Commercial

A Dubai investor who entrusted a man with assets including six kilogrammes of gold and cryptocurrency has been awarded more than Dh4.7 million by a Dubai court after the assets were misappropriated.

The Dubai Civil Court ordered the defendant to pay Dh4.4 million, representing the value of the misappropriated assets, and an additional Dh300,000 in compensation for the damages suffered by the investor.

The ruling followed an earlier criminal case in which the Dubai Misdemeanours and Violations Court convicted the defendant of breach of trust. He was sentenced to three years in prison, ordered to be deported from the UAE and fined Dh4.4 million.

According to court records, the investor had entrusted the defendant with assets including six kilogrammes of gold and cryptocurrency under an agency arrangement.

However, the defendant misappropriated the assets placed in his custody, prompting criminal proceedings. The criminal court subsequently found him guilty of breach of trust, and the judgment became final.

Following the conviction, the investor filed a civil lawsuit seeking the return of the value of the misappropriated assets, along with compensation for the financial and other damages he had suffered.

In its ruling, the civil court held that the final criminal judgment had conclusively established that the defendant had committed the offence and misappropriated assets belonging to the investor.

The court explained that, because the criminal judgment had become final, the defendant's criminal responsibility could not be reconsidered during the civil proceedings.

The civil court's role was therefore limited to assessing the damage resulting from the established offence and determining the amount the investor was entitled to recover.

On the claim for restitution, the court ordered the defendant to pay Dh4.4 million, representing the value of the assets proven to have been misappropriated. It additionally awarded the investor Dh300,000 in compensation for the damages arising from the offence.

The defendant was also ordered to pay legal interest on the amounts awarded, as well as court fees and expenses.

The judgment highlights an important legal principle: findings established by a final criminal judgment are binding on a civil court when it considers compensation arising from the same offence. Once criminal responsibility has been conclusively established, the civil proceedings focus on assessing the financial damage caused and determining the compensation payable to the affected party.

The Dubai Civil Court has ordered a woman to return Dh100,000 that was mistakenly transferred to her bank account, along with legal interest of 5% per annum from the date of the judicial claim until the amount is fully paid.

The case arose after an Asian national accidentally transferred the money to the woman's account while making a deposit through an ATM in January 2025. He had entered the wrong beneficiary account number, resulting in the Dh100,000 being credited to the woman's account.

According to the case documents, the man contacted the account holder after discovering the error. She acknowledged that the money had been transferred to her account and explained that she was outside the UAE and that her bank account had been blocked.

She subsequently informed him that she had contacted the bank and submitted a request for the amount to be returned to its rightful owner. However, the money was not transferred back, prompting the man to file a lawsuit before the Dubai Civil Court seeking recovery of the Dh100,000.

The court appointed an expert to examine the circumstances of the transaction. The expert's report confirmed that the plaintiff had deposited Dh100,000 into the woman's account by mistake.

The court also found that the woman had taken steps to authorise the return of the money. In February 2025, she issued an authorisation to the bank requesting that the amount be transferred to the plaintiff. In July 2025, she also submitted a telegraphic transfer request for the return of the funds. However, the amount was ultimately not returned.

The court held that the woman remained liable for the disputed amount because the documents before it contained no evidence that the Dh100,000 had been repaid.

The court further noted that the woman had failed to attend the hearings to present a defence or dispute the plaintiff's entitlement to the money. It affirmed the legal principle that a person who comes into possession of another person's money is required to return it.

Accordingly, the Dubai Civil Court ordered the woman to pay the plaintiff Dh100,000, together with legal interest at 5% per annum from the date of the judicial claim until full payment. She was also ordered to pay the court fees, expenses and attorney's fees.

The UAE's construction industry has never stood still, and neither should the law that governs it. From iconic skyscrapers and mega infrastructure projects to luxury residential developments, the country's construction sector has evolved into one of the most sophisticated in the world. Recognising this transformation, the UAE introduced Federal Decree-Law No. 25 of 2025 concerning the Civil Transactions Law, which came into force on 1 June 2026.

