What were the specific grounds for the 3.6 million euro debt claim brought by EFG against Marj Holding and Mohammad Ahmad Ramadhan Juma?
The dispute centers on a series of financial agreements between the Claimants, EFG (Middle East) Ltd and EFG Bank Ltd, and the Respondents, Marj Holding Limited, Arj Holding Limited, and Mr. Mohammad Ahmad Ramadhan Juma. The Claimants initiated proceedings to recover approximately 3.6 million euros, alleging a default under a complex web of credit arrangements. These included a DIFC agreement dated 6 January 2022 for the arrangement of loans, a Lombard Credit Framework agreement, and a subsequent credit agreement dated 7 April 2022.
The liability was further underpinned by a personal guarantee provided by Mr. Juma and a supplementary agreement dated 3 November 2023. Following a margin call that remained unsatisfied, the Claimants sought and obtained an ex parte worldwide freezing injunction on 10 March 2025. The Claimants characterized the matter as a "straightforward debt claim" in the affidavit of their CEO, Mr. Ali Sandali. However, the subsequent litigation revealed significant procedural failures in how this claim was presented to the Court, leading to the eventual collapse of the initial injunctive relief.
Which judge presided over the CFI 029/2025 proceedings and when were the key hearings conducted?
The matter was heard before H.E. Justice Roger Stewart in the DIFC Court of First Instance. The procedural history of the case involved multiple critical dates, beginning with the initial ex parte application on 10 March 2025. Following the Respondents' challenge, a significant hearing took place on 23 May 2025 to address the order of proceedings, specifically the tension between the Defendants' discharge application and the Claimants' contempt allegations. The final reasons for the order were handed down on 27 August 2025, following a hearing on 12 May 2025 where the Respondents introduced detailed arguments regarding non-disclosure.
How did Ms. Bijlani and Mr. Fear-Segal frame their respective arguments regarding the validity of the freezing injunction?
Ms. Bijlani, representing the Claimants, argued that the Court should prioritize the contempt applications, asserting that the Respondents should be barred from being heard until they had purged their alleged contempt. She maintained that the freezing order was necessary to protect the 3.6 million euro debt and that the Respondents had failed to comply with disclosure requirements.
Conversely, Mr. Fear-Segal, appearing for the Respondents, challenged the very foundation of the injunction. He argued that the Claimants had failed in their duty of full and frank disclosure, noting that the initial application lacked the conventional section addressing such duties. Mr. Fear-Segal introduced a series of detailed points regarding non-disclosure that had not been previously signaled, effectively shifting the focus from the debt itself to the procedural impropriety of the Claimants' ex parte application.
What was the jurisdictional issue the Court had to resolve regarding the Respondents' challenge to the freezing order?
The Court was tasked with determining whether the Respondents' challenge to the freezing order was procedurally sound and whether the Claimants had satisfied the threshold for maintaining an ex parte injunction. A central doctrinal issue was whether the Claimants’ failure to provide full and frank disclosure—specifically regarding the non-standard form of the order and potential jurisdictional nuances—vitiated the injunction from its inception. The Court had to balance the Claimants' right to seek security for their debt against the Respondents' right to a fair process, particularly where the Claimants had assured the Court during the initial hearing that the order was in standard form when it was not.
How did Justice Roger Stewart apply the doctrine of full and frank disclosure to the Claimants' conduct?
Justice Stewart emphasized that the duty of full and frank disclosure is absolute in ex parte applications. He noted that the Claimants' skeleton argument and affidavit were conspicuously silent on this duty, a point he highlighted as a significant failure. The Court found that the Claimants had misled the Court by confirming the order was in standard form when it contained non-standard provisions.
It follows that in my view there is no doubt at all, but that the injunction which I granted on 10 March 2025 should be set aside.
The judge observed that the Respondents' application to discharge, supported by Mr. Juma’s fifth affidavit, correctly identified that the Claimants had failed to provide the necessary transparency. The Court rejected the Claimants' attempt to prioritize contempt proceedings, finding it inappropriate to enforce an order that should never have been granted in its original form due to these procedural lapses.
Which statutes and rules governed the Court's assessment of the freezing injunction and the subsequent contempt findings?
The Court’s analysis was governed by the Rules of the DIFC Courts (RDC), specifically those pertaining to the requirements for ex parte applications and the duty of disclosure. The Court relied on the principles established in Tugushev v Orlov [2019] EWHC 2031 regarding the standard of disclosure required in freezing injunctions. The Court also applied its inherent jurisdiction to manage its own process, particularly in relation to the contempt application against Mr. Juma. The assessment of costs was governed by the RDC provisions on indemnity costs, which the Court applied to reflect the Respondents' success in discharging the injunction.
How did the Court utilize the precedent of Tugushev v Orlov in its reasoning?
The Court utilized Tugushev v Orlov to underscore the gravity of the duty of full and frank disclosure. By citing this authority, Justice Stewart reinforced that the failure to disclose material facts—or the misrepresentation of the nature of an order—is not a mere technicality but a fundamental breach that warrants the discharge of an injunction. The Court used this precedent to distinguish between the Claimants' "straightforward debt claim" narrative and the reality of the procedural shortcuts taken, ultimately holding that the Claimants could not benefit from an order obtained through such non-disclosure.
What was the final disposition of the Court regarding the freezing injunction, the default judgment, and the contempt fine?
The Court ordered the immediate discharge of the worldwide freezing injunction. Regarding the Claimants' request for a default judgment, the Court refused the application, noting that the Respondents would be permitted to file a defense. Furthermore, the Court addressed the contempt of court allegation against Mr. Juma, finding that a financial penalty was the appropriate remedy for his failure to comply with the disclosure requirements of the original order.
In the circumstances of this case, I consider it appropriate to order that Mr. Juma pay a fine of USD25,000 in relation to his Contempt of Court and that in the circumstances of this case that adequately meets the provision.
The Court also addressed the allocation of costs, ruling that the Respondents were entitled to their costs for the discharge application on an indemnity basis, while the Claimants were entitled to costs regarding the contempt issue.
How does this judgment impact future practice regarding ex parte applications in the DIFC?
This ruling serves as a stern warning to practitioners that the DIFC Courts will not tolerate "cut-and-paste" ex parte applications that omit the mandatory section on full and frank disclosure. The decision highlights that the Court will actively scrutinize the "standard form" status of orders and will not hesitate to discharge injunctions if the applicant has failed to be transparent. Practitioners must now anticipate that any failure to disclose jurisdictional issues or non-standard provisions will result in the immediate discharge of the order and potential indemnity cost orders against their clients.
Where can I read the full judgment in EFG v Marj Holding [2025] DIFC CFI 029?
The full judgment is available on the DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/court-first-instance/cfi-0292025-1-efg-middle-east-ltd-2-efg-bank-ltd-v-1-marj-holding-limited-2-arj-holding-limited-3-mohammad-ahmad-ramadhan-juma-1
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| Tugushev v Orlov | [2019] EWHC 2031 | Standard for full and frank disclosure |
Legislation referenced:
- Rules of the DIFC Courts (RDC)
- DIFC Court Law (General provisions on contempt and injunctive relief)