Dubai Court acquitted resident investor of 100,000,000 dirhams debts

Ahmed Moawad - | UAE

The Court of Appeal in the United Arab Emirates upheld the ruling issued by the Court of First Instance exempting a resident of the Emirates, an Arab national, from debts originally estimated at 100 million dirhams.

The Dubai Court of Cassation confirmed the verdict, citing the fraudulent partnership and administration of a Gulf man for three firms formed by his brother in his name and ordering his removal from the partner registry.

To prove partnership and actual management of the defendant brother in the aforementioned companies, it ruled to add his name instead of the plaintiff in the register of partners and commercial licenses for those companies and to publish the ruling in two widely circulated newspapers.

A Gulf citizen filed a lawsuit in Dubai Courts, stating that he granted his brother a legal power of attorney in October 2016, certified by a notary public, allowing him to establish companies of all kinds, sign contracts for the purchase or sale of shares, change the trade name, and more. All procedures.

According to the plaintiff's defense attorney, Mohamed Najib, the plaintiff's brother's agency required the defendant to manage the companies' technical, administrative, and financial aspects by terminating bank transactions, signing checks, appointing employees, terminating their services, and relinquishing the plaintiff's shares in the company. Company, paid or unpaid.

He said the defendant brother bought shares in a contracting company with branches, altered its name, and registered them in his wife's name under the agency contract. The two brothers' side contract stated that the plaintiff would only be a guarantor of those companies' commercial licenses, with shares registered in his name for official purposes. Plaintiff signed the contract as a witness, not a party with rights or obligations.

Later, the plaintiff was astonished by legal rulings against the defendant corporations, and after inquiry and investigation, it became obvious that they owed 100 million dirhams.

The plaintiff canceled his agency to his brother, the defendant, in October 2021 and asked the judiciary to invalidate his actions of introducing him as a fictitious partner in those companies due to proven fraud and unfairness on the defendant's part, who took advantage of the agency and mismanaged them, causing heavy losses and debts.

The plaintiff identified a previous litigation between the defendant and another person who possessed interests in one of the defendant companies, in which he admitted to being the partner and manager. He produced evidence that he was fully engaged in managing companies in 2017 and commercial licenses for his private companies.

The defense of the defendant brother submitted a memorandum requesting that the complaint against him and his wife (the fourth defendant) be rejected for lack of legitimacy, proof, and interest.

After the court appointed an accounting expert, the report showed that the defendant brother and another partner handled all financial matters, banking transactions, corporate budgets, and profit and loss distribution.

The expert report found that the defendant brother owns all shares in the defendant companies and pays all their bills, and that his wife and his plaintiff brother's partnership is a farce.

Based on the findings and records, the court found that the plaintiff was a fictional partner who did not contribute money or enjoy profits and exonerated him of company debts.

After rejecting the initial ruling, the defendant and his wife appealed to the Court of Appeal, which referred the case back to an expert, who confirmed that the first appellant manages those companies and pays their debts. all.

The court of appeal upheld the previous verdict and ordered the appellants to pay fees and expenses after reviewing the case, papers, expert report, and pleadings.

Brother and wife appealed first-instance and appeal verdicts to the Court of Cassation, bringing the dispute to a close. The ruling's inaccuracy in interpreting the law, lack of reason, and infringement of the right of defense by ending up with a fake partnership between the brothers in violation of written proof were criticized in their appeal.

In response, the Court of Cassation said that formality is the agreement of two parties to execute an apparent, unreal act that conceals their relationship and that the trial court can extract or deny it.

The court affirmed the initial and appeal findings on partnership formality and absolved the fictional partner brother of company debts.

About Author

Ahmed Moawad
Ahmed Moawad
598 Total posts


Read Also

UAE
Mohre announces the facilitation of work permit procedures in the UAE when issued or cancelled

The Ministry of Human Resources and Emiratisation announced the facilitation of work permit procedures when issued or cancelled.

UAE
Dubai Airport announces new restrictions on passengers

Dubai Airport authorities announced some restrictions for non-travelers in July and August.

UAE
Companies in the UAE provide alternative systems for end-of-service compensation

Various alternate methods of end-of-service compensation are offered by businesses in the United Arab Emirates.

UAE
New important instructions for passengers traveling through Dubai airports

Travelers in a hurry to leave Dubai are advised to complete immigration 1.5 hours in advance of departure.

UAE
FTA announces the imposition of a fine of 10 thousand dirhams in the UAE due to taxes

It has been announced by the FTA that a fine of ten thousand dirhams will be imposed in the United Arab Emirates due to taxation.

UAE
The Meteorological Authority announces the date of rain in the UAE during the coming days and weeks

The dates of the upcoming rainy days and weeks in the Emirates are announced by the Meteorological Authority.