While the new law does not radically alter the fundamentals of construction contracting, it modernises the legal framework to better reflect today's commercial realities. More importantly, it encourages parties to move beyond simply signing contracts and towards managing them effectively throughout the life of a project.

Good Faith: A Practical Commercial Obligation

One of the defining features of the new law is its emphasis on the principle of good faith. In construction projects, employers, contractors, subcontractors, consultants and suppliers are required to work together over extended periods, often while responding to changing site conditions and commercial demands.

The legislation reinforces the principle that contractual relationships should be conducted honestly, transparently and fairly. Withholding material information, engaging in misleading negotiations or acting opportunistically can create unnecessary disputes and expose parties to legal consequences. In practice, good faith is no longer viewed merely as a legal principle; it is a commercial necessity for successful project delivery.

Better Contracts Mean Fewer Disputes

Many construction disputes begin long before a project encounters delays or defective works. They often originate from contracts containing vague or inconsistent provisions.

Clauses governing payment, variations, extensions of time, delay damages and termination should clearly reflect the commercial intentions of the parties. The new legal framework reinforces the importance of interpreting contracts according to their purpose and the parties' intentions, making careful drafting more important than ever.

For legal practitioners and commercial teams, the message is clear: standard templates should never replace contracts tailored to the realities of a particular project.

Greater Clarity for Muqawala Contracts

Muqawala (construction) contracts remain the cornerstone of the UAE construction industry. The updated Civil Transactions Law preserves the established rights and obligations of employers and contractors while providing greater coherence in areas such as project performance, completion, payment obligations and defective works.

The reforms also highlight the importance of proper contract administration. Compliance with contractual procedures, timely notices and accurate documentation are no longer administrative formalities; they are essential safeguards that can significantly influence the outcome of future disputes.

Termination Should Always Be the Last Resort

Termination remains one of the most significant remedies available in construction contracts, particularly where a contractor abandons the works, repeatedly misses contractual milestones or delivers defective work.

However, the new framework reinforces that termination must never be approached casually. Parties should ensure that they comply with both the contractual notice provisions and the applicable legal requirements before bringing a contract to an end. Properly documenting breaches, issuing clear notices and allowing contractual opportunities to remedy defaults not only strengthen a party's legal position but also reduce the risk of wrongful termination claims.

Documentation Is the Strongest Defence

Construction disputes are rarely decided by verbal assurances or competing narratives. More often, they are determined by documentary evidence.

Progress reports, site instructions, inspection records, variation orders, payment certificates, meeting minutes, correspondence and delay notices frequently become decisive evidence in litigation and arbitration. Effective record-keeping should therefore be viewed as a core component of project risk management rather than a routine administrative exercise.

A Broader Role for Legal Advisers

The new legal framework also reflects the changing role of construction lawyers. Legal advisers are no longer involved only after disputes arise. Increasingly, they assist clients in drafting balanced contracts, allocating commercial risks appropriately, reviewing contractual notices and ensuring compliance throughout the project lifecycle.

This proactive approach not only minimises disputes but also helps preserve commercial relationships, which is often as valuable as succeeding in litigation.

Conclusion

Federal Decree-Law No. 25 of 2025 marks an important step in the evolution of UAE construction law. Rather than replacing established legal principles, it strengthens them by promoting contractual certainty, commercial fairness and disciplined contract management.

For employers, contractors, consultants and legal practitioners alike, the message is straightforward: successful construction projects are built not only with engineering expertise and financial investment but also with carefully drafted contracts, transparent communication and meticulous project administration. As the UAE's construction sector continues to evolve, those who embrace these principles will be best positioned to navigate both opportunities and disputes under the new legal regime.

