What was the nature of the investment dispute between Alawwal Capital JSC and Rasmala Investment Bank Limited that led to a USD 4,199,519.22 claim?
The dispute arose from Alawwal Capital JSC’s investment of over USD 10 million into the Rasmala Trade Finance Fund, an open-ended investment vehicle managed by Rasmala Investment Bank Limited (RIBL). Alawwal, a Saudi-based investment bank, sought to align its own multi-asset fund with a "low to medium risk" profile. Following the suspension of the Rasmala Trade Finance Fund in March 2020, Alawwal suffered significant losses, leading it to initiate proceedings in the DIFC Courts. Alawwal alleged that it would not have committed capital to the Fund but for a series of negligent misrepresentations made by RIBL during negotiations between November 2018 and February 2019.
While the Trial Judge, H.E. Justice Roger Stewart KC, rejected the claim for breach of fiduciary duty, he upheld the claim for negligent misrepresentation. The resulting judgment ordered RIBL to compensate Alawwal for the losses sustained. As noted in the Court’s order:
None of the proposed grounds of appeal has any real prospect of success. The Renewed Application for Permission must be dismissed with costs. It follows that the Stay Application must also be dismissed, with costs (if any).
How did H.E. Chief Justice Wayne Martin handle the Renewed Application for Permission to Appeal in CFI 038/2023?
The Renewed Application for Permission to Appeal was heard by H.E. Chief Justice Wayne Martin, sitting in the Court of Appeal. Following the Trial Judge’s initial refusal of permission to appeal on 13 August 2025, RIBL filed a renewed application on 1 September 2025. Chief Justice Martin delivered his Order with Reasons on 15 October 2025, effectively concluding the appellate review process for this stage of the litigation by dismissing the application on the papers.
What specific legal arguments did Rasmala Investment Bank advance in its attempt to overturn the trial judgment?
RIBL sought to challenge the findings of the Trial Judge by arguing that the court had erred in its assessment of the evidence regarding the timeline of the investment decision. Specifically, RIBL contended that the Trial Judge’s factual findings were inconsistent with the evidence presented at trial. RIBL attempted to argue that a "settled conclusion" to invest had been reached by Alawwal as early as 2 January 2019, which would have undermined the causal link between the alleged misrepresentations and the investment decision.
In response, Alawwal maintained that the Trial Judge correctly assessed the evidence, including the contemporaneous documents and witness testimony. The Claimant argued that RIBL’s grounds of appeal were merely an attempt to re-litigate factual findings that were well-supported by the trial record. The Chief Justice found no merit in RIBL’s position, explicitly stating:
I reject the suggestion that a settled conclusion had been made to invest in the Fund by 2 January 2019.”
What was the precise doctrinal question regarding the standard of review for factual findings that the Court of Appeal had to answer?
The central legal question was whether the Trial Judge’s findings of fact—specifically regarding the timing of the investment decision and the nature of the representations made—were "plainly wrong" or otherwise susceptible to appellate interference. The Court had to determine if RIBL had met the high threshold required to disturb a trial judge’s findings, particularly when those findings were based on the evaluation of witness evidence and contemporaneous documentation. The Court focused on whether the Trial Judge had correctly applied the principles governing negligent misrepresentation under the DIFC Law of Obligations, specifically whether there were reasonable grounds for the opinions expressed by RIBL during the negotiation phase.
How did the Chief Justice apply the "plainly wrong" test to the Trial Judge’s assessment of the evidence?
Chief Justice Martin applied the established appellate doctrine that a trial judge’s findings of fact are entitled to significant deference, especially when the judge has had the benefit of hearing the witnesses testify. The Chief Justice emphasized that an appellate court will not interfere with such findings unless the trial judge is shown to be "plainly wrong." In evaluating the grounds of appeal, the Chief Justice conducted a thorough review of the Amended Particulars of Claim to determine if the trial judge’s reasoning was soundly based on the pleadings and the evidence.
The Chief Justice highlighted the necessity of this analysis:
Because of the nature of some of the grounds of appeal it is necessary to analyse relevant aspects of Alawwal’s pleaded case as contained in its Amended Particulars of Claim (the “Particulars”).
