This order marks the finality of the Claimant’s attempt to challenge the dismissal of its amendment application following the total strike-out of its underlying claim against Reem Emirates Aluminium.
What was the specific dispute between Five Real Estate Development and Reem Emirates Aluminium that led to this second permission application?
The litigation between Five Real Estate Development and Reem Emirates Aluminium originated as a construction dispute within the Technology and Construction Division. The Claimant sought to pursue various claims against the Respondent, which were subsequently met with a successful strike-out application. Following the court's decision to strike out the entire claim, the Claimant attempted to file an amendment application, which the court deemed moot. The Claimant then sought permission to appeal the refusal of that amendment, leading to the current order by Chief Justice Zaki Azmi.
The core of the dispute at this stage was the Claimant's insistence that the court had failed to provide adequate reasoning for the nullification of its amendment application. The Claimant argued that the procedural handling of the case was flawed, while the Respondent maintained that the strike-out order rendered the amendment application legally impossible to pursue. As noted in the court's reasoning:
The Strike Out Application having been issued long before the amendment application, the former application was decided first, as was entirely proper and to be expected by both parties. In the result, the strike out application succeeded and the whole of the Claimant’s claim was struck out by the Strike Out Order.
This order effectively closes the door on the Claimant's attempts to revive its claims through procedural amendments after the substantive claim had been dismissed. See FIVE REAL ESTATE DEVELOPMENT v REEM EMIRATES ALUMINIUM [2021] DIFC TCD 009 — Dismissal of strike-out application regarding FIDIC determination (31 May 2021).
Which judge presided over the Second Permission Application in TCD 009/2020?
The Second Permission Application was reviewed and determined by Chief Justice Zaki Azmi of the DIFC Courts. The order was issued on 29 July 2021, following the Claimant’s filing of a Second Appeal Notice on 29 June 2021, which challenged the earlier refusal of permission to appeal by Justice Sir Richard Field.
What were the specific legal arguments advanced by Five Real Estate Development and Reem Emirates Aluminium regarding the amendment application?
Five Real Estate Development argued that the court had failed to provide sufficient reasons for refusing its application to amend the claim. The Claimant’s position was that the amendment application remained a live issue that required a distinct and detailed judicial explanation, regardless of the status of the primary claim. The Claimant sought to challenge the procedural logic that automatically nullified the amendment upon the success of the strike-out application.
Conversely, Reem Emirates Aluminium argued that the Claimant’s position was legally untenable. The Respondent contended that once the entire claim was struck out by the Strike Out Order, there was no longer a valid proceeding in which an amendment could be made. The Respondent’s submissions emphasized that the Claimant’s attempt to appeal was "hopelessly devoid of merit," as the nullification of the amendment was a logical consequence of the strike-out, requiring no further court direction.
What was the precise doctrinal question Chief Justice Zaki Azmi had to answer regarding the "real prospect of success" for the appeal?
The court was tasked with determining whether the Claimant’s proposed appeal met the threshold for permission to appeal under the Rules of the DIFC Courts (RDC). Specifically, the Chief Justice had to decide if the Claimant had demonstrated a "real prospect of success" or if there were "compelling reasons" for the appeal to be heard. The doctrinal issue centered on whether a judge is required to provide extensive, separate reasoning for the nullification of a procedural application (the amendment) when that application has been rendered moot by a prior, dispositive order (the strike-out).
How did Chief Justice Zaki Azmi apply the "real prospect of success" test to the Claimant's application?
Chief Justice Zaki Azmi applied the established RDC criteria for granting permission to appeal, noting that the Claimant failed to meet the necessary threshold. The Chief Justice reviewed the submissions from both parties and the judgment of Justice Sir Richard Field, concluding that the Claimant’s argument regarding a lack of reasoning was fundamentally flawed. The court reasoned that the nullification of the amendment was an inevitable procedural outcome of the strike-out order.
The Chief Justice highlighted that the judge of first instance had already provided clear and logical reasons for his decision. The reasoning process was summarized as follows:
The learned judge, said: “In my judgment, the Claimant’s proposed appeal is wholly without merit and would have no realistic prospect of success. Any competent practising litigant lawyer should have appreciated that it followed as night follows day that the Amendment Application was nullified and ceased to be maintainable by reason of the Strike Out Order without the need for an order or direction to this effect being issued by the Court.
The Chief Justice found no error in the lower court's approach, affirming that the logic was self-evident and did not require further elaboration or citation of authorities.
Which specific RDC rules and judicial principles were referenced in the determination of the Second Permission Application?
The court relied on the RDC provisions governing permission to appeal, which mandate that such permission may only be granted if the court considers that the appeal has a "real prospect of success" or if there is some other "compelling reason" for the appeal to be heard. Chief Justice Zaki Azmi noted that the principles and authorities for deciding such applications are "very well established" and did not require recitation in the order. The court also referenced the procedural history of the case, specifically the Strike Out Order and the subsequent email from the Registry dated 16 May 2021, which had already clarified the status of the amendment application to the parties.
How did the court utilize the previous rulings of Justice Sir Richard Field in this decision?
The court utilized the previous rulings of Justice Sir Richard Field as the primary basis for dismissing the Second Permission Application. Chief Justice Zaki Azmi noted that the judge of first instance had already refused a similar application and provided a "well written set of reasons" for doing so. By reviewing the judgment dated 4 May 2021 and the order dated 8 June 2021, the Chief Justice determined that the Claimant was essentially requesting a reconsideration of a matter that had already been thoroughly adjudicated. The court adopted the reasoning of the first instance judge, agreeing that the Claimant’s appeal was "wholly without merit."
What was the final disposition and the specific costs order made against Five Real Estate Development?
The court dismissed the Second Permission Application in its entirety. Furthermore, the court ordered the Claimant to bear the costs of the application, to be paid on the standard basis. The order specified that if the parties could not agree on the quantum of these costs, they would be subject to assessment by the Registrar. As stated in the order:
The Claimant shall pay the Respondent’s costs of the Second Permission Application on the standard basis, to be assessed by a Registrar if not agreed.
This final order effectively concluded the procedural challenges related to the amendment application.
What are the wider implications for DIFC practitioners regarding the nullification of procedural applications?
This case reinforces the principle that procedural applications, such as requests to amend pleadings, are inherently linked to the viability of the underlying claim. Practitioners must anticipate that if a primary claim is struck out, any pending procedural applications will be automatically nullified without the need for specific court orders to that effect. The ruling serves as a warning that pursuing appeals on grounds that are "hopelessly devoid of merit" may result in adverse costs orders, including potential indemnity costs if the court deems the conduct particularly unreasonable. Litigants are expected to recognize the logical consequences of dispositive orders and avoid wasting judicial resources on moot procedural points.
Where can I read the full judgment in Five Real Estate Development v Reem Emirates Aluminium [2021] DIFC TCD 009?
The full order with reasons can be accessed via the DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/technology-and-construction-division/tcd-0092020-five-real-estate-development-llc-v-reem-emirates-aluminium-llc or via the CDN link: https://littdb.sfo2.cdn.digitaloceanspaces.com/litt/AE/DIFC/judgments/technology-and-construction-division/DIFC_TCD-009-2020_20210729.txt.
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| Five Real Estate Development v Reem Emirates Aluminium | [2021] DIFC TCD 009 | Primary subject of the appeal |
Legislation referenced:
- Rules of the DIFC Courts (RDC) - Permission to appeal criteria