As practitioners begin working under the new legal regime, the real impact of the legislation will become evident not only through judicial interpretation but also in day-to-day project administration. Parties that treat contracts as living documents, rather than agreements to be revisited only when disputes arise, will be better equipped to manage risk, preserve commercial relationships and achieve successful project outcomes. In an increasingly competitive construction market, legal compliance and sound contract management are becoming strategic advantages rather than mere procedural requirements.

A Dubai accountant has been sentenced to one year in prison and fined Dh1.47 million after being convicted of embezzling funds from her employer and forging accounting documents to conceal the transactions.

The Dubai Criminal Court also ordered her deportation and confiscated the forged documents. In a separate civil case, the Dubai Civil Court ordered her to pay Dh2 million in compensation to the company, along with 5% annual legal interest from the date the judgment becomes final until full payment.

The case began after the company discovered financial irregularities involving its accountant. It filed a civil lawsuit seeking Dh3,426,449, plus legal interest, after an audit revealed transfers from the company's bank account to accounts held by the employee.

According to the findings, approximately Dh2.95 million was transferred between January 2017 and August 2019 on the stated basis that the money would be used to cover company expenses.

However, a forensic accounting examination found that Dh1.475 million could not be accounted for because there were no supporting documents proving that the money had been properly disbursed.

The investigation also uncovered repeated entries of payment amounts and accounting adjustments that were allegedly used to conceal discrepancies in the company's financial records.

The forensic report identified further violations. These included the establishment of another company while she was employed by the plaintiff without the employer's consent, holding a management position in a third company and allegedly colluding with an accounting firm to conceal the financial manipulation.

The Public Prosecution subsequently referred the accountant to court on charges of embezzling Dh1.475 million, forging unofficial documents and using the forged documents.

The Criminal Court sentenced her in absentia to one year in prison, ordered the confiscation of the forged documents, imposed a fine equivalent to the amount involved in the crime and ordered her deportation from the UAE. The civil claim was referred to the competent court.

In the subsequent civil proceedings, the court relied on the final criminal judgment, the evidence gathered during the investigation and the findings of the expert report in establishing the accountant's liability.

The court found that the company had suffered financial losses after its funds were taken and it was deprived of their use. It also recognised the company's entitlement to compensation for the resulting moral damages.

The Civil Court therefore ordered the accountant to pay Dh2 million to the company as compensation for the total damages suffered. The award was subject to 5% annual legal interest from the date the judgment becomes final until the amount is paid in full. She was also ordered to bear the court fees, costs and legal fees.

The Dubai Civil Court has declared a Gulf national insolvent after he failed to settle debts exceeding Dh4.2 million, following an audit of his liabilities and an assessment of his financial position by an insolvency trustee.

The court had accepted the debtor’s application in February 2026 and initiated insolvency proceedings. It appointed an insolvency trustee to publish the decision, verify the claims against the debtor and prepare a report assessing his financial circumstances.

The audit established that the debtor owed approximately Dh4.216 million to a private hospital, in addition to around Dh18,000 owed to the Dubai Electricity and Water Authority (DEWA). The court subsequently approved the outstanding debts, which totalled more than Dh4.2 million.

The financial assessment also found that the debtor had only about Dh1,200 in his bank account. His only other identified asset was a 2008-model car with an estimated market value of approximately Dh13,000.

The court found that the debtor’s available funds were insufficient even to cover the costs of the insolvency proceedings. The insolvency trustee also found no other assets that could be liquidated and distributed among the creditors.

Based on the findings, the court declared the debtor insolvent and brought the insolvency proceedings to an end after preparing and approving the list of creditors.

As part of the judgment, the court barred the debtor from obtaining new loans or financing, or entering into new financial obligations, for three years from the date of the judgment. The restriction does not apply to obligations necessary to meet his essential needs and those of his dependants.

The court also ordered that his name be entered in the special register of insolvent persons and that Al Etihad Credit Bureau be notified of the judgment.

