The DIFC Court of Appeal has clarified the scope of the Court’s power to grant interim relief in support of foreign proceedings, confirming that a reasonably arguable case for jurisdiction is sufficient to sustain a freezing order under the new 2025 legislative framework.
What was the nature of the dispute between Nadil and Noshaba and the Respondents Nameer and Naseema that necessitated a freezing order?
The dispute arises from allegations of deceit, conspiracy, inducing breach of contract, and unjust enrichment brought by the Appellants, Nadil and Noshaba, against the Respondents, Nameer and Naseema. The Appellants sought to protect their position by obtaining a UAE-wide freezing order to prevent the dissipation of assets while pursuing substantive claims in foreign proceedings. The application for interim relief was initially met with resistance in the Court of First Instance, which expressed concerns regarding the jurisdictional reach of the DIFC Courts under the recently enacted DIFC Court Law No. 2 of 2025.
The procedural history of the application highlights the urgency of the Appellants' request. As noted in the record:
Also on 11 April 2025, the Appellants filed an application under Part 25 of the DIFC Rules dealing with Interim Remedies and Security for Costs. It was an application for a freezing order under RDC Part 25.1(6) and a disclosure order under RDC Part 25.1(7).
The Appellants argued that the Respondents were actively dealing with assets in a manner that would frustrate any eventual recovery. By seeking a freezing order and a corresponding disclosure order, the Appellants aimed to secure the status quo, ensuring that the Respondents' assets remained available within the UAE to satisfy potential future judgments or awards.
Which judges presided over the Court of Appeal hearing on 13 June 2025 regarding the Nadil and Noshaba application?
The appeal was heard by a distinguished panel of the DIFC Court of Appeal, comprising H.E. Chief Justice Wayne Martin, H.E. Justice Robert French, and H.E. Justice Sir Peter Gross. The order was issued on 13 June 2025 following an ex parte hearing, reflecting the court's assessment of the necessity for immediate interim relief to prevent the potential dissipation of the Respondents' assets.
What specific legal arguments did Stephenson Harwood Middle East LLP advance on behalf of the Appellants regarding the Court's jurisdiction?
Stephenson Harwood Middle East LLP, representing the Appellants, argued that the DIFC Courts possess the inherent and statutory authority to grant interim relief in support of foreign proceedings. Counsel emphasized that the absence of a final judgment in the foreign jurisdiction did not preclude the DIFC Court from exercising its protective jurisdiction. They relied heavily on the principle that the Court must be able to prevent the frustration of justice by ensuring that assets located within the UAE are not dissipated before a claim can be adjudicated.
The Appellants contended that the jurisdictional basis was grounded in the broad interpretation of the Court's powers under the new legislative framework. They specifically pointed to the catch-all provisions within the DIFC Court Law, arguing that the Court’s jurisdiction extends to:
Claims and applications over which the DIFC Courts have jurisdiction under the DIFC Laws, DIFC Regulations, and the legislation in force in the Emirate, as well as any international treaty and convention to which the State has acceded or is a party to."
By framing the application as a necessary exercise of the Court's supervisory role, the Appellants successfully persuaded the Court of Appeal that the lower court’s initial refusal was overly restrictive.
What was the precise doctrinal issue the Court of Appeal had to resolve regarding the interpretation of the DIFC Court Law No. 2 of 2025?
The central legal question was whether the DIFC Court of Appeal could establish a "reasonably arguable case" for jurisdiction to grant a freezing order in support of foreign proceedings under the new DIFC Court Law No. 2 of 2025. The Court had to determine if the statutory language in Article 14(A)(7) and Article 15 of the 2025 Law provided a sufficient nexus to justify the exercise of the Court’s discretion, particularly when the underlying substantive dispute was being litigated outside the DIFC.
The Court was required to reconcile the restrictive interpretation adopted by the Court of First Instance with the broader, purposive approach advocated by the Appellants. The doctrinal tension lay in whether the Court’s jurisdiction to grant interim relief is strictly tethered to the existence of a substantive claim within the DIFC, or whether it extends to providing auxiliary support for foreign litigation where the assets are located within the jurisdiction.
How did the Court of Appeal apply the test for interim relief to reach its decision on the existence of jurisdiction?
The Court of Appeal applied a threshold test, determining that the Appellants only needed to demonstrate a "reasonably arguable case" for jurisdiction at the ex parte stage. The judges reasoned that the freezing order was a protective measure, not a final determination on the merits of the jurisdictional challenge. By adopting this standard, the Court ensured that the Appellants were not denied relief due to the complexity of the new legislative framework before the Respondents had even been heard.
