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DIFC Court clarifies scope of own jurisdiction in relation to contempt proceedings

07/01/19

VIH Hotel Management Ltd v Assas Opco Ltd & Ors

Field J, sitting as a judge of the Court of First Instance of the Dubai International Financial Centre, has handed down a judgment which clarifies the jurisdiction of the DIFC Courts in a number of respects, particularly in relation to contempt proceedings.

On 22 June 2017, VIH Hotel Management Ltd obtained an ex parte injunction from the DIFC Courts which purported to prohibit Assas Opco Ltd from interfering with VIH’s management and operation of a luxury hotel located on the Palm Jumeirah, Dubai.

The hotel was originally known as the Viceroy Palm Jumeirah, but is now known as the FIVE Palm Jumeirah.

After a series of further applications and hearings, VIH brought proceedings against Assas Opco (and various other respondents) for alleged breaches of the injunction and contempt of court.

Following a two-day hearing in Dubai, Field J dismissed VIH’s contempt application (against all of the respondents) in its entirety.

In the course of his judgment, Field J has clarified a number of points of principle as to the jurisdiction of the DIFC Courts.

First, Field J held that, as a matter of policy, orders of the DIFC Courts must be obeyed unless and until set aside, even if such orders are irregular or made without jurisdiction.  This is the case notwithstanding that, unlike a court of general or unlimited jurisdiction (such as the English High Court), the jurisdiction of the DIFC Courts is statutory and limited by reference to various “gateways” which are set out in Article 5(A) of the Judicial Authority Law (Dubai Law No. 12 of 2004 (as amended by Law No. 16 of 2011)).

Second, Field J held that the DIFC Courts have jurisdiction to hear proceedings for contempt of court against third parties (i.e. non-parties to orders of the DIFC Courts), even if the DIFC Courts would not otherwise have jurisdiction over such parties under any of the other “gateways” in the Judicial Authority Law.  As Field J acknowledged, the consequence of this finding is that the DIFC Courts potentially have the power to make orders of contempt against third party respondents “… wherever they are in the world”.

Third, Field J confirmed that the DIFC Courts have no jurisdiction in relation to matters which are crimes under Dubai or UAE law.  In England, it is well-established that contempt of court by a non-party to a court order is a criminal contempt and a criminal offence.  However, Field J left open the question as to the circumstances in which an alleged contempt by a non-party might be classified as a crime under Dubai or UAE law. 

Fourth, Field J also clarified various points of procedure as to the inter-relationship between proceedings before the DIFC Courts and the Dubai Joint Judicial Committee.  The JJC was established pursuant to Decree No. 19 of 2016 for the purpose of resolving conflicts of jurisdiction between the DIFC Courts and the courts of “onshore” Dubai.

The judgment (which was handed down on Christmas Day 2018) is here.


Michael Swainston QC, Edward Harrison and Kyle Lawson appeared for Assas Opco and Mr Kabir Mulchandani, the First and Second Respondents.