The Al Ain Civil, Commercial and Administrative Cases Court has ordered a woman to repay Dh248,052 to a man following a dispute over a loan that was only partially repaid.

The case arose after the man filed a lawsuit seeking payment of the outstanding amount. He told the court that he had transferred Dh317,402 to the woman through bank transactions, but received only Dh58,450 in partial repayment. He said that despite repeated requests, she failed to settle the remaining balance, leading him to take legal action.

The court also ordered the payment of legal interest on the outstanding amount, highlighting the consequences of failing to meet financial obligations.

As part of the proceedings, the judge appointed an accounting expert from the Abu Dhabi Judicial Department's approved list of experts to examine the financial transactions between the parties.

The expert concluded that Dh248,052 remained outstanding. The court noted that there were no specific written agreements or contracts between the parties setting out the terms of the financial arrangement. Instead, the expert's assessment was based on the bank transfer records and WhatsApp correspondence submitted to the court.

Before issuing its final ruling, the court required the defendant to take a supplementary oath. At the scheduled hearing, the plaintiff appeared either in person or through a representative and confirmed his willingness to take the oath. He subsequently did so in the prescribed language.

Based on the evidence, the expert's findings and the oath, the court concluded that the defendant was liable for Dh248,052. It therefore ordered her to repay the amount, together with the applicable legal interest.

The Dubai International Financial Centre (DIFC) Courts received 243 opt-in cases during the first half of 2026, accounting for 30% of the 810 cases filed across all divisions.

Of these, 201 cases were filed with the Small Claims Tribunal (SCT), while 42 were filed across the Court of First Instance (CFI), Arbitration Division and Digital Economy Court (DEC). Across the SCT, CFI and DEC, opt-in cases involved UAE-based parties as well as businesses and individuals from 22 overseas jurisdictions spanning five continents.

The figures underline the DIFC Courts’ growing role as a forum for cross-border commercial disputes and highlight the practical role of Dubai’s English-language, common-law commercial court in international dispute resolution, the Courts said.

In addition to their default jurisdiction, the DIFC Courts allow parties to qualifying civil and commercial disputes to opt into their jurisdiction through a written agreement. This option is available to businesses across the UAE, whether or not they are based in the DIFC, as well as to international parties. Parties can opt in through a jurisdiction clause in their contract or a separate written agreement, with no mandatory UAE connection required.

Choosing the DIFC Courts does not alter the governing law of a contract. Parties remain free to agree on the law of their choice, which the Courts will then apply.

Justice Omar Al Mheiri, Director of the DIFC Courts, said: “For businesses operating across borders, the ability to agree a clear and reliable forum for resolving commercial disputes is an important part of doing business with confidence. The H1 figures show that UAE-based and international users are selecting the DIFC Courts for that purpose, including in matters with no UAE-based party. By delivering accessible, digitally enabled and independent commercial justice, we contribute to the confidence businesses need when trading internationally. This confidence supports the ambitions of the Dubai Economic Agenda D33 by reinforcing Dubai’s position as a trusted destination for investment, trade and international business.”

The CFI received 30 opt-in claims in H1 2026. Nearly half (47%) involved at least one party based outside the UAE, with parties from 13 overseas jurisdictions, including Saudi Arabia, Oman, India, Germany, Switzerland, the United States and Australia. In some cases, none of the parties was based in the UAE. The remaining CFI opt-in claims involved UAE-based parties choosing the DIFC Courts.

The Digital Economy Court received one opt-in claim involving parties recorded in the United Kingdom, Saint Vincent and the Grenadines, El Salvador and Vietnam.

The Courts’ international reach was also reflected in the Arbitration Division, where eight of the 11 opt-in cases filed during H1 2026 related to arbitrations seated overseas. These included arbitration hubs such as Singapore, Hong Kong, London, Paris and Stockholm, with parties opting into the DIFC Courts’ jurisdiction in proceedings connected to those arbitrations.