The Court’s reasoning was anchored in the necessity of the order to prevent the frustration of potential future enforcement. As stated in the judgment:
Following an ex parte hearing, this Court granted the freezing order on the basis that there was at least a reasonably arguable case for the existence of the jurisdiction.
The Court further clarified that the Respondents were not left without recourse, as they retained the right to challenge the jurisdictional basis at a return date. This approach balanced the need for immediate protection of assets with the principles of procedural fairness and the right of the Respondents to contest the Court's authority.
Which specific statutes and rules of court were central to the Court’s analysis of its jurisdictional powers?
The Court’s analysis was primarily governed by the DIFC Court Law No. 2 of 2025, specifically Article 14(A)(7) (regarding the Court's jurisdiction over applications), Article 15 (general powers), and Article 31(4). Additionally, the Court referenced the Judicial Authority Law No. 12 of 2004, specifically Article 5 and Article 7(6), which define the broader jurisdictional reach of the DIFC Courts within the Emirate of Dubai.
The procedural application was governed by the Rules of the DIFC Courts (RDC), particularly:
- RDC Part 25.1(6): The power to grant a freezing order.
- RDC Part 25.1(7): The power to grant a disclosure order.
- RDC Part 25.10: Requirements for applications made without notice.
- RDC Part 25.13(3): Requirements for notifying the respondent in interim relief applications.
How did the Court of Appeal utilize the precedent set in Carmon Reestrutura v Cuenda [2024] DIFC CA 003?
The Court of Appeal relied on Carmon Reestrutura v Cuenda [2024] DIFC CA 003 to reinforce its authority to grant interim remedies. The Appellants successfully argued that the Carmon decision established a clear precedent that the DIFC Court has the power to grant freezing orders that extend to assets located both within and outside the jurisdiction.
The Court cited the finding in Carmon at [202] to support the proposition that:
Has power to grant interim remedies under Part 25 of the RDC including freezing orders which extend to freezing orders restraining a party from dealing with any assets whether located within the jurisdiction or not - RDC 25.1(6).
By integrating this precedent, the Court of Appeal confirmed that the transition to the 2025 legislative framework did not strip the Court of its established powers to provide effective interim relief, provided the jurisdictional threshold is met.
What was the final disposition of the Court of Appeal, and what specific orders were made against the Respondents?
The Court of Appeal granted the freezing order on an ex parte basis, effectively restraining the First Respondent from removing, disposing of, or diminishing the value of assets within the UAE. The Second Respondent was similarly subject to an injunction regarding specific assets detailed in a confidential schedule. The Court also ordered the First Respondent to provide detailed information regarding his assets exceeding USD 65,000, including bank statements and account details, within a specified timeframe.
The order included a penal notice, warning the Respondents that disobedience could lead to contempt of court, fines, or the seizure of assets. The Court scheduled a return date for a further hearing before the Court of First Instance, where the Respondents would have the liberty to apply to vary or discharge the order. Costs were reserved for future determination.
What are the wider implications of this decision for practitioners seeking interim relief in the DIFC?
This decision provides significant clarity for practitioners navigating the new 2025 legislative framework. It confirms that the DIFC Courts remain a viable forum for seeking interim relief in support of foreign proceedings, provided the applicant can establish a "reasonably arguable case" for jurisdiction. Practitioners should be prepared to demonstrate that the application falls within the broad scope of the Court’s powers under the new Law, while ensuring strict compliance with RDC Part 25 requirements regarding notice and disclosure.
The ruling serves as a reminder that the DIFC Courts will prioritize the protection of assets where there is a risk of dissipation, even when the underlying litigation is situated elsewhere. Future litigants should anticipate that while the Court is willing to grant ex parte relief, the "reasonably arguable" threshold will be rigorously tested at the return date, necessitating robust evidence of both the jurisdictional nexus and the risk of asset dissipation.
Where can I read the full judgment in Nadil v Nameer [2025] DIFC CA 001?
The full text of the order can be accessed via the DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/court-appeal/1-nadil-2-noshaba-v-1-nameer-2-naseema-1
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| Carmon Reestrutura v Cuenda | [2024] DIFC CA 003 | Cited to confirm the Court's power to grant freezing orders under RDC Part 25. |
Legislation referenced:
- DIFC Court Law No (2) of 2025 Article 14(A)(7)
- DIFC Court Law No (2) of 2025 Article 15
- DIFC Court Law No (2) of 2025 Article 31(4)
- Judicial Authority Law No 12 of 2004 Article 5
- Judicial Authority Law No 12 of 2004 Article 7(6)
- RDC Part 25.1(6)
- RDC Part 25.1(7)
- RDC Part 25.8
- RDC Part 25.10
- RDC Part 25.13(3)