This order addresses the finalization of costs liability following the court’s decision to permit the Claimant to amend his Particulars of Claim in a commercial dispute involving RAG Foodstuff Trading LLC.
What was the specific nature of the dispute between Ilyas Gaffar Saboowala and the respondents Soman Kuniyat Kunjunni Nair, Mini Soman Thoruvil Veluthedath, and RAG Foodstuff Trading LLC?
The litigation, filed under case number CFI-037-2017, involves a commercial dispute brought by the Claimant, Ilyas Gaffar Saboowala, against three defendants: Soman Kuniyat Kunjunni Nair, Mini Soman Thoruvil Veluthedath, and the entity RAG Foodstuff Trading LLC. While the underlying substantive claims relate to the business operations of the foodstuff trading company, the specific procedural juncture addressed in the 13 March 2018 order concerns the Claimant’s application to amend his Particulars of Claim.
The court had previously issued an Order with Reasons on 15 February 2018, which granted the Claimant permission to alter his pleadings. The subsequent order dated 13 March 2018 was issued to formalize the financial consequences of this amendment. As noted in the court's directive regarding the allocation of legal expenses:
Subject to consideration of any submission by the Defendants on or before 19 March 2018, the Claimant does pay the Defendants’ costs of the application to amend, including costs incurred in relation to the Order, such costs to be subject to immediate assessment pursuant to Rule 33.30 of the Rules of the DIFC Courts .
The dispute highlights the court's strict approach to managing the costs burden when a party seeks to shift the goalposts of a claim mid-litigation. The full text of the order can be accessed via the DIFC Courts website.
Which judge presided over the order in CFI-037-2017 and in which division of the DIFC Courts was this matter heard?
This matter was heard by Deputy Chief Justice Sir David Steel. The proceedings were conducted within the Court of First Instance, which maintains jurisdiction over civil and commercial disputes within the Dubai International Financial Centre. The order was formally issued on 13 March 2018, following the court's earlier review of the parties' submissions as mandated by the preceding order of 15 February 2018.
What were the positions of Ilyas Gaffar Saboowala and the defendants regarding the costs of the amendment application?
The Claimant, Ilyas Gaffar Saboowala, sought the court's leave to amend his Particulars of Claim, a request that necessitated a formal application process. The Defendants, Soman Kuniyat Kunjunni Nair, Mini Soman Thoruvil Veluthedath, and RAG Foodstuff Trading LLC, were required to respond to this application.
The court’s position, as reflected in the final order, was that while the amendments were permissible, the Claimant must bear the financial burden of the procedural disruption caused by his request. The Defendants were granted the right to make submissions regarding the quantum of these costs, with the court setting a deadline of 19 March 2018 for such filings. The legal argument centered on the principle that the party seeking to amend their case should indemnify the opposing party for the costs occasioned by that amendment, preventing the Defendants from being unfairly prejudiced by the Claimant’s evolving case theory.
What was the specific legal question regarding the assessment of costs that Deputy Chief Justice Sir David Steel had to resolve?
The primary legal question before the court was whether the costs associated with the Claimant's application to amend his Particulars of Claim should be subject to immediate assessment, and whether the Claimant should be held solely liable for those costs. The court had to determine if the standard practice of deferring costs to the conclusion of the trial was appropriate, or if the circumstances warranted an immediate assessment under the Rules of the DIFC Courts (RDC).
By invoking RDC 33.30, the court addressed the procedural mechanism for determining the exact amount of costs owed by the Claimant to the Defendants. The court had to ensure that the Defendants were fully compensated for the legal work necessitated by the amendment, including costs incurred in relation to the 15 February 2018 Order, without waiting for the final resolution of the substantive claims.
How did Deputy Chief Justice Sir David Steel apply the doctrine of costs follow the event in the context of the amendment application?
The judge applied the principle that a party seeking to amend their pleadings must indemnify the other side for the costs incurred as a result of that amendment. By granting the amendment on the condition that the Claimant pays the costs of and occasioned by the amendments, the court ensured that the Defendants were not out of pocket for the Claimant's procedural changes.
The reasoning process involved a two-step approach: first, confirming the permission to amend, and second, enforcing the immediate assessment of costs. The court explicitly linked the costs to the application itself and the previous Order. As stated in the order:
Subject to consideration of any submission by the Defendants on or before 19 March 2018, the Claimant does pay the Defendants’ costs of the application to amend, including costs incurred in relation to the Order, such costs to be subject to immediate assessment pursuant to Rule 33.30 of the Rules of the DIFC Courts .
This reasoning ensures that the court’s resources are not tied up in prolonged disputes over minor procedural costs, while simultaneously protecting the Defendants' right to recover expenses incurred due to the Claimant's shift in legal strategy.
Which specific Rules of the DIFC Courts were applied to determine the assessment of costs in this matter?
The court relied specifically on Rule 33.30 of the Rules of the DIFC Courts (RDC). This rule provides the framework for the immediate assessment of costs. By ordering that the costs be subject to "immediate assessment pursuant to Rule 33.30," the court bypassed the need for a lengthy, separate costs-taxation process at the end of the trial, allowing the Defendants to recover their legal fees in a more expedited manner.
How does the application of RDC 33.30 in this case align with the DIFC Courts' approach to procedural efficiency?
The court utilized RDC 33.30 as a tool for procedural efficiency, ensuring that the costs of the amendment application were dealt with definitively. By ordering immediate assessment, the court prevented the accumulation of "costs on costs" and ensured that the litigation remained focused on the substantive issues rather than becoming bogged down in ancillary disputes over procedural expenses. This aligns with the broader DIFC Courts' objective of maintaining a streamlined and cost-effective forum for commercial dispute resolution.
What was the final disposition and the specific orders made by the court regarding the Claimant's liability?
The court allowed the Claimant's amendments to the Particulars of Claim, but this permission was strictly conditional. The Claimant was ordered to pay the Defendants’ costs of the application to amend, as well as costs incurred in relation to the 15 February 2018 Order. The court provided the Defendants until 19 March 2018 to file submissions regarding these costs, after which the costs would be subject to immediate assessment under RDC 33.30.
What are the wider implications for litigants in the DIFC regarding the amendment of pleadings?
This case serves as a clear warning to litigants that amendments to pleadings are not cost-neutral. Practitioners must anticipate that any application to amend will likely result in an order for costs against the applicant, regardless of the ultimate success of the underlying claim. The use of immediate assessment under RDC 33.30 means that these costs must be paid promptly, rather than being deferred to the final judgment. Litigants must therefore carefully consider the necessity of amendments before filing, as the financial consequences are immediate and enforceable.
Where can I read the full judgment in ILYAS GAFFAR SABOOWALA v SOMAN KUNIYATH KUNJUNNI NAIR [2018] DIFC CFI 037?
The full order can be read on the DIFC Courts website at: https://www.difccourts.ae/rules-decisions/judgments-orders/court-first-instance/cfi-0372017-ilyas-gaffar-saboowala-v-1-soman-kuniyat-kunjunni-nair-2-mini-soman-thoruvil-veluthedath-3-rag-foodstuff-trading-llc-2 or via the CDN link: https://littdb.sfo2.cdn.digitaloceanspaces.com/litt/AE/DIFC/judgments/court-first-instance/DIFC_CFI-037-2017_20180313.txt.
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| N/A | N/A | N/A |
Legislation referenced:
- Rules of the DIFC Courts (RDC): Rule 33.30