September 06, 2024 SCT - JUDGMENTS AND ORDERS
Claim No: SCT 205/2024
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
In the name of His Highness Sheikh Mohammad Bin Rashid Al Maktoum, Ruler of Dubai
IN THE SMALL CLAIMS TRIBUNAL
BEFORE H.E. JUSTICE MAHA AL MHEIRI
BETWEEN
NAATHIM
Claimant
and
(1) NABEEL
(2) NASRULLAH
Defendants
| Hearing : | 4 July 2024 |
|---|---|
| Judgment : | 6 September 2024 |
JUDGMENT OF H.E. JUSTICE MAHA AL MHEIRI
UPON the Claim Form being filed on 20 May 2024 (the “Claim”)
AND UPON a hearing held before H.E. Justice Maha Al Mheiri on 4 July 2024, with the Claimant, Defendant and the Second Defendant’s representative in attendance (the “Hearing”)
AND UPON reviewing the documents and evidence submitted in the Court file
IT IS HEREBY ORDERED THAT:
1. The Claimant’s Claims are dismissed.
2. The Claimant shall pay the Second Defendant the amount of AED 18,750.
3. The Claimant shall pay the Second Defendant’s DIFC Courts’ filing fee in the amount of AED 937.50.
Issued by:
Delvin Sumo
SCT Judge and Assistant Registrar
Date of issue: 6 September 2024
At: 8am
Parties
1. The Claimant is Naathim (the “Claimant”), an individual that rented a kiosk from the Second Defendant
2. The First Defendant is Nabeel (the “First Defendant), previous employer of the Claimant.
3. The Second Defendant is Nasrullah (the “Second Defendant), property management company, licensed in Dubai, UAE.
Background and Hearing
4. The First Defendant and the Second Defendant entered into a lease agreement for his restaurant located onshore Dubai . The First Defendant hired the Claimant as an employee with the designation of floor manager at his restaurant.
5. The Claimant wanted to open a kiosk for her small business. The First Defendant gave the Claimant a loan in the amount of AED 75,000 to start her business. The First Defendant also introduced the Claimant to the Second Defendant to lease a kiosk as they are a property management company.
6. The Claimant, with the help of the First Defendant, issued the registration of her business under the trade name "Nadid " and her trade license. After which, the Claimant submitted all the required documents to the Second Defendant and was provided with the tenancy contract (the “Tenancy Agreement”) including all terms and all drawings of the kiosk directly to the Claimant’s email.
7. On 19 February 2024, the Claimant signed the Tenancy Agreement at the Second Defendant’s offices in the presence of the First Defendant. The Claimant claims that she gave the amount of AED 75,000 for the rent of the kiosk to the Second Defendant in cash; this is denied by the Defendants.
8. The Second Defendant emailed the Claimant the Tenancy Agreement and a reminder to complete the remainder of the process, being the rent amount. In reply, the Claimant requested that the Second Defendant send the Tenancy Agreement in Arabic for her to understand her obligations.
9. There was a lot of correspondence between the Claimant and the Second Defendant in relation to the Tenancy Agreement which resulted in the Claimant requesting from the First Defendant to cancel the Tenancy Agreement and refund the rent amount. The Claimant submits that when she communicated to the First Defendant her request to cancel the Tenancy Agreement, she was informed that she had to pay a cancelation fee of AED 10,000, which she paid to the First Defendant to cancel the Tenancy Agreement. This statement is denied by the First Defendant stating that he never received any money from the Claimant.
10. On 16 April 2024, the Second Defendant sent an email to the Claimant stating the following:
“To: Naathim naathim@gmail.com
First of all, the contract was signed on 19/02/2024, and the contract effectively started on 01/03/2024 until 28/02/2025 under the trade name Nadid . You inspected the property and you have come to the company’s head office by yourself and signed the contract for the amount of AED 75,000 in one cash payment, and you have signed the tenancy contract, undertaking letter and the key handover form.
Second, you have signed key handover form on the same date as signing the contract on 19/02/2024, and you were given ten days to place your machines, and get the equipment ready as the premises is ready to move in.
Third, you requested a period of two days after signing the contract to obtain initial approval and obtain your commercial license.
Fourth, we did not receive any cash amounts related to the payment of the tenancy contract, and your claim that you do not know where the premises is and that the project is fake is a false claim on your part because the tenancy contract was sent to you on your email with all the details. Rather, you are evading payment and fulfilling your obligations, and we will take all the legal actions needed in which preserves our rights to what you claim
Fifth, the rent of AED 75,000 is due and should be paid in full in one cash payment as per the payment terms in the tenancy contract, and the fact that the premises is with you and you are still refusing to pay, it is why we will take the appropriate legal action.
