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Claim No: SCT 228/2024

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
BEFORE H.E. JUSTICE MAHA AL MHEIRI

BETWEEN

NIHAN

Claimant

and

NYASIA

Defendant

JUDGMENT OF H.E. JUSTICE MAHA AL MHEIRI

UPON the Claimant’s claim filed a 5 June 2024, and the amended claim on 4 July 2024 (the “Claim”)

AND UPON a hearing held before H.E. Justice Maha Al Mheiri on 13 August 2024, with the Claimant’s and the Defendant’s representatives in attendance (the “Hearing”)

AND UPON reviewing the documents and evidence filed and recorded on the Court file

IT IS HEREBY ORDERED THAT:

1. The Defendant shall pay the Claimant to the amount of AED 19,384.06.

2. The Defendant shall pay the Claimant the Court fees to the amount of AED 969.20.

3. The Defendant’s Counterclaim is dismissed.

Issued by:
Delvin Sumo
SCT Judge and Assistant Registrar
Date of issue: 31 October 2024
At: 1pm

THE REASONS

The Parties

1. The Claimant is Nihan (the “Claimant”), an individual who sought the services of the Defendant to apply for a visa.

2. The Defendant is Nyasia (the “Defendant”), a company specialized in immigration services registered and located in Dubai.

Background and the Preceding History

3. On 18 September 2022, the Claimant appointed the Defendant for immigration services to apply for and obtain a Portugal D2 business visa (the “Visa”) in return for payment of AED 31,500, exclusive of any third-party fees (the “Agreement”). The Claimant paid the downpayment of AED 21,000 to proceed with the Agreement. Additionally, the Claimant paid AED 15,026 for third-party services related to government procedures and the company's trading license.

4. On 13 January 2023, the Claimant executed the company incorporation documents in an online meeting with the Portuguese lawyer and Neelam, the employee of the Defendant. The company’s trade license was issued on 18 January 2023.

5. On 7 March 2023, the Claimant received the commercial license via email. The license was valid for three months, having been issued on 18 January 2023, and set to expire on 18 April 2023. The Claimant was only informed of the issuance of the commercial license 48 days after issuance. The Claimant addressed these concerns, highlighting their lack of follow-up and transparency. The Claimant requested an extension of the license for one year, which they agreed to without imposing any additional renewal fees.

6. On June 2023, the Claimant granted special authorization to the Defendant’s assigned lawyer to initiate the process of opening a corporate bank account. Despite repeated follow-ups between June and September, the Claimant received no updates from the Defendant in relation to the status of the Visa.

7. During a visit to Portugal to oversee the procedures, the Claimant requested contact details for the appointed lawyer from Neelam. Instead, the Claimant was provided with the contact information of an alternate lawyer, who, upon meeting, revealed her association with the original lawyer but lacked knowledge of the Claimant’s case. This resulted in additional, unforeseen expenses for account opening services, which should have been covered previously. Due to the Defendant’s actions from June to September, the Claimant rescinded the lawyer’s authorization and notified the Defendant.

8. Upon further investigation, the Claimant discovered that the company to be set up was not registered in the commercial registry and its address was listed under a paper copy shop. In November 2023, the Claimant ascertained that the accountant for the company to be set up had failed to declare the company’s value-added tax for the first three quarters. The Claimant requested Neelam to provide the accountant's contact information to address this oversight, emphasizing the risk of incurring fines. Neelam response was delayed and uninformative. Initially, the Defendant declined to provide the Portuguese lawyer’s contact details citing policy restrictions. However, upon notifying them of the financial penalties due to the accountant's negligence, the Defendant provided the contact details for both the lawyer and the accountant. By then, the delay had caused significant financial repercussions. Consequently, the Claimant informed the company of his intention to seek redress for the incurred fines through the DIFC Courts.

9. The Claimant traveled twice to Portugal to sort out his company’s situation. The first time was from 5 to 7 September 2023, and the second time was from 5 to 11 November 2023.

10. On 4 July 2024, the Claimant filed the amended claim in the DIFC Courts’ Small Claims Tribunal (the “SCT”) claiming the following amounts for the fines incurred and the travel expense to Portugal from the Defendant, as follows;

4. On 12 July 2024, the Defendant filed a counterclaim (the “Counterclaim”) seeking the amount of AED 5,000 for damaging the Defendant’s reputation and loss of time to defend the Claim.