The Courts said the figures demonstrate their role in cross-border dispute resolution, including cases where no party was based in the UAE and proceedings connected to arbitrations seated overseas. The framework is supported by an independent, English-language common-law system and an established enforcement regime.

Corporate restructuring involves changing the legal, ownership, financial or organisational structure of a business to respond to commercial, financial or strategic requirements. In the UAE, this may include a merger, acquisition, share transfer, conversion of a company's legal form, increase or reduction of share capital, transfer of assets or reorganisation of companies within a corporate group.

However, restructuring is not simply a commercial decision. Depending on the proposed transaction, it can trigger requirements under the UAE Commercial Companies Law, applicable licensing and regulatory frameworks, competition legislation, beneficial ownership rules and, where financial distress is involved, the UAE Financial and Bankruptcy Law.

The legal requirements will also depend on whether the business is incorporated on the UAE mainland, in a particular free zone or within a financial free zone such as the DIFC or ADGM. Businesses should therefore identify the legal framework applicable to the entity before proceeding with any restructuring.

What Are the Main Legal Frameworks?

The starting point for most UAE companies is Federal Decree-Law No. 32 of 2021 on Commercial Companies. The law contains provisions dealing with conversion, merger, division and acquisition of companies. It permits a company, subject to the applicable requirements, to convert from one legal form to another while retaining its legal personality. The conversion must be registered with the competent authority.

A merger can similarly involve the consolidation of companies, with the relevant rights and obligations passing to the surviving or newly established entity. The Commercial Companies Law sets out specific procedures for mergers, including requirements relating to the merger agreement, valuation, shareholder approval and registration.

The legal framework becomes more complex where the restructuring involves a regulated activity. A financial services business, for example, may require approvals from its sector-specific regulator in addition to the corporate approvals required for the restructuring itself. Similarly, the procedures for changing shareholders, directors, managers, activities or capital can differ between mainland companies and individual free zones.

Businesses should therefore not assume that a restructuring procedure applicable to one UAE entity will automatically apply to another. The company's legal form, place of incorporation, licensed activities and regulatory status should all be considered at the outset.

Competition law may also become relevant where restructuring involves a merger or acquisition. Federal Decree-Law No. 36 of 2023 on the Regulation of Competition regulates economic concentrations and provides a framework for assessing transactions that may affect competition in the UAE. This means that a qualifying acquisition or merger may require competition-related assessment or notification in addition to the corporate approvals.

Where the company is experiencing financial distress, a conventional corporate restructuring must also be distinguished from formal financial restructuring under Federal Decree-Law No. 51 of 2023 on Financial Restructuring and Bankruptcy. The legislation provides mechanisms intended to enable a debtor to continue its business and address its debts through measures including preventive settlement and restructuring plans. This law does not extend to entities established in the DIFC or the ADGM, which operate their own standalone insolvency regimes under their respective legislation. A company restructuring in either of those centres should therefore assess its position under the applicable DIFC or ADGM insolvency framework instead.

What Corporate and Legal Approvals Should Be Considered?

One of the most important aspects of a restructuring is determining which approvals are required before the transaction can take effect. Depending on the proposed transaction, this may involve approvals from the board of directors or managers, shareholders or partners, the General Assembly and the relevant licensing or regulatory authority.

The company's constitutional documents should be reviewed alongside the Commercial Companies Law. The Memorandum of Association (MOA) and Articles of Association (AOA) may contain specific provisions concerning voting thresholds, transfer restrictions, pre-emption rights, management powers or other matters that affect the proposed restructuring.

This is particularly important where a restructuring changes the company's ownership. A proposed share transfer, for example, should not be treated merely as a private agreement between the seller and purchaser. The parties must consider the company's constitutional documents, applicable statutory requirements and the procedures of the relevant licensing authority for recording the transfer.

