In a recent decision dated 15 August 2024, the Dubai Court of Cassation (Court of Cassation) in Case No. 339 of 2023 (Civil) confirmed that a judgment from a foreign court may be enforced in the United Arab Emirates (UAE) notwithstanding that the UAE courts would have had jurisdiction to determine the underlying dispute.
BACKGROUND
A judgment creditor commenced proceedings in the onshore Dubai courts to enforce a monetary judgment issued in Poland. The enforcement judge initially confirmed that the Polish judgment could be enforced in the UAE. However, upon appeal by the defendant, the Court of Appeal ruled to vacate that order. The judgment creditor appealed that decision to the Court of Cassation.
RULING OF THE COURT OF CASSATION
The issue before the Court of Cassation was whether the enforcement of a foreign judgment in the UAE could be refused on the basis that the UAE courts had jurisdiction over the underlying dispute by virtue of the defendant's residency in the UAE. The judgment creditor argued that the defendant's residence in the UAE does not prevent a lawsuit from being filed against him in his home country, Poland, particularly given that the judgment relates to an incident that occurred in Poland and does not preclude the enforcement of the foreign judgment against the defendant in Dubai.
Historically, the Dubai courts have held that, pursuant to Article 235 of the old Civil Procedures Law No. 11 of 1992 (Old Civil Procedures Law), foreign judgments could not be enforced in the UAE if the UAE courts had jurisdiction to consider the underlying dispute, even if such jurisdiction was not exclusive.
The Court of Cassation held that the legislator has since departed from that approach and made it clear that it is not sufficient that the UAE courts had jurisdiction to consider the dispute; what prevents the enforcement of a foreign judgment is that the UAE courts have exclusive jurisdiction over the matter.
In this regard, the Court of Cassation referred to the conditions for the enforcement of foreign judgments in the UAE set forth in Article 85 of Cabinet Resolution No. 57 of 2018 Concerning the Implementing Regulations of the Old Civil Procedures Law (Implementing Regulations), the text of which was replaced by Cabinet Resolution No. 75 of 2021 corresponding to Article 222 of Law No. 42 of 2022 (Civil Procedures Law). One of the conditions that must be satisfied, contained in Article 85(2)(a) of the Implementing Regulations (as amended), is that the UAE courts do not have exclusive jurisdiction over the underlying dispute, and the foreign court that issued the judgment or order has jurisdiction thereover in accordance with the rules governing international jurisdiction laid down in its law. The Court of Cassation confirmed that the law is clear and unambiguous and therefore may not be deviated from by way of interpretation or construction.
Accordingly, as the UAE courts did not have exclusive jurisdiction over the underlying dispute, there was no basis for refusing enforcement of the Polish judgment.
CONCLUSION
This judgment illustrates the willingness of the onshore UAE courts to enforce foreign judgments in the UAE. It is particularly significant for claimants who wish to elect to resolve disputes in foreign courts while retaining the right to enforce a favorable judgment in the UAE.
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