December 22, 2023 SCT - JUDGMENTS AND ORDERS
Claim No. SCT 427/2023
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE SMALL CLAIMS TRIBUNAL
BETWEEN
NAVA
Claimant
and
NYLIS
Defendant
ORDER WITH REASONS OF SCT JUDGE AND REGISTRAR AYESHA BIN KALBAN
UPON reviewing the Claim Form dated 27 October 2023 (the “Claim”)
AND UPON a Jurisdiction Hearing having been held before SCT Judge and Registrar Ayesha Bin Kalban on 27 November 2023 with the Claimant’s and the Defendants’ representatives in attendance
AND UPON reading the submissions and evidence filed and recorded on the Court file
IT IS HEREBY ORDERED THAT:
1. The DIFC Courts have jurisdiction to hear and determine this claim.
2. Each party shall bear their own costs.
Issued by:
Delvin Sumo
SCT Judge and Assistant Registrar
Date of Issue: 22 December 2023
At: 8am
SCHEDULE OF REASONS
The Parties
1. The Claimant is Nava (the “Claimant”) a law firm located in DIFC, Dubai, the UAE.
2. The Defendant is Nylis (FZ) (the “Defendant”) a company located in Dubai, the UAE.
The Claim
3. The Claimant brings this claim seeking sums allegedly owed by the Claimant to the Defendant in the amount of AED 222,904.50 pursuant to legal services provided under a Terms of Engagement Letter entered into on 17 January 2023 (the “Letter”).
The Jurisdiction Application
4. The Defendant’s Acknowledgement of Service dated 3 November 2023 set out its intention to contest the jurisdiction of the DIFC Courts. The crux of this challenge lies within the Defendant’s contention that Clause 17 of the Letter is invalid and that the Letter does not comply with Article 52 of Federal Decree Law No. 34 of 2022 on Regulating the Advocacy and Legal Consultancy Professions (the “Advocacy Law”). The Defendant also relies on a decision issued by the Dubai Court of Cassation in the year 2018.
5. The Defendant takes the position that a lawyer’s fees can only be assessed by the court that heard the case within which the lawyer was instructed. The Defendant also makes reference to the Dubai Court of Cassation decision on similar grounds, and therefore takes the position that the competent court to deal with this decision is the Courts of Abu Dhabi, in light of the Claimant being instructed in regards to a matter before that Court. I have had some difficulty in deciphering the Claimant’s submissions, however I believe the above summarises the Claimant’s position within the limited scope of the jurisdictional challenge that I am tasked to determine.
6. The Claimant has provided various submissions in response to the Defendant’s challenge, namely to provide distinctions between the terms defined in the Advocacy Law, and to reiterate that the Claimant is a DIFC establishment which falls under the jurisdictional gateway of Dubai Law No. 12 of 2004 as amended, the Judicial Authority Law (the “JAL”).
7. I do not propose to go through every submission made by both parties, but that does not mean I have not considered them.
Discussion
Article 5(A) of the JAL sets out the DIFC Courts’ jurisdiction over:
i. “(a) Civil, commercial and labour claims to which the DIFC or any DIFC Body, DIFC Establishment or Licensed DIFC Establishment is a party;
ii. (b) Civil, commercial and labour 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;
iii. (c) Civil, commercial and labour 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; . . .
iv. (e) Any claim or action over which the Courts have jurisdiction in accordance with DIFC Laws and DIFC Regulations. . . “
8. The JAL is quite clear that the DIFC Courts is the competent court to hear and determine claims to which a DIFC entity is a party, regardless of whether the Court is to take Clause 17 of the Letter into consideration.
9. Furthermore, I take the view that the Defendant’s reliance on the Advocacy Law is misplaced. The Federal Law No. 8 of 2004 Regarding Financial Free Zones has, at Article 3(2), provided an exemption to DIFC entities from the application of all federal civil and commercial laws. This has the effect of removing the applicability of the Advocacy Law within the DIFC, being a financial free zone as defined in the Federal Decree No. 35 of 2004.
10. For the above cited reasons, I find that the DIFC Courts has jurisdiction over this Claim and dismiss the Defendant’s jurisdictional challenge henceforth.
