the Chief Justice directs.
58.59 Unless the Court orders otherwise, only the following Parts of the RDC apply to Fast DEC Claims:
(1) Parts 1 to 5;
(2) Rules 29.9 to 29.11 (Evidence — power to control evidence);
(3) Part 36 (judgments and orders); and
(4) Parts 44 to 52.
58.60 Where a claimant issues multiple claims against the same defendant, the Court may treat those claims as a single claim under Rule 4.2(7) for the purposes of deciding whether the amount in dispute exceeds the financial limit in Rule 58.5(2)(a).
58.61 Unless the Court orders otherwise, Fast DEC Claims shall be conducted in private and judgments will be anonymised before publication.
58.62 All documents in a Fast DEC Claim, including a claim form, may be served by any means reasonably likely to bring it to the attention of the party being served.
Commencement of proceedings
58.63 A Fast DEC Claim is commenced by issuing a Fast DEC Claim Form.
58.64 The Fast DEC Claim Form must:
(1) state the claim against the defendant;
(2) state the monetary value of the claim;
(3) state the basis for the DIFC Court’s jurisdiction; and
(4) contain or attach all the evidence, legal submission and other materials on which the claimant relies in support of the claim.
58.65The Claimant must supply in the Fast DEC Claim Form an email address for the defendant or, if an email address is unavailable, an address or other contact details to which document can be sent physically or electronically.
58.66 Upon the claimant’s filing of the Fast DEC Claim, the Court will serve the Fast DEC Claim Form and its supporting material on the defendant, unless the Court directs otherwise.
Responding to proceedings
58.67 Within 21 days of service of the Fast DEC Claim Form, the defendant must file and serve a Fast DEC Defence.
58.68 The Fast DEC Defence must:
(1) state any objections to the jurisdiction of the DIFC Court
(2) state any objections to the use of the Fast DEC Claim procedure;
(3) state the defence to the Fast DEC Claim;
(4) state any counterclaim which the defendant has against the claimant; and
(5) contain or attach all the evidence, legal submission and other materials on which the defendant relies in support of its jurisdictional objections and defence.
58.69 The Court must transfer the claim under Rule 58.78 to the Digital Economy Court if:
(1) the defendant makes a counterclaim whose value is greater than the financial limit in Rule 58.5(2)(a); and
(2) the claimant does not consent to the counterclaim being determined under the Fast DEC Claim procedure.
58.70 Within 21 days of service of the Fast DEC Defence, the claimant may file and serve a Fast DEC Reply.
58.71 A Fast DEC Reply may:
(1) answer any objections to the jurisdiction of the DIFC Court contained in the Fast DEC Defence;
(2) answer any objections to the use of the Fast DEC Claim procedure;
(3) answer the defence to the Fast DEC Claim;
(4) state any objections to the jurisdiction of the DIFC Court to determine the counterclaim;
(5) state any defence to any counterclaim and
(6) contain or attach any further evidence, legal submission or other materials on which the claimant relies in support of the claim or answer to the counterclaim.
58.72 Within 14 days of service of the Fast DEC Reply, the defendant may file and serve a Fast DEC Rejoinder.
58.73 A Fast DEC Rejoinder may:
(1) answer any objections to the jurisdiction of the DIFC Court to determine the counterclaim;
(2) answer any defence to any counterclaim; and
(3) contain or attach any further evidence, legal submission or other materials on which the defendant relies in support of the counterclaim.
58.74 A defendant who does not dispute the DIFC Court’s jurisdiction in the Fast DEC Defence will be taken to have accepted the Court’s jurisdiction to determine the claim.
58.75 A claimant who does not dispute the DIFC Court’s jurisdiction in the Fast DEC Reply will be taken to have accepted the Court’s jurisdiction to determine the counterclaim.
58.76 A party who objects to the Court’s jurisdiction to decide a claim or counterclaim shall not be taken to have accepted the Court’s jurisdiction simply because they also defend the substance of the claim or counterclaim.
Management of proceedings
58.77 The Court may at any time give any directions required to determine the Fast DEC Claim.
58.78 The Court may at any time order a Fast DEC Claim transferred to the Digital Economy Court if it considers the claim is unsuitable for the Fast DEC Claim procedure. The Court may make such an order notwithstanding that the parties have consented to the claim being determined under the Fast DEC Claim procedure.
58.79 The Court will generally determine the Fast DEC Claim without a hearing and, unless the Court orders otherwise, within three months of service of the Fast DEC Claim. The Court will give short reasons for its decision.
58.80 If no Fast DEC Defence is filed, the Court must not enter judgment against a defendant on a Fast DEC Claim, unless it is satisfied that:
(1) the Fast DEC Claim Form has been served in accordance with Rule 58.62; and
(2) the DIFC Courts have jurisdiction over the claim.
58.81 If no Fast DEC Reply is filed, the Court must not enter judgment against a claimant on a counterclaim unless it is satisfied that the DIFC Courts have jurisdiction over the counterclaim.
58.82 The Court will list a hearing if it considers that the claim cannot be fairly disposed of without a hearing. Any hearing will not last longer than two hours. If the Court considers that a longer hearing may be required, it may transfer the claim under Rule 58.78 to the Digital Economy Court.
58.83 At any hearing:
(1) the Court may adopt any method of proceeding that it considers fair;
(2) hearings will be informal; and
(3) the Court need not take evidence on oath.
58.84 The strict rules of evidence do not apply in the determination of a Fast DEC Claim.
58.85 When it determines the Fast DEC Claim, the Court will make a costs order requiring the unsuccessful party to pay any court fees paid by the successful party.
58.86 The Court shall not order any party to pay the legal costs of any other party.
58.87 An order on a Fast DEC Claim shall have the same status as an order of the DEC Court and may be enforced in accordance with the rules and procedures set out in RDC Parts 45–50.
58.88 Applications for the enforcement of an order on a Fast DEC Claim should be made to the DEC Court.
Appeals in Fast DEC Claims
58.89 An appeal from a final judgment in a Fast DEC Claim lies to the Digital Economy Court. An appeal must be made in accordance with Part 44, save that Rules 44.117 – 44.119 do not apply.
58.90 The Digital Economy Court will allow an appeal from a judgment in a Fast DEC Claim only where the decision was:
(1) wrong in law; or
(2) unjust because of a serious procedural or other irregularity.
58.91 No appeal lies from a decision of the Digital Economy Court hearing an appeal in a Fast DEC Claim.