![We Tried [u]bk's Lively Garden Brunch at Mövenpick JLT Dubai](https://cdnexpatwomanfood.expatwoman.com/s3fs-public/urban%20bar%20and%20kitchen%20brunch%20main.png "We Tried [u]bk's Lively Garden Brunch at Mövenpick JLT Dubai")
Learn about the DIFC Small Claims Tribunal and its usefulness in commercial disputes of moderate value.
19 December 2017
| Last updated on 31 March 2019
The DIFC Small Claims Tribunal provides a useful forum for both small and large businesses to bring claims of moderate value and complexity for a relatively low expense, and to obtain quick judgments without committing significant time and resources to protracted litigation.
The DIFC Small Claims Tribunal (the SCT) is suitable for employment claims for DIFC employees and employers, debts and other general disputes falling within the SCT threshold.
The SCT operates under the auspices of the DIFC Courts and DIFC Court Rules, and may hear claims of a value up to AED 500,000 where claims are subject to the jurisdiction of the DIFC Courts (or up to AED 1,000,000 if the parties to the relevant agreement have expressly agreed to the upper threshold). Significantly, the DIFC is an opt-in jurisdiction, meaning parties located anywhere in the world can choose to have their disputes determined in the DIFC (and consequently by the SCT).
Key features of a claim brought with the SCT include:
Claims are easy to initiate
Claims can be filed online and, in the first instance, will be served by the SCT, who will coordinate initial consultations (effectively mediations) and subsequent hearings.
Cost effective
Comparatively low court fees and no legal representation permitted (therefore no immediate exposure to costs for legal fees and no express need to engage lawyers to bring a claim).
Accessible
SCT consultations and hearings can be conducted via telephone or video conference.
Designed for the lay person
The SCT is intended to allow claimants to bring claims without engaging a lawyer. Whilst the DIFC Court Rules will still apply to SCT proceedings, consultations and hearings are relatively informal as compared to full court proceedings, where legal representation is a necessity. There is an emphasis on seeking to have the parties resolve disputes by settlement.
Choice of governing law
DIFC law is applied where there is no governing law specified and the SCT considers it has jurisdiction to hear the dispute.
Common Law framework
It is possible to draw on common law judgments as persuasive or binding.
Streamlined enforcement procedures
Judgments can be enforced both within the DIFC and onshore in Dubai (pursuant to the enforcement protocol between the DIFC Courts and the Dubai Courts) and elsewhere in the UAE once the judgment is ratified by the Dubai Courts.
Opt-in
The DIFC is an op- in jurisdiction, meaning that parties can opt in by agreement to having a dispute determined by the DIFC Courts or SCT.
SEE ALSO: Debts Collection: Effective Strategy to Recover Your Unpaid Invoices
An effective debt recovery forum for claims
The SCT can be particularly useful for basic debt recovery. Debt recovery in the UAE is a challenge for businesses of all sizes, often because the formal debt collecting avenues are cumbersome and expensive. These are not commercial exercises where the debt is moderate, and debtors are often aware of this when responding (or not) to legal notices requesting payment in order to avoid formal proceedings.
The benefit of the SCT is, in relatively short order, with minimal expense, and in English, a claim can be brought and a judgment obtained. Whilst the judgment itself still needs to be enforced, the existence of an enforceable judgment is often sufficient to encourage the debtor to pay.
Not just for debt claims, other claims are possible
The SCT is not limited to hearing claims for debt; it will hear labour claims arising pursuant to the DIFC Employment Law and other claims of moderate complexity and of a value falling within the prescribed thresholds, where the dispute is the subject of DIFC Court’s jurisdiction or where the parties elect in writing that the dispute be heard by the DIFC SCT (via an opt-in clause in the relevant contract).
Please note, a dispute resolution clause in a commercial contract is not a ‘one size fits all provision'. Banks Legal can help you determine if a DIFC Courts/SCT dispute clause is appropriate for you.
Nathan Banks
Managing Partner
M +971 (0)50 189 3276
E [email protected]
Andrew MorrisPartner
M +971 (0)50 653 8148
E [email protected]