A capital restructuring requires similar consideration. Increasing the company's capital may involve issuing additional shares and changing existing ownership percentages. Depending on the circumstances, this can result in dilution for existing shareholders. A reduction of capital can raise separate considerations involving shareholders and creditors.

The legal documentation should also correspond with the corporate approvals. Depending on the transaction, this may include shareholder resolutions, board resolutions, amended constitutional documents, share purchase agreements, merger agreements, asset transfer agreements, powers of attorney and regulatory application forms.

The transaction should only be treated as complete once the required registrations and filings have been completed. A restructuring that has been commercially agreed but not properly registered may leave the company's official records inconsistent with its actual ownership or corporate structure.

What Should Businesses Review Before and After a Restructuring?

Due diligence is a critical part of any restructuring, particularly where the transaction involves the acquisition, merger or transfer of an existing business.

The review should ordinarily cover the company's incorporation documents, trade licence, shareholder records, beneficial ownership information and corporate registers. It should also examine material commercial contracts, financing arrangements, security interests, litigation, intellectual property, employment matters and regulatory compliance.

Contracts require particular attention. A change in ownership or control may trigger contractual notification or consent requirements. Similarly, transferring a business, asset or contractual right may require an assignment or novation rather than simply being included in the restructuring documentation.

Financing documents should also be reviewed for restrictions relating to changes in control, ownership or corporate structure. Banks and other creditors may have rights that need to be addressed before the restructuring is completed.

Employment matters should not be overlooked. Where a restructuring involves the transfer of a business, merger of entities or movement of employees between group companies, the parties should assess the relevant employment, immigration and sponsorship implications.

Intellectual property should also be reviewed. This includes determining whether trademarks, domain names, licences and other intellectual property rights are registered in the name of the entity being restructured and whether any transfer or recordal is required.

Following completion, the company should ensure that all corporate and regulatory records accurately reflect the new structure. This can include updating the trade licence, commercial register, MOA, AOA, shareholder register, authorised signatory records and banking information.

Beneficial ownership compliance is particularly important. Cabinet Resolution No. 109 of 2023 requires legal persons within its scope to maintain and update their Real Beneficiary Register. Where a change occurs, the relevant information must generally be updated within 15 days of the legal person being informed of the change. The Resolution also requires information concerning a change in beneficial ownership to be addressed when ownership is transferred.

A restructuring can also create significant risks for directors and managers. They should ensure that the transaction is properly authorised and that decisions are taken within the scope of their powers. Article 84 of the Commercial Companies Law provides that a manager of a limited liability company may be held personally liable to the company, its partners and third parties for fraudulent acts, misuse of powers, violations of the law or the company's constitutional documents, and gross errors in management. Article 162 confirms that any provision purporting to limit this liability is void.

Where a company is financially distressed, additional caution is required. A restructuring designed to preserve the business should not improperly prejudice creditors or result in transactions that could create liability for the company or its management. In appropriate circumstances, the Financial and Bankruptcy Law provides formal mechanisms for dealing with financial distress and restructuring debts.

Conclusion

Corporate restructuring in the UAE should be approached as a legal and regulatory exercise as well as a commercial one. The first step is to identify the restructuring mechanism and determine which legislation and regulatory framework applies to the company.

Businesses should then obtain the necessary corporate approvals, conduct appropriate legal due diligence, review contractual and financing arrangements, assess regulatory requirements and prepare the necessary transaction documents. Once the restructuring is completed, the company's licences, corporate registers, constitutional documents and beneficial ownership information should be updated to reflect the new structure.

The precise requirements will vary depending on the company's legal form, jurisdiction, industry and proposed restructuring. A transaction that is properly planned and documented from the outset can reduce the risk of regulatory non-compliance, shareholder disputes, contractual breaches and unintended liabilities.

