What is the specific nature of the dispute between Jeffrey Stone and Abhi Fintech Limited regarding the valuation of share entitlements?
The litigation arises from a claim by Jeffrey Stone against Abhi Fintech Limited and Abhi Limited concerning unpaid emoluments and benefits following what the Claimant alleges was an invalid termination of his employment. Central to the dispute is the Claimant’s entitlement to a 3.5% stake in the Second Defendant, which the Defendants have admitted he is entitled to receive. Despite this admission, the shares have not been transferred.
The Claimant seeks a declaration and an order for specific performance to compel the transfer of these shares. However, recognizing the potential for the primary remedy to be unavailable or insufficient, the Claimant has pleaded an alternative claim for damages. The dispute centers on the valuation of these non-dilutable shares, which the Claimant argues requires expert forensic accountancy evidence to determine quantum. The Defendants initially resisted this, asserting that specific performance was the only appropriate remedy, thereby rendering expert valuation evidence unnecessary.
Which judge presided over the application in CFI 089/2023 and in which division of the DIFC Courts was the matter heard?
The application was heard by H.E. Justice Andrew Moran in the Court of First Instance. The order, which granted both parties permission to call forensic accountancy experts, was issued on 16 April 2025, following a hearing held on 10 April 2025.
How did the parties’ legal counsel frame their arguments regarding the necessity of expert evidence for share valuation?
Mr. Doherty, representing the Claimant, argued that expert evidence was essential to assist the Court in assessing damages should the primary claim for specific performance fail. He relied on the List of Issues approved by H.E. Justice Nassir Al Nasser, specifically issue 20(b), which explicitly contemplates the Court determining the quantum of losses if the Claimant is entitled to damages for the breach of his share entitlements.
Conversely, Mr. Bheeroo, representing the Defendants, initially contended that the application should be dismissed under RDC 31.12. He argued that the Court would only ever grant specific performance or a mandatory injunction if the Claimant succeeded on liability, making any valuation of the shares for damages purposes redundant. However, the Defendants adopted a secondary position, requesting that if the Court were minded to grant the Claimant permission, they too should be permitted to call a forensic accountancy expert to provide a competing valuation.
What is the precise doctrinal issue the Court had to resolve regarding the threshold for expert evidence under RDC 31.12?
The Court was required to determine whether expert evidence is "reasonably required" to resolve proceedings when a claimant seeks specific performance as a primary remedy but pleads damages as an alternative. The doctrinal tension lay in whether a defendant can preclude the introduction of expert evidence by asserting that the Court will, as a matter of course, grant specific performance rather than damages. The Court had to decide if the mere existence of a pleaded alternative claim for damages, supported by an agreed List of Issues, satisfies the threshold for expert evidence under the RDC, regardless of the Defendants' preference for the primary remedy.
How did Justice Andrew Moran apply the test of reasonable requirement to the valuation of the Claimant’s shareholding?
Justice Moran rejected the Defendants' argument that the Court would be limited to specific performance, noting that the Court must be prepared to assess damages if the primary claim fails or is insufficient. The Judge emphasized that the Court requires expert assistance to quantify the value of the shares to properly adjudicate the alternative claim.
The Court is satisfied that it will be cogent, helpful and is entirely proportionate to the probable value of the shares
The Court reasoned that the Defendants' attempt to limit the scope of the trial to specific performance was an "extraordinary spectacle" that ignored the reality of the pleaded alternative claim. By allowing both parties to call experts, the Court ensured that it would have the necessary forensic accounting data to reach a just conclusion on quantum, should the need for a damages award arise.
Which specific DIFC statutes and RDC rules were applied to determine the admissibility of the expert evidence?
The Court’s decision was grounded in the Rules of the DIFC Courts (RDC), specifically Part 31, which governs the use of expert evidence. Justice Moran focused on RDC 31.12, which mandates that expert evidence must be "reasonably required" to resolve the proceedings. Furthermore, the Court referenced the Law of Damages and Remedies, DIFC Law No 7 of 2005, specifically Articles 38 and 39, which provide the statutory framework for the assessment of damages in cases of breach of contract. The Court also utilized its case management powers under RDC Part 23 to structure the expert evidence process.
How did the Court utilize the cited precedents and procedural rules to manage the costs of the expert evidence?
The Court applied the principle that costs should follow the event, particularly where a party unsuccessfully resists an application for expert evidence. Justice Moran noted that the Defendants had failed in their primary argument to block the expert evidence.
The normal order where Parties on both sides are granted permission to adduce expert evidence, which the Court considers at the time of an application is reasonably required, is for the costs of expert evidence to be in the case.
However, the Court also addressed the specific costs of the application itself. Because the Defendants had forced the Claimant to bring an application that they later conceded was necessary (by requesting their own expert), the Court ordered the Defendants to pay the Claimant's costs of the application, assessed at USD 68,046.67. This was deemed necessary to ensure the Claimant was not "kept out of pocket" for a procedural hurdle created by the Defendants' initial resistance.
What was the final disposition of the application and the specific orders made regarding costs and expert testimony?
The Court granted both parties permission to call one forensic accountancy expert each to provide an opinion on the value of the Claimant’s non-dilutable shareholding in the Second Defendant. The Court ordered that the costs of obtaining and calling this expert evidence would be "costs in the case," meaning the ultimate liability for these costs will be determined at the conclusion of the trial. Regarding the costs of the application itself, the Court ordered the Defendants to pay the Claimant the full amount of USD 68,046.67, noting that the Defendants had failed in their primary resistance to the application.
How does this ruling change the practice for litigants in DIFC employment and commercial disputes involving share entitlements?
This decision serves as a warning to defendants who attempt to restrict the scope of evidence by arguing that only specific performance is appropriate. Practitioners must anticipate that if a claimant pleads damages as an alternative to specific performance, the Court is highly likely to permit expert valuation evidence to ensure all potential outcomes are covered. The ruling underscores that the Court will not allow a defendant to unilaterally dictate the remedy at the interlocutory stage to avoid the costs and scrutiny of expert valuation. Litigants should be prepared for "costs in the case" orders for expert evidence, but must be wary of the risk of adverse costs if they unsuccessfully oppose the introduction of such evidence at the application stage.
Where can I read the full judgment in Jeffrey Stone v (1) Abhi Fintech Limited (2) Abhi Limited [2025] DIFC CFI 089?
The full judgment can be accessed via the DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/court-first-instance/cfi-0892023-jeffrey-stone-v-1-abhi-fintech-limited-2-abhi-limited-12 or via the CDN link: https://littdb.sfo2.cdn.digitaloceanspaces.com/litt/AE/DIFC/judgments/court-first-instance/DIFC_CFI-089-2023_20250416.txt
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| N/A | N/A | No specific case law precedents cited in the provided text. |
Legislation referenced:
- Rules of the DIFC Courts (RDC) Part 31
- Rules of the DIFC Courts (RDC) Part 23
- Law of Damages and Remedies, DIFC Law No 7 of 2005, Articles 38 and 39