DCC 59/1999

The original dispute was a claim brought against a bank in Sudan which had issued an irrevocable letter of credit but had not provided the funds. It was argued the Dubai Courts had no jurisdiction in this case. Part of the contract had been undertaken in Dubai so the Dubai Courts did have jurisdiction.

Background

A claim was brought against a bank ordering it to pay US$ 340,000 plus legal costs and interest. The claimant stated the bank, based in Sudan, had issued an irrevocable letter of credit for US$ 340,000 which was to be given to the claimant. However, the bank had failed to provide the funds. In the first instance court, the defendant argued the court had no jurisdiction and the court dismissed the claim. The claimant appealed and the appeal court dismissed the claim again citing lack of jurisdiction. The claimant appealed by cassation under the Civil Procedure Law, stating that the courts did have jurisdiction as the letter of credit was for payment of a commercial contract which was partly executed in the UAE. Payment should have been made in Dubai, therefore the Dubai courts should have jurisdiction.

Decision