The Abu Dhabi Family, Civil and Administrative Cases Court has ordered a man to pay Dh40,000 in compensation to another man after he was falsely accused of forging a signature, resulting in criminal proceedings against him.

The case arose after the plaintiff filed a lawsuit seeking Dh150,000 in compensation for material and moral damages he claimed to have suffered. He also sought legal interest of 9 per cent from the date the case was filed until full payment, in addition to legal costs, expenses and lawyer’s fees.

The plaintiff alleged that the defendant had deliberately insulted him and unlawfully implicated him in criminal reports and legal proceedings. According to the claim, the defendant filed a criminal complaint accusing him of forging his signature on a document that exempted him from late-payment fines.

The allegation resulted in criminal proceedings being initiated against the plaintiff, exposing him to the consequences of a criminal investigation over an offence he maintained he had not committed.

The case took a decisive turn when forensic examination was conducted on the original document. The forensic evidence report concluded that the disputed signature actually belonged to the defendant, rather than the plaintiff.

Following the forensic findings, the Public Prosecution administratively dismissed the complaint filed against the plaintiff after the allegation was found to be false. The dismissal effectively cleared the plaintiff of the forgery allegation that had triggered the criminal proceedings.

The plaintiff subsequently turned to the civil court, arguing that the false accusation had caused him both material and moral harm. He maintained that being subjected to criminal proceedings on the basis of an unfounded allegation had damaged his reputation and caused him distress and other losses.

After examining the evidence and circumstances of the case, the court awarded Dh40,000 in compensation. The amount was lower than the Dh150,000 originally claimed by the plaintiff, but the ruling nevertheless recognised his entitlement to compensation for the harm caused by the false accusation.

The case highlights the potential civil consequences of making unfounded criminal allegations. While individuals have the right to report suspected offences to the authorities, knowingly or recklessly making false accusations can expose the complainant to legal liability where such conduct causes demonstrable harm to another person.

The ruling also underlines the importance of forensic evidence in disputes involving allegedly forged signatures. In this case, the forensic examination of the original document played a central role in establishing that the allegation against the plaintiff was unfounded and ultimately supported his claim for compensation.

The Dubai Commercial Court has ordered a man to pay Dh6.4 million, representing the value of two cheques issued in favour of another man, together with legal interest of 5% per annum from August 1, 2023, until the amount is paid in full. The defendant was also ordered to cover court fees, expenses and legal costs.

The case was brought before the Dubai Commercial Court by a man seeking payment of Dh6.4 million, along with 5% legal interest from the date the debt became due until settlement.

According to the plaintiff, the defendant had issued two cheques in his favour. The first was for Dh2.2 million and the second for Dh4.2 million, with the cheques due for presentation in July and August 2023.

The plaintiff said the defendant asked him not to present the cheques on their respective due dates, relying on their friendship and repeatedly promising to settle the amounts. Trusting those assurances, the plaintiff did not immediately present the cheques for payment.

By the time the legal period for presenting the cheques had expired, the plaintiff attempted to cash them but was unable to do so because their due dates had passed. He subsequently sent the defendant a legal notice demanding payment of the outstanding amount. When the defendant failed to respond or settle the debt, the plaintiff filed the case.

The plaintiff submitted copies of the two cheques, their return statements, the legal notice and evidence that the defendant had been duly notified. The defendant, despite being legally served, did not attend the court hearings or submit evidence disputing the claim.

The court held that a cheque constitutes evidence of an underlying due debt and noted that the defendant had failed to provide proof that the amount had been paid or that the basis for issuing the cheques had ceased to exist.

In the absence of evidence to the contrary, the court found that the presumption of the outstanding debt remained valid.

The court therefore concluded that the defendant was liable for the full value of the two cheques, amounting to Dh6.4 million. It ordered him to pay the amount, together with legal interest of 5% per annum from August 1, 2023 — the maturity date of the second and final cheque — until full payment.

The defendant was also ordered to pay the court fees, expenses and legal costs.