Cassation No.

5/2018 (Judicial Tribunal) )‫ (هيئة‬2018/5 ‫الطعن رقم‬

In the Name of Allah Most Gracious Most Merciful

In Name of His Highness Sheikh

Mohammed bin Rashid Al Maktoum,
Ruler of Dubai

In the session held in Dubai Courts 28

building, Chief Justice Meeting room, on
2019 1
Monday 18th January 2019.

Presided by Counselor Justice/ Fatihah

Mahmood Qora, Acting Chairman of the
Judicial Tribunal for Dubai Courts and
Dubai International Financial Center
Courts;

and membered by Counselor/ Zaki Bin

Azmi, Chief Justice of Dubai
International Financial Center Courts;

Counselor/ Khalifa Rashid bin Dimas,

The Secretary-general of the Judicial
Council;

Counselor/ Essa Mohammad Sharif,

Chief Justice, of the Appeal Court;

Counselor/ Omar Juma Al Muhairi,

Deputy Chief Justice of Dubai
International Financial Center Courts;

Counselor/ Jasim Mohammad Baqer,

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Cassation No. 5/2018 (Judicial Tribunal) )‫ (هيئة‬2018/5 ‫الطعن رقم‬

Chief Justice of the First Instance Courts,

Counselor/ Sir Richard Field, Judge of

the First Instance Court, DIFC - Tribunal
Member.
-

And in the presence of Mr. Abdul Rahim

Mubarak Al Bolooshi, Rapporteur of the
JT.

Cassation No. 5/2018 (JT) 2018 5

Appellant: NATIONAL BANK OF

KUWAIT S.A.K.P.

Respondent: (I) SBM BANK 1

(MAURITIUS) LTD; (2) RENISH 2
PETROLEUM FZE; (3) 3
HITESHKUMAR CHINUBHAI 4
MEHTA; (4) PRIME ENERGY FZE

Judgment

Having perused the file and

documents and after deliberation, the
Cassation had satisfied the necessary
requisites of form and hence it is
accepted in form.
The relevant facts are as follows:

1. The First Respondent (“SBM”) (as 1

lender), the Second Respondent
(“Renish”) (as borrower) and the
Third Respondent (“Mr Mehta”) (as

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Cassation No. 5/2018 (Judicial Tribunal) )‫ (هيئة‬2018/5 ‫الطعن رقم‬

guarantor) are parties to a written

facility agreement. By clause 27, the
facility agreement (apart from the
27
guarantee) is governed by English
law and the courts of the DIFC have
jurisdiction over any dispute arising
out of or in connection with the
agreement. The guarantee is
governed by the laws of the UAE
and, for the benefit of the First
Respondent (SBM) only, it contains
a non-exclusive jurisdiction clause in
favour of the “Courts of Dubai”.

2. The First Respondent (SBM) was

2
told that the money to be advanced
under the facility agreement was to
be used to enable the Second
Respondent (Renish) to make
payments to the Fourth Respondent
(Prime) for the purchase of
consignments of fuel oil due to be
delivered at Khor Fakkan Port,
Sharjah, which the Second
Respondent (Renish) would then sell
on to Lanka IOC plc (“Lanka”) for Lanka IOC
delivery in Sri Lanka.
plc

3. Pursuant to the facility agreement,

3
the First Respondent SBM) made 4
4
payments totaling USD
40,445,168.25 to the Fourth 40,445,168.25
Respondent (“Prime”). These
payments were made into the bank
account of the Fourth Respondent
(Prime) held by the Appellant
(“NBK”) at its branch in onshore
Dubai.
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Cassation No. 5/2018 (Judicial Tribunal) )‫ (هيئة‬2018/5 ‫الطعن رقم‬

4. The Second and Third Respondents 4

(Renish and Mr Mehta) paid only
10,408459
USD 10,408459 of the sum due and
thereafter defaulted, owing an
accelerated balance of USD
30,218,917.59. The First Respondent 30,218,917.59
(SBM) reasonably concluded that it
had been the victim of a fraud
perpetrated by the Second, Third and
Fourth Respondents (Renish, Mr
Mehta and Prime) and on 2 August 2018 2
2018 DIFC Court granted the First
Respondent (SBM) an ex parte
worldwide freezing order (“WFO”)
7 WFO
until 7 August 2018 ordering the
Second, Third and Fourth 2018
Respondents (Renish, Mr Mehta and
Prime) not to dispose of their assets
up to a total of USD 30,218,917.59.
30,218,917.59
5. On 6 August 2018, the First 2018 6 5
Respondent (SBM) amended its
Claim Form to include a claim
against the Appellant (“NBK”) for a
declaration that it holds all sums
received from the First Respondent
(SBM) and/or the traceable proceeds
thereof on constructive trust for the
First Respondent (SBM). It is not
alleged that the Appellant (NBK)
participated in the fraud practiced by
the Second, Third and Fourth
Respondents (Renish, Mehta and
Prime) or that, when the money was
received into the account the
Appellant (NBK) held for the Fourth
Respondent (Prime), the Appellant

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Cassation No. 5/2018 (Judicial Tribunal) )‫ (هيئة‬2018/5 ‫الطعن رقم‬

(NBK) knew that the money had

been stolen.

