Dubai Court Orders Payment of Dh1.58M Over Unpaid Consulting Fees

Court finds consulting firm fulfilled its contractual obligations and awards outstanding dues plus 5% annual interest.

 

A Dubai Commercial Court has ordered an institution to pay an administrative consulting firm 1.613 million Saudi Riyals (about Dhs1.58 million) in outstanding fees for consulting services, together with 5% annual interest from the due date of each invoice until full payment.

 

The court, however, dismissed the claim against a second company after finding that it was not a party to the consulting agreement and therefore had no contractual liability for the outstanding amount.

 

The case arose in April 2023, when the consulting firm entered into a 12-month service agreement with the institution, renewable by agreement, to provide consultancy services aimed at developing the operational strategies of a holding company. The contract was valued at 3.4 million Saudi Riyals.

 

The consulting firm told the court that it had fulfilled its contractual obligations and delivered the final project files. It claimed, however, that the institution had failed to settle the full amount due.

 

According to the firm, the total value of the work carried out amounted to 5.468 million Saudi Riyals. After accounting for payments made by the defendants, it said an outstanding balance of approximately 1.613 million Riyals remained.

 

The court appointed an accounting expert committee to examine the contractual relationship, payments and outstanding invoices.

 

Based on the expert report, the court found that the consulting firm had performed its obligations under the agreement and that the amount claimed represented unpaid invoices for services that had been provided.

 

The court also examined the position of the second defendant company and found that it had not signed the service agreement. The relevant invoices and statement of account were issued in the name of the first defendant institution.

 

The court further noted that the second company had transferred approximately 1.58 million Saudi Riyals to the consulting firm's account at the request of the institution. The payment, the court found, was made within the framework of the existing relationship between the institution and the company and did not make the second company a party to the consulting contract or liable for the institution's contractual obligations.

 

The court also rejected the firm's request to add the owner of the second company as a defendant.

 

It ordered the institution to pay 1,613,000 Saudi Riyals (approximately Dhs1.58 million), together with interest at 5% per year, calculated from the due date of each invoice until the outstanding amount is paid in full.

 

The court also ordered the parties to bear the appropriate litigation expenses and attorney fees, while rejecting the remaining claims.