In a recent judgment of the Dubai Court of First Instance finding in favour of a large international trading company represented by Clyde & Co in this matter in London and Dubai, the Court ordered the recognition and enforcement of a London Arbitration Award under the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards ("New York Convention").
The case was unusual as the arbitrator in the concerned DIFC-LCIA arbitration had found that the seat of the arbitration was London, rather than DIFC, so it was necessary to apply to the local Courts to enforce the Award, in which a Dubai LLC had been found liable in damages to our client. The application was therefore based on the New York Convention rather than being an application (as would normally be expected in a DIFC-LCIA arbitration) first to the DIFC Courts and then to the local Courts pursuant to the protocol between the Dubai Courts and the DIFC Courts.
Unlike last year's ruling of the Fujairah Courts to enforce an LMAA award in the UAE, the Dubai enforcement action in this case was fully contested by the Dubai company which lost in arbitration in London.
The New York Convention came into effect under UAE law in December 2006 but many foreign claimants are anxious to see the Courts of the UAE establishing a track record to fulfil the UAE's international obligations under the New York Convention and not allow the sort of technical defences (which should not be possible under the New York Convention) for which some notoriety was earned prior to the enactment of the Convention.
Although this is a First Instance decision which is open to appeal we are encouraged by the result and hope that it is an indication of an alignment between judicial thinking and the UAE's international treaty obligations under the New York Convention. If that proves to be the case this will be a significant step forward for the development of international arbitration in the UAE. Presently we await the full text of the judgment and a further update will be issued once the Court's full reasoning is known. Alec Emmerson, Consultant, and Keith Hutchison, Senior Associate, represent the Claimants in the UAE and advised Nigel Chapman, Partner, and Paul Lowrie, Senior Associate, in connection with the London Arbitration. Abdullah Hilal is the local Advocate working with Alec and Keith in presenting the case to the Dubai Courts.
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