Claim No: ARB 028/2020
IN THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
IN THE COURT OF FIRST INSTANCE
BETWEEN
LIKITIF
Claimant
and
LUVAUN
Defendant
ORDER WITH REASONS OF H.E JUSTICE SHAMLAN AL SAWALEHI
UPON the Claim Form being filed on 1 October 2020 and amended on 22 April 2021 (the “Claim”)
AND UPON reviewing the Rules of the DIFC Courts (the “RDC”)
AND UPON reviewing the documents submitted by the Claimant and the Defendant (the “Parties”)
AND UPON reviewing Dubai Decree No. 34 of 2021 Concerning the Dubai International Arbitration Centre (the “Decree”)
AND UPON reviewing the DIAC Arbitration Rules 2022 (the “DIAC Rules 2022”)
AND UPON reviewing the correspondence between the Parties and the Registry
AND UPON reviewing the Arbitration Law DIFC Law No.1 of 2008 (the “Arbitration Law 2008”)
IT IS HEREBY ORDERED THAT:
1. The Claimant’s Claim seeking financial remedies from the Defendant is dismissed due to the presence of an Arbitration Agreement signed and agreed between the parties contained in the Subcontract Agreement.
2. Each party shall bear their own costs.
Issued by:
Ayesha Bin Kalban
Acting Registrar
Date of Issue: 25 October 2022
At: 10am
SCHEDULE OF REASONS
1. On 22 April 2021, Likitif (the “Claimant”), filed an amended particulars of claim seeking financial remedies from, Luvaun, (the “Defendant”) in the amount of AED 13,567,443.99 (the “Outstanding Amount”) based on works executed at DIFC and supplied materials for the project.
2. The Claimant relies on two separate documents in this Claim, being (i) the subcontract agreement 1234 signed and dated 20 March 2017 (the “Subcontract Agreement”); and (ii) an invoice titled 001 dated 14 March 2020 in the amount of AED 3,981,923.47 (the “Invoice”).
3. The Subcontract Agreement includes an agreement to arbitrate contained under Article 30 which states the following:“Arbitration Procedural Rules – DIFC LCIA Arbitration Centre (the “Rules”)” [sic].
4. The second document used in support of the Claimant’s Claim is the Invoice which does not include an arbitration clause however it indicates that the works have been executed in accordance with the Subcontract Agreement 1234 relevant to supply and installation.
5. Accordingly, the Invoice evidently would form part of the terms and conditions of the Subcontract Agreement, thereby the agreement to arbitrate indicated in the Subcontract Agreement would be binding between the Claimant and the Defendant.
6. Further, there is no provision in the Invoice to suggest or indicate that the agreement to arbitrate in the Subcontract Agreement is invalid or no longer enforceable. In the absence of any prevailing provision in the Invoice, the agreement to arbitrate in the Subcontract Agreement would be binding and enforceable.
7. The Parties have agreed that any dispute would be resolved pursuant to the DIFC-LCIA by virtue of Article 30 of the Subcontract Agreement. However, pursuant to Dubai Decree No. 34 of 2021 (the “Decree”), DIFC-LCIA arbitrations are now conducted under the DIAC Arbitration Rules 2022 (the “DIAC Rules 2022”).
8. Accordingly, the procedural rules applicable to the Arbitration are the DIAC Rules 2022.
9. The Court acknowledges that the seat of arbitration is contained under Article 32 of the Subcontract Agreement which states that the“seat of the Arbitration is DIFC, United Arab of Emirates”.For the purposes of Article 20 of the DIAC Rules 2022, it should be determined that DIFC is the seat of these proceedings.
10. Finally, considering that there is an agreement between the parties to arbitrate in the event there is any dispute, claim or difference arising out of, or in connection with the Subcontract Agreement, the DIFC Courts are unable to hear this Claim. This is in conformity with Article 13 of the Arbitration Law, DIFC Law No.1 of 2008 which states that“if an action is brought before the DIFC Court in a matter which is the subject of an Arbitration Agreement, the DIFC Court shall… dismiss… such action.” [sic].
11. The DIFC Courts do not have exclusive jurisdiction over this Claim.
Conclusion
12. Each party shall bear their own costs.