By reviewing the trial record, the Chief Justice concluded that the Trial Judge had correctly identified that the core issue was whether RIBL had reasonable grounds for its expressed opinions, rather than whether it had acted with dishonesty.
Which specific DIFC statutes and rules governed the Court’s decision to dismiss the appeal?
The Court’s decision was anchored in the DIFC Law of Obligations, specifically Articles 10, 18, and 20, which govern the standards for negligent misrepresentation and the duties of parties in commercial negotiations. Additionally, the Court relied upon the DIFC Law No. 5 of 2005 (Collective Investment Law), specifically Articles 17, 20, and 21, which regulate the conduct of investment banks and the management of collective investment schemes. Procedurally, the Court exercised its powers under the Rules of the DIFC Courts (RDC), specifically RDC 44.5, 44.117, and 44.19, which outline the criteria for granting permission to appeal and the management of stay applications.
How did the Court utilize English case law precedents to inform its appellate reasoning?
The Court relied on the principles established in Gestmin SGPSA v Credit Suisse Ltd [2013] EWHC 3650 (Comm) and Henderson v Foxworth Investments Limited to guide its approach to factual findings. Gestmin was used to reinforce the importance of relying on contemporaneous documents over the fallible memory of witnesses in commercial disputes. Henderson was cited to confirm the appellate court’s limited role in reviewing findings of fact, emphasizing that an appellate court should not interfere unless the trial judge’s conclusion was one that no reasonable judge could have reached. These authorities supported the Chief Justice’s decision to uphold the Trial Judge’s findings, as they demonstrated that the Trial Judge had correctly prioritized objective evidence over the subjective assertions made by RIBL on appeal.
What was the final disposition of the Renewed Application and the associated costs orders?
The Court dismissed the Renewed Application for Permission to Appeal in its entirety. Consequently, the Stay Application filed by RIBL was also dismissed. The Court ordered RIBL to pay Alawwal’s costs for both the Renewed Application and the Stay Application. The Chief Justice directed a specific timeline for the assessment of these costs:
The Defendant shall pay the Claimant’s costs of the Renewed Application for Permission and the costs of the Stay Application (if any) to be assessed in accordance with the following directions.
Alawwal was ordered to file its Statement of Costs within 14 days, with RIBL given a further 14 days to respond, and Alawwal given 7 days to reply, after which the Chief Justice will conduct an immediate assessment on the papers.
What are the wider implications for DIFC practitioners regarding the threshold for appealing trial judgments?
This decision serves as a stern reminder that the DIFC Court of Appeal maintains a very high threshold for granting permission to appeal, particularly regarding findings of fact. Practitioners must anticipate that the Court will be highly reluctant to disturb a trial judge’s conclusions if those conclusions are supported by the evidence and the trial judge has properly applied the law. The case underscores that "negligent misrepresentation" claims in the DIFC are heavily fact-dependent, and the failure to establish a "real prospect of success" at the appellate stage will result in the summary dismissal of the application and the imposition of significant costs. Litigants should focus their trial strategies on robustly testing evidence at first instance, as the appellate route offers little opportunity for a second bite at the cherry.
Where can I read the full judgment in Alawwal Capital JSC v Rasmala Investment Bank Limited [2025] DIFC CFI 038?
The full judgment and the Order with Reasons can be accessed via the DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/court-first-instance/cfi-0382023-alawwal-capital-jsc-v-rasmala-investment-bank-limited-9 or via the CDN link: https://littdb.sfo2.cdn.digitaloceanspaces.com/litt/AE/DIFC/judgments/court-first-instance/DIFC_CFI-038-2023_20251015.txt.
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| Gestmin SGPSA v Credit Suisse Ltd | [2013] EWHC 3650 (Comm) | To emphasize the primacy of contemporaneous documents over witness memory. |
| Henderson v Foxworth Investments Limited | [2014] UKSC 41 | To define the high threshold for appellate interference with factual findings. |
Legislation referenced:
- DIFC Law of Obligations, Articles 10, 18, 20
- DIFC Law No 5 of 2005 (Collective Investment Law), Articles 17, 20, 21
- RDC 44.5, 44.117, 44.19