BHM CAPITAL FINANCIAL SERVICES v 3IQ CORPORATION [2024] DIFC CFI 002 — Procedural extension for ADR (18 April 2024)

This consent order formalizes a temporary suspension of litigation in CFI 002/2024 to facilitate ongoing settlement negotiations between the parties.

What is the nature of the dispute between BHM Capital Financial Services and 3iQ Corporation in CFI 002/2024?

The litigation involves BHM Capital Financial Services PSC as the Claimant and 3iQ Corporation as the Defendant. While the specific underlying commercial dispute remains confidential, the matter is currently before the DIFC Court of First Instance under case number CFI 002/2024. The parties have sought the court's intervention to manage the procedural timeline while they attempt to resolve their differences outside of the courtroom.

The current status of the case is defined by a mutual agreement to pause active litigation. As noted in the court's recent directive: "The stay of proceedings in CFI-002-2024 shall be extended to 24 April 2024 to allow the parties to engage in alternative dispute resolution." This indicates that the parties are actively pursuing mediation or other forms of ADR to avoid a full trial. This order follows a previous procedural adjustment, as seen in BHM CAPITAL FINANCIAL SERVICES v 3IQ CORPORATION [2024] DIFC CFI 002 — Procedural extension by consent (07 March 2024), which highlights the court's willingness to accommodate party-led settlement efforts.

Which judge presided over the issuance of the consent order in CFI 002/2024 on 18 April 2024?

The consent order was issued by Assistant Registrar Hayley Norton, sitting in the Court of First Instance of the Dubai International Financial Centre Courts. The order was formally issued on 18 April 2024 at 10:00 am, reflecting the court's ongoing supervision of the case timeline.

What were the respective positions of BHM Capital Financial Services and 3iQ Corporation regarding the stay of proceedings?

Both BHM Capital Financial Services PSC and 3iQ Corporation adopted a collaborative stance, requesting that the court grant a stay of proceedings. By jointly approaching the court, the parties signaled that they have reached a consensus on the necessity of a "cooling-off" period to explore settlement options. This joint application effectively removes the immediate pressure of litigation deadlines, allowing both sides to focus their resources on ADR rather than the preparation of pleadings.

The Defendant, 3iQ Corporation, specifically required an adjustment to the procedural timetable to accommodate this stay. By agreeing to the extension, the Claimant, BHM Capital Financial Services, has effectively consented to defer the filing of the Defence, thereby avoiding the costs and procedural friction associated with contested applications for extensions of time.

What was the precise procedural question the court had to resolve regarding the timeline for the Defence in CFI 002/2024?

The court was tasked with determining whether to grant a formal extension for the filing of the Defence in light of the parties' ongoing ADR efforts. The central issue was how to balance the court's interest in the efficient progression of cases with the parties' desire to settle the matter privately. The court had to decide on a specific date that would allow sufficient time for ADR to conclude without indefinitely delaying the litigation process.

How did Assistant Registrar Hayley Norton justify the extension of the stay of proceedings?

The Assistant Registrar exercised the court's inherent power to manage its docket by formalizing the agreement reached by the parties. The reasoning is rooted in the principle that the court should facilitate, rather than hinder, the resolution of disputes through alternative means. By granting the extension, the court ensures that the parties are not forced into a premature adversarial posture while a settlement remains a viable possibility.

The court's decision is explicitly framed by the parties' stated objective: "The stay of proceedings in CFI-002-2024 shall be extended to 24 April 2024 to allow the parties to engage in alternative dispute resolution." This approach reflects a standard judicial preference for party autonomy in the DIFC, provided that the procedural delays remain within reasonable bounds and are supported by both sides.

Which specific Rules of the DIFC Courts (RDC) govern the court's authority to grant a stay of proceedings by consent?

The court's authority to issue this order is derived from the Rules of the DIFC Courts (RDC), specifically those provisions that allow for the management of case timetables and the encouragement of ADR. While the order itself is a product of party consent, it is underpinned by the court's broad case management powers under RDC Part 4, which empowers the court to stay proceedings to facilitate settlement. Furthermore, the amendment of the deadline for the Defence is governed by RDC Part 23, which allows for the variation of time limits either by agreement or by court order.

How does the court's approach to ADR in CFI 002/2024 align with the broader DIFC judicial policy?

The DIFC Courts consistently promote the use of ADR as a primary mechanism for dispute resolution, viewing it as a way to reduce the burden on the judicial system and provide parties with more flexible outcomes. In this case, the court's willingness to grant multiple extensions—as evidenced by the history of CFI 002/2024—demonstrates a policy of supporting parties who are genuinely engaged in settlement negotiations. The court treats ADR not as a delay tactic, but as a legitimate procedural step that can lead to the final disposal of the case without the need for a full trial.

What was the final disposition of the order issued on 18 April 2024?

The court ordered that the stay of proceedings be extended until 24 April 2024. Additionally, the court set a new, firm deadline for the Defendant to file and serve their Defence by 4:00 pm on 3 May 2024. Regarding the financial implications of the application, the court ordered that the costs of the order shall be "costs in the case," meaning the liability for these costs will be determined at the final resolution of the litigation.

What should practitioners anticipate when seeking similar procedural extensions in the DIFC Court of First Instance?

Practitioners should note that the DIFC Court is highly receptive to consent orders that facilitate ADR, provided that the parties can demonstrate a clear timeline and a mutual commitment to the process. However, parties must be prepared to provide specific dates for the resumption of litigation, as the court is unlikely to grant indefinite stays. The use of "costs in the case" as a standard order for procedural applications of this nature serves to minimize satellite litigation over minor procedural costs, allowing parties to focus on the merits of the dispute.

Where can I read the full judgment in BHM CAPITAL FINANCIAL SERVICES v 3IQ CORPORATION [2024] DIFC CFI 002?

The full text of the order is available on the DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/court-first-instance/cfi-0022024-bhm-capital-financial-services-psc-v-3iq-corporation-2. A copy is also archived at: https://littdb.sfo2.cdn.digitaloceanspaces.com/litt/AE/DIFC/judgments/court-first-instance/DIFC_CFI-002-2024_20240418.txt.

Cases referred to in this judgment:

Legislation referenced:

• Rules of the DIFC Courts (RDC) Part 4 (Case Management)
• Rules of the DIFC Courts (RDC) Part 23 (Applications for Court Orders)