DCC 108/2009/1

This case involved whether the new or former owner of a sole trader business was responsible for an employee's rights and dues, if that business was sold.

Background

former employee of the Respondent, brought forward proceedings against the Respondent seeking compensation for various employment rights, including unlawful termination.

The Respondent, was a sole proprietorship, was sold by its previous owner to a new owner and as part of the sale agreement, the old owner of the Respondent pledged to cover and be responsible for any existing obligations.

The termination of the employee occurred before the acquisition took place.

The Respondent contested they could not be held responsible for the actions of the previous owner of the entity and as such, since the employment claim did not relate to any action taken by the Respondent after the acquisition. It was argued the Claimant should seek damages directly from the previous owner of the entity.

Proceedings

Dubai Court of First Instance - Decision No 60 of 2009

Under decision 60/2009 the Court of First Instance allowed the Claimants' claim.

Dubai Court of Appeal - Appeal No 814 of 2009