UAE
Mohre announces paid holiday for employees in the UAE

Mohre has stated that employees in the UAE will receive paid vacation time.

UAE
Expo Dubai gives families the chance to win a summer vacation in 7 destinations

During Expo Dubai, families have the opportunity to win a summer trip to one of seven different locations.

UAE
Dubai Mall Introduces Paid Parking from July 1 with Salik Boards Near Entrances

Boards displaying the distinctive grey and white Salik branding have recently appeared at various entrances of Dubai Mall, signaling the imminent introduction of paid parking for visitors.

UAE
The UAE authorities announced the evacuation of residents from a residential tower in Sharjah

It was stated by the authorities in the United Arab Emirates that the occupants of a residential tower in Sharjah would be evacuated.

UAE
Dubai announces plan to add 32 new metro stations by 2030

Dubai's Metro service is set to significantly expand in the coming years following the approval of a development plan by the emirate's Executive Council.

UAE
Dubai Targets $177bn FDI by 2033 with Major Metro Area Developments

Dubai has set an ambitious target to attract AED650 billion ($177 billion) in foreign direct investment (FDI) by 2033, supported by the Dubai Executive Council.

UAE
UAE announces 5-Year Penalty for Revealing Work Secrets

The Criminal Information Center (Wa'i) of the UAE's Public Prosecution recently brought attention to the consequences of sharing confidential company information on social media, with the undercurrent of "Work secrets are trust."

UAE
Dubai seized 1,274 drug shipments last year, including heroin, meth & marijuana

Dubai Customs reported 1,273 seizures of illicit drugs at land, sea, and air ports across the emirate as part of efforts commemorating the International Day Against Drug Abuse and Illicit Trafficking.

UAE
A new fuel prices in the UAE for the month of July.. Changes in taxi prices

The UAE has recently implemented new fuel tariffs for the month of July. The prices of taxis have been adjusted.

UAE
UAE Petrol Prices Decline Once More for July 2024

The UAE has announced a reduction in petrol prices for July 2024, marking the second consecutive month of price decreases across the country.

UAE
UAE Takes Action Against Counterfeit Goods with 620 Violations Recorded in 2023

Since the beginning of 2023 through the first half of the year, the UAE's Ministry of Economy has conducted 4,444 inspection tours across local markets. These efforts target cases of commercial fraud, imitation, and trademark counterfeiting,...

UAE
UAE Sets 6 New Rules from Fines to Paid Parking, Changes Effective July

As we approach the midpoint of 2024, the UAE has been abuzz with significant developments that are set to impact daily life and financial planning across the Emirates.

UAE
New fees and fines will be imposed on UAE residents starting July 1

There are six new restrictions that will take effect in July, ranging from paid parking to new fines in the UAE.

UAE
The UAE authorities announced the amendment of the system of paid parking fees in several areas

It was declared by the authorities in the UAE that they would be changing the system of paid parking fees in a number of different regions.

UAE
The UAE warns of hail and rain in some areas and issues an orange alert

This morning, the National Center of Meteorology in the United Arab Emirates issued an orange alert regarding the weather conditions in the UAE. The center warned of rain in some eastern regions, in addition to the presence of dusty conditions...

UAE
UAE police arrested Hundreds in overnight crackdown on cybercrime syndicates

In a sweeping overnight initiative across the UAE, significant cybercrime networks were disrupted, marking a pivotal moment in law enforcement's ongoing battle against digital crime.

UAE
UAE: Four New Mosques on Famous Square Corners Wow Residents

Sharjah has constructed four new mosques with traditional Islamic styles that really reflect Arab culture and Islam.

UAE
Dubai schools top global rankings in financial literacy and creative thinking

Dubai’s private schools have once again affirmed their global standing by achieving impressive rankings in financial literacy and creative thinking in the 2022 Programme for International Student Assessment (PISA), conducted by the Organisation for...

UAE
UAE: Ministry of Foreign Affairs issued a warning to travelers to 6 countries

The Ministry of Foreign Affairs of the United Arab Emirates issued a caution to travelers to six other nations.

UAE
Sharjah Summer Sale: 75% Discounts and Gold Prizes Starting July 1 in UAE

On July 1, Sharjah's much awaited massive summer sale returns promise for large bargains, spectacular events, and raffle prizes of Dh3 million.

UAE
Meteorology issues red and yellow alerts due to fog and rainfall in the UAE

As a result of fog and precipitation in the Emirates, meteorology professionals have issued red and yellow warnings.

UAE
The UAE announces a 35% discount on traffic violations for residents

The UAE government revealed huge discounts on traffic violations for UAE residents of up to 35%.

The UAE sets additional controls to legally regulate organ donation