December 14, 2023 SCT - JUDGMENTS AND ORDERS
Claim No: SCT 392/2023
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE SMALL CLAIMS TRIBUNAL
BETWEEN
MURBAKI
Claimant
and
MITHILA
Defendant
ORDER WITH REASONS OF SCT JUDGE AND ASSISTANT REGISTRAR HAYLEY NORTON
UPON my Order dated 16 November 2023 (the “Order”)
AND UPON reviewing the Defendant’s Application Notice dated 24 November 2023 and amended on 28 November 2023 seeking to set aside the Order (the “Application”)
AND UPON reviewing the Claimant’s evidence in answer to the Application dated 29 November 2023
AND UPON reviewing the court file and documents contained therein
AND PURSUANT TO Rules 53.2 and 53.34 to 53.36 of the Rules of the DIFC Courts (“RDC”)
IT IS HEREBY ORDERED THAT:
1. The Application shall be dismissed.
2. Each party shall bear its own costs.
Issued by:
Hayley Norton
SCT Judge and Assistant Registrar
Date of Issue: 14 December 2023
At: 8am
THE REASONS
The Parties
1. The Claimant is Murbaki, a company specialising in the sales and rental of Mobile Elevated Work Platforms based in Abu Dhabi, the UAE (the “Claimant”).
2. The Defendant is Mithila., a company registered in Dubai, the UAE (the “Defendant”).
Background
3. On 6 October 2023, the Claimant filed a claim with the DIFC Courts’ Small Claims Tribunal (the “SCT”) seeking sums allegedly owed by the Defendant in the sum of AED 7,140 (the “Claim”).
4. On 18 October 2023, the Claimant filed a Certificate of Service confirming that the Defendant had been served notice of the Claim by delivering the Claim Form at the Defendant’s registered address.
5. Thereafter, a consultation was listed before me on 16 November 2023, at which the Claimant attended and the Defendant failed to appear, although served notice of the Claim (the “Consultation”).
6. On 16 November 2023, following the Defendant’s failure to attend the Consultation and pursuant to RDC 53.32, I made an order against the Defendant in the sum of AED 7,140, in addition to an order that the Defendant pay the Claimant the DIFC Courts’ filing fee in the sum of AED 367.25 (the “Order”).
7. On 24 November 2023, the Defendant filed an Application Notice, which was later amended on 28 November 2023, seeking to set aside the Order (the “Application”).
8. In support of the Application, the Defendant submits that the DIFC Courts lack jurisdiction to hear and determine this Claim on the basis that there is no connection between the parties and the DIFC. The Defendant states as follows:
“In general, a court's jurisdiction lies in the defendant's domicile. If he has no domicile, then the jurisdiction would be the area of his residence or work. In commercial cases, the plaintiff can choose the court to which he can bring a claim to. He can bring it to either:
- the court in the area where the defendant resides
- the court in the area where the agreement was made, or executed wholly or partially
- the court in the area where the contract should have been performed.
For other types of situations, Federal Law No.11 of 1992 Concerning the Civil Procedural Law, as amended determines the jurisdiction of the courts.
None of the above three above locations is DIFC.”
9. The Claimant filed its response to the Application on 29 November 2023 and refutes the submissions provided by the Defendant. The Claimant submits that the parties have expressly agreed in writing that in the event of a dispute arising out of the hire agreements or invoices (signed by the parties), such disputes shall be heard and determined by the DIFC Courts.
Discussion
10. The relevant rules regarding an application to set aside an order are set out at RDC 53.34 and 53.35, and state as follows:
“53.34
A party who was neither present nor represented at the consultation and against whom the claim has been decided in accordance with Rule 53.32 …may apply for that order to be set aside and the claim reinstated.
53.35
A party who applies for an Order to be set aside in accordance with Rule 53.34, must make the application not more than 7 days after the day on which notice of the Order was served on him. The SCT judge who’s Order is subject to an application to set aside may extend the time for the filing of an application to set aside an order.”
11. Pursuant to RDC 53.35, an application to set aside an order must be made not more than 7 days after the day on which the notice of the order was served on him.
