High Court overrules treaty in cross-regional dispute resolution

The judgement passed in a case related to the United Arab Emirates (UAE), Cesfin Ventures LLC vs Al Ghaith Al Qubaisi [2021] EWHC 331 highlights the complexity of cross-regional contract disputes, and the need to look outside the usual standard practices under the UAE/UK treaty. 

Disputes can arise between international parties with contracts that either settle in the UAE or where the property, debt or asset is located in the UAE. These parties could be UK residents/citizens who are engaged in business with UAE-based organisations. 

The dispute between the parties in this case relates to Service conducted between a UK organisation and a UAE-based creditor. The traditional practice in this case is to request judicial assistance through diplomatic channels, however this could delay the claimant’s case by 6-9 months before a judgement would be enforced. 

This article examines the challenges of the process when parties are based in a country outside the jurisdiction of the Court.  It also highlights the significance of enabling judicial assistance to offer alternative solutions outside the UK/UAE Treaty for matters around Personal Service. 

What happened in the court case?

The claimant in the case of Cesfin Ventures LLC vs Al Ghaith Al Qubaisi [2021] EWHC 331, sought and obtained an interim charging order over three properties in the UK belonging to the defendant, for the purpose of enforcing an unpaid judgment for costs.  There was a need to serve other creditors not party to the proceedings and be given notice of the charging order; one of which was Abu Dhabi Commercial Bank (ADCB), which is based in the UAE. 

The High Court considered the terms of the Treaty on judicial assistance between the UK and UAE to serve ADCB. In this matter, it held that it will not be consistent with the overriding objective or good case management to delay the claimants from being able to secure and enforce their judgment, through serving the notice using alternative means.

How the outcome may affect your clients

In the common law system of UK, court proceedings play a major role in setting judicial principles. The nature of the court process around Service is complex when the creditor is based in another country outside the UK.  Request for judicial assistance is made through central authorities and documents are transmitted through diplomatic channels, which can cause delays of up to 9 months. 

As the Court reasoned in its judgment, the application of alternative methods outside the Treaty to resolve the dispute enables lawyers to avoid lengthy adjournments in Service procedures, which in turn slow down court proceedings and the issuance of judgments overall. These alternative methods can include the request of judicial assistance made through central authorities and transmitted through diplomatic channels.

The new interpretation reduces delays for creditors to obtain their rights or enforce judgments against debtors. This can only be a good thing for Counsels seeking to protect the rights and interests of their clients.

Staying ahead of judicial precedents 

It is important to stay informed and keep up with the latest judgements in the UK Courts, particularly on matters that have significant impact on court proceedings and the rights of parties. 

Having access to the right legal resources, such as Practical Law Corporate, Westlaw Middle East or Westlaw Edge UK, is key for lawyers to stay up to date as these resources are constantly being updated with precedents and practices.

Contact us today to experience the Practical Law or Westlaw Middle East difference with a free trial.

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About the author:

Nadim Al Jisr

Editorial Lead, Legal Professionals, MENA, Asia & Emerging Markets

Nadim joined Thomson Reuters in 2014 as a Content Specialist, then moved to oversee the Westlaw Middle East platform and manage its growth. He has more than 10 years of experience as a legal consultant and litigator in Lebanon, Saudi Arabia and UAE. Nadim is a native Arabic speaker and proficient in English and French. He holds a bachelor's degree in law and is currently completing his master's degree in the same.