What was the nature of the dispute between Larmag Holding and the Third Defendant, Mr Abdullah Saeed Bakheet Obaid Aljaberi, in CFI 054/2019?
The lawsuit centered on a sophisticated fraud involving the misappropriation of financial assets. Larmag Holding B.V. initiated proceedings against several parties, including First Abu Dhabi Bank PJSC and Mr Abdullah Saeed Bakheet Obaid Aljaberi (D3), alleging that D3 fraudulently procured the transfer of 70,000 Reditum SA bonds, valued at approximately 1 million EUR, into his personal account. The Claimant asserted that D3 utilized forged documents from a reputable bank to deceive the Claimant into believing a 20 million EUR prepayment had been made.
Following a multi-day trial, the Court found in favor of the Claimant, determining that D3 had acted with grave dishonesty, provided false evidence, and remained in possession of the misappropriated bonds. The Court ordered the immediate transfer of the bonds back to the Claimant and imposed costs on an indemnity basis. As noted in the judgment:
Following a trial that lasted several days, the claims brought by the Claimant against D3 were upheld.
The present application concerned D3’s attempt to challenge the Court’s jurisdiction over him after the trial had already concluded against him. The source of this order can be found at the DIFC Courts website.
Which judge presided over the application for an extension of time to appeal in the Court of First Instance on 19 August 2022?
Justice Sir Richard Field presided over the application in the Court of First Instance. The order was issued on 19 August 2022, following the Third Defendant’s application (CFI-054-2019/16) dated 9 September 2021, which sought to extend the time to file an appeal against the substantive judgment delivered on 15 August 2021.
What arguments did BSA Ahmad Bin Hezeem & Associates advance for the Third Defendant, and how did the Claimant respond regarding the procedural failures?
Counsel for D3, BSA Ahmad Bin Hezeem & Associates, argued that the failure to file the appeal notice on time was a technical issue caused by the eRegistry portal. They contended that the Form P37/01 could not be loaded before the 4pm deadline on 5 September 2021, and that the delay was minimal, causing only "2 minutes" of prejudice to the Claimant. They further maintained that the appeal had a real prospect of success, specifically challenging the Court's jurisdiction over D3.
Conversely, the Claimant, represented by Clyde & Co, argued that the application was both abusive and procedurally deficient. They contended that D3 had waived any right to challenge jurisdiction by failing to file an application under RDC 12.5 at the outset of the proceedings. Furthermore, the Claimant highlighted that D3 had failed to comply with RDC 44.13, which requires the inclusion of the Appeal Notice in such applications, and that the "technical difficulties" were not a sufficient excuse for the breach.
Did the Court have jurisdiction to join the Third Defendant under RDC 20.7, and did the failure to dispute jurisdiction at the outset preclude the appeal?
The core doctrinal issue was whether D3 could challenge the Court's jurisdiction post-judgment after having participated in the trial without filing a timely jurisdictional challenge. The Court had to determine if the joinder of D3 under RDC 20.7 was validly executed and whether the failure to invoke RDC 12.5 at the Acknowledgement of Service stage (December 2019) acted as a permanent bar to raising jurisdictional objections.
How did Justice Sir Richard Field apply the test for an extension of time and the doctrine of waiver regarding jurisdiction?
Justice Sir Richard Field evaluated the application by weighing the procedural failures against the merits of the proposed appeal. He found that the attempt to reopen the jurisdictional question was fundamentally flawed because D3 had already submitted to the Court's authority. He emphasized that the joinder was validly predicated on the Court's existing jurisdiction over the First and Second Defendants. As stated in the judgment:
A joinder order under RDC 20.7 can only be made if the Court already has jurisdiction over the existing parties and this requirement was met in that the Court had ruled on 4 August 2019 that it had jurisdiction over the First and Second Defendants because they were “Licensed DIFC Establishments” for the purpose of Article 5(A)(1)(a) of the Judicial Authority Law, and this ruling was upheld by the DIFC Court of Appeal on 23 March 2020.