6. Following a hearing on 7 August 7 6

2018 at which the Second, Third and 2018
Fourth Respondents (Renish, Mr
Mehta and Prime) and the Appellant
(NBK) did not appear, DIFC Court
ordered that the WFO be continued
WFO
until further order. The Court also
made an order (“the JDO”) joining
JDO
the Appellant (NBK) into the
proceedings as the fourth defendant
and ordering the Appellant (NBK) to
produce forthwith to the First
Respondent (SBM) copies of the
bank statements relating to all the
accounts held by the Fourth
Respondent (Prime) for the period 1
2 2018 1
March 2018 to 2 August 2018 to help
2018
the First Respondent (SBM) trace the
stolen money.

7 7
7. At the hearing on 7 August 2018,
2018
there was a discussion between the
judge and the First Respondent’s
(SBM’s) lawyer as to whether the
JDO
Court had jurisdiction to make the
JDO against the Appellant (NBK).
The First Respondent’s (SBM’s)
lawyer contended that DIFC Court
had such jurisdiction by virtue of
Article 5(A)(1)(b) of the Judicial 1 5
Authority Law (Law No. 12 of 2004) 12
(“the JAL”) on the basis that the First 2004

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Cassation No. 5/2018 (Judicial Tribunal) )‫ (هيئة‬2018/5 ‫الطعن رقم‬

Respondent’s (SBM’s) claim against

the Appellant (NBK) “arises out of or "
relates to” the facilities agreement
which was to be performed in part in
the DIFC because the First
Respondent (SBM) had stipulated
under the facility agreement that
repayments were to be made into a
bank account within the DIFC. It is
implicit in the DIFC Judge’s decision
to make the JDO that he accepted the
JDO
First Respondent’s contention as to
jurisdiction.

8. Enforcement letters dated 29 August 29 8

2018 were prepared by DIFC Court 2018
and sent to the Chief Judge of Dubai
Courts of First Instance, following 26
which, on 26 September 2018, the 2018

Dubai Execution Court issued an

order requiring the Appellant (NBK)
to comply with the WFO and the WFO
JDO
JDO. Notice of the enforcement
order made by the Dubai Execution
Court was served on the Appellant
(NBK) on 3 October 2018.
2018 3

9. On 20 September, 2018, the 2018 20 9

Appellant (NBK) filed its
Acknowledgement of Service in
DIFC Court proceedings in which it
stated it intended to challenge in

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Cassation No. 5/2018 (Judicial Tribunal) )‫ (هيئة‬2018/5 ‫الطعن رقم‬

DIFC Court the jurisdiction of DIFC

Court to make the JDO against it.

10. Rather than challenge DIFC Court’s 10

decision on jurisdiction in that court,
on 27 September 2018 the Appellant 27
(NBK) commenced proceedings in 2018
Dubai Courts (Case no. 2075/2018)
in which one of its principal claims is
that DIFC Court did not have 2018 2075

jurisdiction to make the JDO against

it. This claim has been repeated in
the submissions made by the
Appellant (NBK) to the Joint Judicial
Council (“the JJC”).

11. On 4 October 2018, the JJC accepted 2018 4 11

the Appellant’s (NBK’s) claim
alleging a conflict of jurisdiction
between Dubai Courts and DIFC
Courts.

Decision

12. Since the paperwork confirms that 12

there are two substantive cases
before DIFC Court and Dubai
Courts, the First Case No. (CFI-054-
CFI-054-2018
2018) and the Second Case No.
2018 2075
(2075/2018) and that there is a
conflict of jurisdiction held by each

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Cassation No. 5/2018 (Judicial Tribunal) )‫ (هيئة‬2018/5 ‫الطعن رقم‬

of them under this Cassation No. 2018 5

5/2018, in order to resolve this
conflict and to determine the
jurisdiction of one of them pursuant
to the rules in the aforementioned
text and in accordance with the 19
authority given to the JT under Law 2016
No. (19) of 2016, it is hereby decided
as follows:

13. The Judicial Tribunal considers that 13

it is in the jurisdiction of DIFC
Courts (Not to Dubai Courts) in the
subject of this dispute and DIFC
Courts may exercise and handle the
case before it for all the litigants,
including (NATIONAL BANK OF
KUWAIT S.A.K.P.), and may issue
orders, decisions and judgments
therein. Therefore, Dubai Courts has
not the jurisdiction in this regard, on
the basis of:

1
(1) DIFC Court made its order
against the Appellant (NBK) on 7
August 2018 whereas no
2018 7
judgment has yet been issued by
Dubai Court.

2
(2) The Dubai Execution Court issued
an order on 26 September 2018 2018 26
requiring the Appellant to comply
with the orders of DIFC Court.

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Cassation No. 5/2018 (Judicial Tribunal) )‫ (هيئة‬2018/5 ‫الطعن رقم‬

(3) The are no proven grounds that 3

the Appellant (NBK) would suffer
a prejudice in complying with the
orders of DIFC Court which it
would not suffer if made subject
to equivalent orders issued by
Dubai Court.

14. For these reasons: 14

The Judicial Tribunal decides:

(1) The cassation is dismissed. 1

(2) The stays imposed on DIFC 2

Court’s proceedings and the
Dubai Execution Court’s
proceedings are discharged.

(3) The Appellant must pay the

3
Judicial Tribunal fees and the
deposit is forfeited.

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