ARTICLE
4 September 2024

Guide To Litigation In The DIFC Courts And The ADGM Courts

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United Arab Emirates Litigation, Mediation & Arbitration

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Legal landscape of the DIFC courts and the ADGM courts

Overview of the DIFC Courts

The Dubai International Financial Centre ("DIFC") is a free zone in Dubai, United Arab Emirates ("UAE"), designed to be a financial hub with its own independent regulatory and legal framework for civil matters. The DIFC itself was established pursuant to UAE Federal Decree No. 35 of 2004. The DIFC Courts were then established by way of Dubai Law No. 9 of 2004, together with Dubai Law No. 12 of 2004 that governs the judicial authority of the DIFC. The DIFC judiciary is diverse and consists of judges from Australia, England and Wales, Malaysia, Scotland, and the UAE.

The DIFC Courts consist of three courts:

  1. Small Claims Tribunal ("SCT")
  2. Court of First Instance ("CFI"); and
  3. Court of Appeal ("CoA").

The SCT

The SCT was established in 2007 and hears three types of claims:

  1. Where the value of the claim is below AED500,000; or
  2. When the claim relates to the current or former employment of a party, exceeds AED500,000 and the parties agree in writing for the dispute to be heard by the SCT; or
  3. Where the claim is not employment related, does not exceed AED1 million, and the parties agree in writing that it be heard by the SCT. This election can be made in the contract between the parties or at a later stage.

The CFI

The CFI has 4 divisions: Civil & Commercial Division, Technology & Construction Division, Arbitration Division and Digital Economy Court Division.

The CFI has exclusive jurisdiction over any civil or commercial cases related to the DIFC where:

  1. Civil or commercial claims to which the DIFC "or any of the authorities, institutions of the Centre or licensed institutions thereof are a party";
  2. Civil or commercial claims arising from a contract finalised or performed within the DIFC;
  3. Civil or commercial claims arising from a transaction that has been performed within the DIFC and is related to DIFC activities;
  4. Appeals against decisions made by the DIFC; and
  5. Any claim that the Courts have jurisdiction in accordance with DIFC Laws and Regulations.

The DIFC is also an "opt-in" jurisdiction which means the CFI can hear cases where the parties to a contract agree that the DIFC Courts have jurisdiction or where the parties elect for a dispute to be heard by the DIFC Courts once it has arisen. Disputes are heard by one judge. The DIFC Courts also permit a party to be joined to proceedings even where the joined party would not otherwise be subject to the jurisdiction of the DIFC Courts, if the DIFC Courts consider the party to be a necessary and proper party to the dispute.

The CoA

The CoA is the highest court in the DIFC Courts system. Each dispute is heard by 3 judges. The CoA has exclusive jurisdiction over:

  1. Appeals on Orders or Judgments made by the CFI; or
  2. Interpretation of any articles of the DIFC's laws based on the request of any DIFC bodies or establishments (provided the establishment obtains leave from the Chief Justice).

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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