Dubai Courts To Hear Investor’s Legal Disputes With NakheelThursday, May 24, 2012
The Dubai Legal Affairs Department has recently confirmed that investors who have legal disputes with Nakheel will not have their cases heard at the Dubai World Tribunal but rather Dubai Courts will hear their cases. There was a great confusion for the investors who were intending to take legal action against Nakheel per a statement given by Dubai Legal Affairs Department.
The department has also highlighted that all the cases which embroil Nakheel or any of its subsidiaries will now come under the jurisdiction of Dubai Courts or dispute resolution forum as an alternative. Dubai Legal Affairs added that it was getting numerous enquiries from the investors to clarify the appropriate forum to file cases against Nakheel and so this legal interpretation was necessary to be given.
In October, media reports revealed that the Dubai Department of Legal Affairs issued a decree stating that legal disputes involving Nakheel would be heard by Dubai Courts. Lawyers said that after Nakheel became a government owned firm and left many investors in the dark, it was a simple circular stating that Nakheel related issues would be heard at Dubai Courts.
Jonathon Davidson, founding partner with legal firm Davidson & Company said that the cases of the investors will remain within the tribunal who filed their cases before 23rd August 2011. Since the creation of the tribunal in December 2009 to hear cases related to Dubai World’s debt restructuring, Nakheel has been facing cases from the unpaid buyers and trade creditors. The former Dubai World subsidiary suffered from the property crash, since it overstretched itself with many ambitious projects.
Nakheel said in September that during debt crises, it wrote down AED 78.6 bn from its real estate value. Nakheel involved in legal battles when it struggled to finish US$ 16.1 bn restructuring. This restructuring also included lawsuit of US$ 3.7 m by its former chief executive.