5. In accordance with the rules and the procedures of the SCT, the matter was referred to me for determination, pursuant to the Hearing. After reviewing all documents and evidence submitted on the Court file, I give my judgment below.

Discussion

6. This dispute is governed by the DIFC Contract Law with the relevant case law and principles concerning a breach of contract. Neither party has disputed the jurisdiction of the DIFC Courts and thus the Court assumes jurisdiction of this dispute. Clause 4 of the Terms of Business in the Agreement stipulates the following:

7. In essence, the disagreement between the parties pertains to whether the Claimant should be paid for the fines, flight tickets, hotel booking and car rental (the “Damages”) that he incurred due to the Defendant’s negligence.

The Claim

8. The Defendant argues that the Claimant never paid the Defendant to engage an accountant for handling his company matters in Portugal. As stated above, the Claimant paid the non-refundable third-party charges to the Defendant to engage a legal service in Portugal to obtain the limited services for registration for his NIF and Portuguese company. The agreed service was completed, and the NIF and company registration were provided to the Claimant.

9. The Defendant also argues that it is the Claimant's responsibility to comply with Portuguese government rules to maintain his company registration in Portugal by making and submitting the VAT declaration to concerned Portuguese government authority and avoiding fines from the Portuguese Government and that does not fall under the Defendant’s services.

10. The Defendant submits that the Claimant, by his own choice, wanted to meet the same lawyers in Portugal who offered him the services for his NIF and company registration, which the Defendant arranged an appointment with the third-party lawyer in Portugal. The arrangement of the Claimant's appointment with the third-party lawyer does not come under the scope of services of the Defendant in the Agreement, and any dealings between the Claimant and the third-party lawyer are direct dealings and the Defendant is not involved.

11. The Defendant also adds if the Claimant was not satisfied with his direct dealings with the third-party lawyer in Portugal, the Defendant should not be responsible for any fines incurred as the third-party lawyer in Portugal is not a party to the Agreement between the Claimant and Defendant.

12. In review of the submissions made by both parties, I find that although the Defendant submits that he is not responsible for the actions of the lawyer and the accountant that he suggested to offer the Claimant, there is a responsibility on the Defendant to guide the Claimant through the process and what to expect.

13. The Defendant had a duty of care to guide the Claimant on the process and what to expect, the Defendant had neglected to inform the Claimant on the process and guide him on what services that the lawyer and accountant that they assigned for the Claimant to continue the process and what does not fall under their responsibility.

14. In review of the submissions, the Claimant submitted evidence to support that he was constantly asking for the information regarding the lawyer and the accountant which the Defendant failed to provide and delayed in giving. The Claimant had no choice but to travel to Portugal to sort out his company.

15. The Court does not agree with the Defendant’s submissions that the fines enquired due to the Claimant, the Court finds this accusation is baseless as the Defendant is the expert in this field and it is the Defendant’s duty to guide the Claimant through the whole process or give him the right information on the process. Since the Defendant recommended the lawyer and accountant, the Defendant should advise the Claimant on the services that they will provide and what should be handled by the Claimant on his own.

16. In my view, the Defendant is negligent in providing the right support and guidance to the Claimant, the core purpose behind hiring the Defendant was to obtain the Portugal D2 Visa. As a result, the Court finds that the Claimant is entitled to seek damages against the Defendant’s negligence. In addition, the Claimant provided all receipts and invoices to support the damages Claims requested.

17. As such, the Defendant shall pay the Claimant the amount of AED 19,384.06 in damages.

Counterclaim

18. The Defendant seeks the payment of AED 5,000 for damaging the Defendant’s reputation and loss of time to defend the Claim.

19. The Court finds the Counterclaim to be without merit as it’s the Claimant’s right to file a claim in the situation of negligence. In addition, the Defendant did not meet the burden of proof to demonstrate that it suffered due to the claimed filed.

20. The Defendant did not provide any evidence to support their Counterclaim or provide the legal basis or justification to claim the AED 5,000. As such, the Defendant’s Counterclaim is dismissed.

Conclusion

21. In light of the aforementioned, I find that the Defendant shall pay the Claimant the sum of AED 19,384.06 in addition to the Court fees in the amount of AED 969.20.

22. The Defendant’s Counterclaim is dismissed.