ADGM Courts Reject Bank’s Credit Card Claim on Implied Jurisdiction

The Abu Dhabi Global Market (ADGM) Courts have dismissed a credit card recovery claim, holding that banks cannot create court jurisdiction through implied consent or unilateral changes to contractual terms.

 

The ruling was issued by the Small Claims Division, where Justice James Walker McNeill KC found that ADGM lacked jurisdiction to hear the dispute due to the absence of a clear written agreement between the parties.

 

Agreement predates ADGM

 

The claim, filed on July 24, 2025, sought recovery of alleged credit card dues from customer Fahrudeen Karim Abubacker Syed Mohamed.

 

The claimant argued that the ADGM Courts had jurisdiction based on amended terms and conditions referenced in electronic monthly statements. However, the original credit card agreement dated back to 2004 — several years before ADGM was established — and the claimant was unable to produce a signed copy, stating it had been destroyed in a fire.

 

Instead, the bank relied on implied consent, contending that the customer had accepted the amended terms, including a jurisdiction clause, by continuing to use the card.

 

Defence successfully challenges jurisdiction

 

The defendant, represented by Ayesha Al Dhaheri Advocates and Legal Consultants, challenged the court’s jurisdiction on several grounds:

• No written jurisdiction agreement existed;
• The card was issued in 2004, before ADGM was created;
• All related transactions took place in Dubai;
• No amended agreement had ever been signed.
  
  

The court agreed, finding that routine references to “Terms and Conditions apply” in electronic statements were insufficient to introduce a fundamental contractual change such as court jurisdiction.

The judgment emphasised that ADGM, as a special jurisdiction, requires explicit and informed written consent under Article 13(8) of its Founding Law.

Central Bank rules reinforced

The ruling also cited the UAE Central Bank Consumer Protection Regulations (Circular No. 8/2020), which require licensed financial institutions to ensure effective disclosure at all stages of the customer relationship and to inform consumers in advance of any permissible contractual changes.

Justice McNeill underlined that jurisdiction cannot be created through silence, implication or unilateral amendments embedded in routine banking communications.

Costs awarded against claimant

After allowing the defendant’s jurisdiction challenge, the court ordered the claimant to pay legal costs.

Although more than Dh27,000 was claimed, the court reduced the amount on summary assessment and directed payment of Dh9,400.15 (approximately $2,559).

Legal representatives for the defendant described the ruling as a significant reaffirmation that financial institutions must obtain clear and express customer agreement before attempting to shift jurisdiction through amended terms.

The judgment is widely viewed as strengthening consumer protection safeguards and clarifying the limits on altering contractual terms in digital banking relationships.

 

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