Sixth: Your claim that the contract is in English and that you do not understand the English language, is a false claim, because working as a manager in a tourist restaurant location; in t onshore Dubai in the same building where your premises is located and signing the contract in English without us restricting the signature to be in English Language. You even signed the contract in your name in English, and no one in the UAE can force someone to sign a document which he knows nothing about, and this claim is invalid (despite that, we sent this email in both Arabic and English) and we will take the necessary legal action.
Seventh: If you wish to terminate the contract and not continue with the rental, you must send an email to terminate the contract and not continue the rental relationship, and you will be subject to the following:
* Payment of the monthly rent of AED6,250 per month from 1/3/2024 until the date of final cancellation.
* Penalty for early contract termination of three months of the rental value according to the lease contract in the total amount of AED18,750.
Accordingly, in the event of non-response, legal action will be taken.”
11. On 20 May 2024, the Claimant filed a case in the DIFC Courts Small Claims Tribunal (“SCT”) against the First Defendant seeking the refund of the amount of AED 10,000 and from the Second Defendant the refund of the amount of AED 75,000 for the rent paid.
12. On 24 May 2021, the First Defendant filed an Acknowledgment of Service intending to defend the whole claim and the Second Defendant filed an Acknowledgment of Service and Counterclaim requesting that the Claimant pay the Defendant the amount of AED 75,000 for the kiosk rent amount.
13. The Court scheduled a consultation before SCT Judge Delvin Sumo on 10 June 2024, but the parties 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 4 July 2024 with the parties in attendance.
14. During the course of the Hearing, the First Defendant made submissions as to the fact that the Claimant had failed to pay the loan amount. This counterclaim was not filed formally before the Court pursuant to the Rule 21.8 of the Rules of the DIFC Courts (the “RDC”), therefore I shall not address it in my findings below.
Findings
15. The dispute is governed by the DIFC Law of Contract and the relevant case law and principles concerning a breach of contract. Pursuant to Clause 12 of the Agreement, as stated:
“12 JURISDICTION
12.1 This agreement shall be governed by the laws of Dubai and extensive jurisdiction of Dubai International Financial Centre in English Language.
12.2 Any dispute, difference, controversy or claim arising out of or in connection with this contract, including (but not limited to) any question regarding its existence, validity, interpretation, performance, discharge and applicable remedies, shall be subject to the exclusive jurisdiction of the Small Claim.”
16. I will first deal with the Claimant’s Claim against the Second Defendant and the Counter Claim as they are both in relation to the rent amount in the Tenancy Agreement.
The Claim’s against the Second Defendant and CounterClaim
17. There is no disagreement between the parties in relation to validity of the Tenancy Agreement. In essence, the disagreement between the parties pertains to whether the rent amount was paid by the Claimant or not.
18. There is no evidence given by the Claimant to prove that the rent amount of AED 75,000 was paid to the Second Defendant in the presence of the First Defendant. The Claimant relies on oral submission that is not backed by any evidence. In addition, the Defendants deny the Claimant’s statement that the rent amount was paid in front of the First and Second Defendant in cash.
19. In review of the submission, there is evidence before the Court that proves that the Claimant wanted to terminate the Contract after receiving the Tenancy Contract by email from the Second Defendant. In reply to the Claimant’s request the Second Defendant replied with the following:
“* Payment of the monthly rent of AED6,250 per month from 1/3/2024 until the date of final cancellation.
* Penalty for early contract termination of three months of the rental value according to the lease contract in the total amount of AED18,750.”
20. The Court shall consider the Second Defendant’s email as confirmation of the mechanism to cancel the Tenancy Contract, being paying the pro-rata rent value equivalent to 3 months in the amount of AED 18,750.
21. As such the Claimant’s claim against the Second Defendant for the refund of the amount of AED 75,000 is dismissed.
22. The Second Defendant’s Counterclaim is accepted. The Claimant shall pay the Second Defendant the amount of AED 18,750 equivalent to three months of the rental value for early termination.
The Claim’s against the First Defendant
23. The Claimant is seeking the refund of the amount of AED 10,000 from the First Defendant in relation to the cancelation of the Tenancy Contract. There is no evidence given by the Claimant to prove that the amount of AED 10,000 was paid to the First Defendant.
24. As such the Claimant’s claim against the First Defendant for the refund of the amount of AED 10,000 is dismissed.
In Conclusion
25. The Claimant’s claims against the Defendants are dismissed.
26. The Claimant shall pay the Second Defendant the amount of AED 18,750 equivalent to three months of the rental value for early termination.
27. The Claimant shall pay the Second Defendant’s court fee in the amount of AED 937.50.