12. Service of the Order was effected upon the Defendant on 18 November 2023. The Defendant’s Application was filed with the Court 6 days later, on 24 November 2023. Therefore, I have determined that the Application has been filed in time.
13. RDC 53.36 sets out the requirements that an applicant must demonstrate for an order to be set aside and the claim be reinstated. The SCT Judge may grant an application only if the applicant has (i) a good reason for not attending the consultation; or (ii) has a real prospect of success in the small claim.
14. The Defendant must demonstrate at least one of the requirements set out above to be successful in its Application.
15. The Defendant has made no submissions with regards to its good reason for not attending the Consultation. Therefore, to be successful in its Application, the Defendant must demonstrate to the Court that it has a real prospect of success in the small claim.
16. When seeking to determine whether the Defendant has demonstrated a real prospect of success, I will need to consider whether the Defendant has demonstrated a ‘realistic’ rather than a ‘fanciful’ prospect of success, as confirmed by H.E Shamlan Al Sawalehi in the matter of Al Tamimi v Jorum Ltd & Anor [2016] DIFC CFI 028.
17. The Defendant’s sole argument to set aside the Order turns upon its jurisdictional challenge. Therefore, my reasons below shall address this issue.
The jurisdiction of the DIFC Courts
18. Rule 53.2 of the Rules of the DIFC Courts (“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.”
19. For cases to be heard in the SCT they must first fall within the DIFC Courts’ jurisdiction by engaging any of the jurisdictional gateways set out in the abovementioned Article.
20. Upon review of the case file and submissions contained therein, I find that neither party is, or was, a DIFC registered or licensed entity and there is no evidence to suggest that the transactions were partly or wholly performed within the DIFC or related to DIFC activities. In the absence of a sufficient nexus between the Claim and the DIFC, the DIFC Courts may still have jurisdiction over the Claim if it can be shown that the parties sought to ‘opt in’ to the jurisdiction of the DIFC Courts, pursuant to Article 5(A)(2) of the JAL.
21. In order to successfully opt in to the DIFC Courts’ jurisdiction, Article 5(A)(2) of the JAL requires that the “parties agree in writing to file such claim or action with [the DIFC Courts] whether before or after the dispute arises”.
22. The Claimant has drawn the Court’s attention to the Account Opening Form dated 12 October 2021 (the “Account Opening Form”) which includes the below clause:
“All disputes or differences arising between the parties under or in relation to any agreement shall be referred to DIFC Court SCT in Dubai, UAE and the language shall be English.” [sic]
23. The Account Opening Form has been signed by the Managing Director of the Defendant, Mr. Miskiu.
24. In addition to the above, the Claimant has provided, amongst other forms of evidence, hire agreements dated 10 March 2023 and 2 May 2023 (the “Hire Agreements”), and invoices dated 31 March 2023 and 31 May 2023 (the “Invoices”), all of which, I find, contain a form of clause sufficient for the purposes of satisfying the requirements of Article 5(A)(2) of the JAL.
25. I set out below the relevant clauses opting into the DIFC Courts’ jurisdiction, as referred to above:
The Hire Agreements:
“…the entire agreement between the parties shall be governed by, and construed in accordance with, the laws of the Dubai International Financial Centre and disputes or claims arising out of or relating to it shall be subject to the exclusive jurisdiction of the Dubai International Financial Centre Small Claims Tribunal…”
The Invoices:
“All disputes or claims arising out of or relating to this invoice shall be subject to the exclusive jurisdiction of the Dubai International Financial Centre Small Claims Tribunal…”
26. As I have found that the jurisdictional gateway under Article 5(A)(2) of the JAL has been engaged, it must follow that the DIFC Courts has jurisdiction over this Claim.
27. In light of my reasoning above, I find that the Defendant has failed to demonstrate a real prospect of success with regards to its jurisdictional challenge and has fallen short of the requirements of RDC 53.36 to be successful in its Application to set aside the Order.
Conclusion
28. For my reasons stated above, the Application shall be dismissed.
29. Each party shall bear its own costs.
