This order clarifies the strict necessity for alignment between a party’s bill of costs and the specific underlying court order, reinforcing that a Default Costs Certificate cannot be used to circumvent an adverse costs ruling.
Why did Belsons Innovations Technologies file a Notice of Commencement of Assessment of Bill of Costs for USD 6,000 in CFI 020/2023?
The dispute centers on a procedural misstep by the Defendant, Belsons Innovations Technologies, following an adverse ruling regarding two specific applications: the Permission to Appeal (PTA) Application and the Unless and Sanctions Application. Despite the court having previously ordered the Defendant to pay the Claimant’s costs for these matters, the Defendant sought to recover its own legal expenses.
The NOC and accompanying Statement of Costs dated 23 December 2024 sets out the Defendant’s claimed costs to be in the sum of USD 6,000 (the “Claimed Costs”).
The Defendant initiated the formal assessment process by filing the necessary documentation to trigger the recovery of these funds.
On 26 December 2024, the Defendant filed a Notice of Commencement of Assessment of Bill of Costs (the “NOC”).
The Claimant, Muzoon Holding, was effectively forced into a position where the Defendant was attempting to recover costs that the court had already determined were the Defendant's own liability to pay to the Claimant. The filing of the NOC was the first step in a failed attempt to convert these non-recoverable expenses into a judgment debt through the assessment process.
Which judge presided over the dismissal of the Default Costs Certificate request in the DIFC Court of First Instance on 5 February 2025?
Assistant Registrar Hayley Norton presided over this matter within the Court of First Instance. The order was issued on 5 February 2025, following a review of the procedural history of CFI 020/2023, specifically focusing on the discrepancy between the Defendant’s request and the prior directions issued by Justice Lord Angus Glennie.
What were the specific legal positions of Muzoon Holding and Belsons Innovations Technologies regarding the costs of the PTA and Unless and Sanctions applications?
The Defendant, Belsons Innovations Technologies, adopted the position that it was entitled to recover USD 6,000 in costs associated with the PTA Application and the Unless and Sanctions Application. By filing the Request for a Default Costs Certificate on 22 January 2025, the Defendant signaled its intent to finalize this recovery without the Claimant’s agreement.
On 22 January 2025, the Defendant filed a request for a Default Costs Certificate (the “Request”).
Conversely, the Claimant’s position—supported by the clear language of the 9 December 2024 Order—was that the Defendant was the paying party, not the receiving party. The Claimant relied upon the explicit directions of Justice Lord Angus Glennie, which mandated that the Defendant bear the financial burden of these applications. The Defendant’s attempt to flip the script and claim these costs for itself lacked any foundation in the court’s previous substantive orders.
What was the precise doctrinal issue the court had to resolve regarding the validity of the Defendant’s Request for a Default Costs Certificate?
The court had to determine whether a party can obtain a Default Costs Certificate under the Rules of the DIFC Courts (RDC) when the underlying order does not actually grant that party an entitlement to costs. The jurisdictional and procedural question was whether the Registrar has the authority to grant a certificate when the application is fundamentally inconsistent with the substantive order governing the litigation. The court essentially had to decide if the procedural mechanism of a Default Costs Certificate could be used to override a prior judicial determination on costs liability.
How did Assistant Registrar Hayley Norton apply the doctrine of judicial consistency to reject the Defendant’s claim for costs?
The Assistant Registrar performed a direct comparison between the Defendant’s filing and the specific language contained in the Order of Justice Lord Angus Glennie dated 9 December 2024. The reasoning was straightforward: the court’s authority to award costs is derived from the substantive order, and where that order explicitly assigns liability to the Defendant, the Defendant cannot unilaterally claim those costs as its own.
Having reviewed the Order, I find that it does not entitle the Defendant to its costs of the PTA Application or the Unless and Sanctions Application (the “Applications”).
The Assistant Registrar emphasized that the Defendant’s request was not merely procedurally flawed but substantively contradictory to the court's prior mandate.
To the contrary, the Order directs that the Defendant pay the Claimant’s costs of the Applications, to be assessed, if not agreed.
By identifying this contradiction, the court concluded that the Defendant had no legal basis to initiate the assessment process for these specific costs.
Which specific sections of the Order of Justice Lord Angus Glennie were cited to invalidate the Defendant’s claim?
The Assistant Registrar relied on the explicit terms of the 9 December 2024 Order. Regarding the PTA Application, the court cited the following:
The Defendant is to pay the Claimant costs for the PTA Application, to be assessed by the Registrar if not agreed by the parties.
Furthermore, regarding the Unless and Sanctions Application, the court referenced the specific directive:
The Defendant shall pay the Claimant’s costs for the Unless and Sanctions Application, to be assessed by the Registrar if not agreed by the parties .” (emphasis added)
These provisions served as the primary authority for the Assistant Registrar’s decision to dismiss the Defendant’s request, as they directly contradicted the Defendant's assertion of entitlement.
How did the court interpret the interplay between the RDC assessment process and the substantive costs orders?
The court treated the substantive order as the "source of truth" for any subsequent costs assessment. Under the RDC, the assessment process is a mechanism to quantify costs that have already been awarded in principle. The court’s reasoning confirms that a party cannot use the RDC assessment rules to create a new right to costs that was not granted in the underlying judgment or order. The Assistant Registrar’s decision reinforces that the Registrar’s role in assessing costs is strictly limited to the scope of the original order.
What was the final disposition of the Request for a Default Costs Certificate and the associated costs of that application?
The court dismissed the Defendant’s request in its entirety, effectively halting the attempt to recover the USD 6,000.
As the Defendant has failed to provide any basis for which it is entitled to its Claimed Costs, the Request must be dismissed.
In addition to the dismissal, the court ordered that the Defendant bear its own costs for the failed Request. This ensures that the Claimant is not further burdened by the Defendant’s erroneous procedural filings.
What are the practical implications for DIFC practitioners regarding the filing of Default Costs Certificates?
This case serves as a warning to practitioners that the DIFC Courts will strictly scrutinize the underlying basis for any costs claim. Before filing a Notice of Commencement of Assessment or a Request for a Default Costs Certificate, practitioners must ensure that the substantive order explicitly entitles their client to the costs being claimed. Attempting to use procedural mechanisms to recover costs that were, in fact, awarded against one’s own client will result in summary dismissal and the imposition of further costs on the applicant. Practitioners should conduct a rigorous audit of all prior orders before initiating the assessment process to avoid similar outcomes.
Where can I read the full judgment in Muzoon Holding LLC v Belsons Innovations Technologies LLC [2025] DIFC CFI 020?
The full order can be accessed via the official DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/court-first-instance/cfi-0202023-muzoon-holding-llc-v-belsons-innovations-technologies-llc-2
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| Muzoon Holding LLC v Belsons Innovations Technologies LLC | CFI 020/2023 | Underlying substantive matter |
Legislation referenced:
- Rules of the DIFC Courts (RDC)
- Order of Justice Lord Angus Glennie (9 December 2024)