Commercial Appeal Lawsuit Federal Supreme Court
Commercial Appeal Lawsuit Federal Supreme Court

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Landmark Ruling: Federal Supreme Court Nullifies Decision, Terminates Agreement, and Awards Fees

The United Arab Emirates is considered one of the most attractive countries for investments, domestically and internationally. As a result, numerous commercial transactions take place between individuals and companies, which may lead to disputes that prompt one party to seek their rights through the Court.

This is exactly what happened in this case, where the distributor filed the original lawsuit and our law firm, Al-Safar & Partners, was approached by the principal to assist in his claim and help him obtain his rights by canceling the distributor agreement. The principal was aware that our firm houses a wealth of legal expertise in various fields of law, capable of recovering our clients’ rights before the judiciary.

Facts of the appeal lawsuit:

The facts were obtained from the documents of the appealed Judgment and all the appeal papers. The principal (our client) filed the lawsuit, seeking the annulment of the decision of the Commercial Agencies Committee, the termination of the Distributor Agreement, and a Judgment in his favor for compensation. In his explanation of the claim, he stated that he had agreed with the first respondent (the defendant) to distribute construction equipment manufactured by the Principal (our client). However, he was surprised to find that the appointed Distributor Agreement  (the defendant) was promoting products contrary to the terms of the Distributor Agreement. Additionally, the Distributor Agreement failed to achieve the agreed sales volume and delayed payment of the dues owed. The principal (our client) lodged a complaint before the Commercial Agencies Committee to cancel the Distributor Agreement, but the appealed decision rejected the request, which led to the filing of the lawsuit. The Court ruled in favor of rejecting the lawsuit.

As the principal (our client) did not accept this Judgment, she appealed it, and the Court upheld the first-degree Judgment.

Subsequently, the principal (our client) lodged an appeal before the Federal Supreme Court, which overturned the appealed Judgment and referred the Appeal to the Abu Dhabi Court of Appeal for reconsideration by a different panel.

Accordingly, the appeal was referred to the Court of Appeal, which rejected it and upheld the Judgment of the first-degree Court.

The principal (our client) then filed a tilted appeal before the Federal Supreme Court, which, in its first session, overturned the appealed Judgment and ordered the distributor  (the defendant) to bear the expenses of the commercial agencies for canceling the Distributor Agreement. The Court issued the Appealed Decision, rejecting the Appeal, and subsequently scheduled a session to hear the case. In this session, the Court ordered the referral of the lawsuit to an expert, and after the expert’s report, the appeal was discussed in subsequent sessions leading to the final Judgment.

Judgment of the Federal Supreme Court:

The judgment established that enough Distributor Agreement is binding on the parties, and the principal can terminate or not renew the Distributor Agreement If there is a substantial reason justifying its termination or non-renewal according to the provisions of Federal Law.

The panel of judges clearly understood the facts of the case as per the second expert report and also confirmed the rights of the principal. as it established the Judgment on what it is reassured of the governing law and has demonstrated the truth based on valid reasons, refuting those statements and arguments of the distributor and rendering them irrelevant.

Based on the above and the expert’s report, the Federal Supreme Court ruled to annul the appealed decision, along with its consequential effects, including the termination of the Distributor Agreement and the rejection of other claims, and the distributor who was ordered to pay fees, expenses, and an amount of attorney fees for the principal.

This Judgment was a victory for the rights of our client and the efforts we exerted on her behalf to achieve this Judgment. Our law firm, Al Safar and Partners spares no effort in striving for the rights of our clients.

For further assistance please contact  Al Safar and Partners Law Firm. on +971.4.4221944 email reception@alsafarpartners.com –  dubailawyers.ae

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