December 26, 2022 SCT - Judgments and Orders
Claim No. SCT 393/2022
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
In the name of His Highness Sheikh Mohammed Bin Rashid Al Maktoum,
Ruler of Dubai
IN THE SMALL CLAIMS TRIBUNAL OF DIFC COURTS
BEFORE H.E. JUSTICE MAHA ALMHEIRI
BETWEEN
Laurance LLC
Claimant
and
Lazarus
Defendant
| Hearing : | 30 November2022 |
|---|---|
| Further Submissions : | 15 December 2022 |
| Judgment : | 26 December 2022 |
JUDGMENT OF H.E. JUSTICE MAHA ALMHEIRI
UPON this Claim being filed on 7 November 2022
AND UPON a hearing having been listed before H.E Justice Maha Al Mheiri on 30 November 2022, with the Claimant’s representative and the Defendant attending
AND UPON reading the submissions and evidence filed and recorded on the Court file
IT IS HEREBY ORDERED THAT:
1. The Claimant’s Claim shall be dismissed.
2. Each party shall bear their own costs.
Issued by:
Delvin Sumo
Assistant Registrar
Date of Issue: 26 December 2022
At: 12:45pm
THE REASONS
The Parties
1. The Claimant is Laurance LLC (the “Claimant”), a consultancy specializing in project and cost management services located in Dubai.
2. The Defendant is Lazarus (the “Defendant”), an individual that hired the Claimant to manage the construction of his villa located in Dubai (the “Premises”).
Background and the Preceding History
3. On May 2021, the Defendant appointed the Claimant as project manager company for the renovation and refurbishment of his Premises (the “Project”). The Parties signed a contract for the Claimant to review the existing design, update construction detailing, select more appropriate finishes and supervise the fit out of the Premises (the “Project Management Contract”).
4. The Claimant reached out to various contractors and prepared a list of recommendations, which the Defendant approved. The Project was to be completed by December 2021 and the Claimant had assured the Defendant the same timeline.
5. On 19 December 2022, the Claimant reached out to the Defendant for a variation to the Project Management Contract seeking an extension of 4 months to the Project, with an estimated delivery date of April 2022. The Project was not completed in April 2022. The Claimant further extended its services until August 2022 but did not charge the Defendant for those extra months of services provided.
6. The Defendant paid the Claimant’s fees until February 2022, in the amount of AED 440,469.30, and did not receive the completed Project by August 2022.
7. On 7 November 2022, the Claimant filed a claim against the Defendant in the DIFC Courts’ Small Claims Tribunal (the “SCT”) claiming payment for the management services that the Claimant provided for the months of March and April 2022 in the amount of AED 87,570.
8. On 15 November 2022, the Defendant filed an Acknowledgment of Service intending to defend all of the claim.
9. The parties met for a Consultation with SCT Judge Ayman Saey on 21 November 2022 but were unable to reach a settlement. In line with the rules and procedures of the SCT, this matter was referred to me for determination, pursuant to a Hearing held on 30 December 2022.
The Claim
10. The Claimant’s case is that they were appointed as the project management company to handle the Defendant’s Project. The initial Project Management Contract was signed to be completed on 31 December 2021, which was extended until 31 April 2022, a monthly payment of AED 41,700 was included within this 4-month variation. The Defendant failed to pay for the months of March and April despite the Claimant completing its post contract services.
11. The Claimant submits that there were further delays to the Project through no fault of the Claimant and submits that the Claimant continued to provide its services past the April 2022 variation without billing them to the Defendant until August 2022, at which point the contractor reached practical completion and could apply for the municipality approvals. A final report was issued on 5 September 2022.
12. The Claimant seeks the payment of AED 87,570 from the Defendant for the services provided in March and April 2022.
The Defence
13. The Defendant submits that it had contracted with the contractors that were recommended and endorsed by the Claimant. After paying a substantial sum to Claimant, the Defendant submits that the Project was handed over in complete disarray and was not close to completion.
14. The Defendant submits that it had to appoint another project management company for a substantial sum to get the work done that was supposed to be completed by the Claimant.
15. The Defendant submitted an Inspection Report along with the pictures as evidence to the status of the Premises provided by the newly appointed project management company. The Defendant argues that the Project had to had undergo a lot of work in order to undo the poor work done under the supervision of the Claimant through the contractors it had recommended.
16. The Defendant denies that the Claimant is entitled to payment for the months of March and April and requests that its claims be rejected.
Discussion
17. In the hearing, the Court requested that the Claimant provide a logbook to demonstrate that the Claimant was present at the site to supervise and be present at any major installations on the Defendant’s project. The Claimant failed to demonstrate any evidence to show that it was aware of the installation that were being undertaken at the Premises. The “Compass Project Consulting” document sets out that the Claimant should have visited the Project on a weekly basis, but no evidence of the Claimant’s fulfillment of this obligation was provided.
18. The Claimant did submit 1-page document under the title of “Compass Scope Of Work Check List for SCT-393-2022”. This document appears to be produced to serve the case and is not one that was updated regularly during the duration of the Project. It should be highlighted that under the heading ‘Produce Procurement Strategy’, the Claimant has mentioned that:
“No matrix was distributed. Responsibilities were discussed in meetings and in person only”.
19. This responsibility matrix was part of the Claimant’s obligations as submitted in the “Compass Project Consulting” document.
20. In addition, although the Claimant argues that the delays on the Project were through no fault of the Claimant, it is the Claimant’s core role is to manage the Project having the Defendant’s interest at the forefront. Managing the Defendant’s Project efficiently and in a cost effective manner was key. I find that this expectation was not met, as evidenced by the Project being not completed until August 2022.
21. Although the Claimant submits that the completion report was issued for the Project in September 2022, it was not submitted as evidence to the Court. The Court reviewed the Inspection Report submitted by the Defendant, which sets out:
“1. All Filters are completely filled and blocked with fine dust.
2. Duct Condition: All The Ducts are in a bad state. There is a layer of micro dust and debris found on the bottom layer of the ducts.
3. Chill water pipes full of fungus on the insulation due to bad quality of material and installation.
4. Pipes rusted and in bad condition.”
22. The Defendant did assign a new project management company to continue and rectify the work that should have been supervised by the Claimant and Its recommended contractors. The Court agrees with the Defendant’s argument that the Claimant failed to manage the project as expected from it. For the above cited reasons, I find that the Claimant’s claim must be dismissed.
23. Each party shall bear their own costs.