The Court further noted that the application was abusive under RDC 12.5:
I turn to the first ground advanced by the Claimant in support of its case that the EOT Application should be refused – the application is abusive by reason of the effect of RDC 12.5.
Ultimately, the Court concluded that the appeal was hopeless:
This is a powerful ground but, in my view, the proposed appeal founded on lack of jurisdiction has no real prospect of success and for that reason too this EOT Application should be dismissed.
Which specific DIFC statutes and RDC rules were central to the Court’s determination of jurisdiction and procedural compliance?
The Court relied heavily on the following provisions:
* Judicial Authority Law Article 5(A)(1)(a): Used to establish that the Court had jurisdiction over the First and Second Defendants as "Licensed DIFC Establishments," which provided the foundation for the joinder of D3.
* RDC 20.7: The rule governing the joinder of parties, which the Court confirmed was correctly applied in this instance.
* RDC 12.5: Cited as the basis for the Claimant's argument that D3 waived his right to dispute jurisdiction by failing to raise it before filing his Acknowledgement of Service.
* RDC 44.10 and RDC 44.13: The rules governing the deadline for filing appeals and the requirement to include the Appeal Notice, both of which D3 failed to satisfy.
How did the Court utilize the precedent of Nest Investments Holding Lebanon SAL v Deloitte & Touche (ME) [2018] DIFC CA 011?
The Court cited Nest Investments to reinforce the scope of RDC 20.7. In that case, the Court of Appeal clarified that RDC 20.7 is a procedural regulation that confers jurisdiction for the purposes of Article 5(A)(1)(e) of the Judicial Authority Law. Justice Sir Richard Field used this authority to validate the joinder of D3, confirming that once the Court has jurisdiction over the primary parties, it possesses the necessary authority to join additional parties involved in the same dispute, thereby defeating D3’s argument that the Court lacked jurisdiction over him.
What was the final disposition of the application, and what orders were made regarding costs?
The Court refused the Third Defendant’s application for an extension of time. Consequently, the proposed appeal could not proceed. Regarding costs, the Court ordered that the Third Defendant must bear the financial burden of the failed application:
The Third Defendant must pay the Claimant’s costs incurred in the said EOT Application to be assessed on the standard basis by a Registrar, if not agreed.
What are the practical implications for DIFC practitioners regarding jurisdictional challenges and procedural deadlines?
This case serves as a stern reminder that jurisdictional challenges must be raised at the earliest possible stage, specifically via an application under RDC 12.5 upon the filing of an Acknowledgement of Service. Practitioners cannot rely on "technical" eRegistry issues to excuse significant delays in filing appeals, especially when the underlying legal argument is deemed "hopeless." The Court’s reliance on the "abusive" nature of the application underscores a low tolerance for attempts to relitigate jurisdictional points that were implicitly accepted through participation in the trial process.
Where can I read the full judgment in Larmag Holding B.V. v (1) First Abu Dhabi Bank PJSC (2) Fab Securities LLC (3) Mr Abdullah Saeed Bakheet Obaid Aljaberi (4) Mr Ali Mohammed (5) Elite Holding Group Limited [2022] DIFC CFI 054?
The full judgment can be accessed via the DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/court-first-instance/cfi-0542019-larmag-holding-bv-v-1-first-abu-dhabi-bank-pjsc-2-fab-securities-llc-3-mr-abdullah-saeed-bakheet-obaid-aljaberi-4-mr-2 or via the CDN link: https://littdb.sfo2.cdn.digitaloceanspaces.com/litt/AE/DIFC/judgments/court-first-instance/DIFC_CFI-054-2019_20220819.txt.
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| Nest Investments Holding Lebanon SAL v Deloitte & Touche (ME) | [2018] DIFC CA 011 | To confirm RDC 20.7 confers jurisdiction under Article 5(A)(1)(e) of the Judicial Authority Law. |
Legislation referenced:
- Judicial Authority Law Article 5(A)(1)(a)
- Judicial Authority Law Article 5(A)(1)(e)
- RDC 12.5
- RDC 20.7
- RDC 44.10
- RDC 44.13
- RDC 44.19