Introduction
The Abu Dhabi Court of Cassation recently rendered a significant judgment in Commercial Case No. 190/2025, addressing important procedural questions related to appeal rights in commercial banking disputes. This ruling highlights critical aspects of UAE civil procedure law, particularly regarding the timing and procedures for filing appeals and counter-appeals. The case provides valuable insights into the procedural safeguards in the UAE judicial system and the strict interpretation of appeal deadlines.
Case Background
The case involves a dispute between a bank (the appellant/defendant) and a commercial entity (the respondent/plaintiff) regarding banking facilities provided for financing projects. The initial claim was filed before the Abu Dhabi Court of First Instance (Commercial Case No. 533/2024).
The respondent alleged that:
- The bank had provided banking facilities to finance assigned projects
- The bank failed to fulfil its contractual obligations
- This failure caused delays in project implementation, resulting in the respondent’s inability to meet obligations to clients
- The disruption of projects and withdrawal from assigned projects damaged the respondent’s reputation
The bank had also allegedly received excess funds that needed to be returned.
First Instance and Appeal Judgments
The Court of First Instance appointed a banking expert who submitted a report. The respondent subsequently amended its claims, requesting:
- Validation of its offer to settle outstanding amounts for two loans
- Release of mortgage security
- Compensation plus 5% annual interest
On December 24, 2024, the Court of First Instance ruled:
- Validating the respondent’s tender and deposit
- Ordering the release of the mortgage
- Ordering the bank to pay Compensation with 5% annual interest
The respondent appealed this judgment (Appeal No. 1661/2024). The bank filed a counter-appeal (Appeal No. 101/2025). However, the Court of Appeal decided the counter-appeal was inadmissible because it was filed after the deadline for the first hearing of the original appeal.
Court of Cassation Ruling
The bank then filed a cassation appeal against both appeal judgments (No. 1661/2024 and 101/2025). The Abu Dhabi Court of Cassation, in its judgment dated March 11, 2025, held:
- Regarding the appeal against judgment No. 101/2025: The Court rejected the bank’s cassation appeal against the judgment in Appeal No. 101/2025 (the counter-appeal that was deemed inadmissible).
- Regarding the appeal against judgment No. 1661/2024: The Court ruled that the cassation appeal against the judgment in Appeal No. 1661/2024 (the original appeal) was inadmissible. The Court reasoned that since the bank did not file a timely counter-appeal against this judgment, the judgment became final and binding on the bank.
Legal Analysis
1. Interpretation of “First Hearing” Under Article 166 of Civil Procedure Law
A central issue in this case was the interpretation of Article 166(1) of the UAE Civil Procedure Law, which states that an appellee may file a counter-appeal “up to the date of the first hearing before the Case Management Office or the Court.” The Court of Cassation endorsed a strict interpretation of this provision, defining the “first hearing” as the first scheduled session where the parties or their representatives appear before either the Case Management Office or the court.
The bank argued that this interpretation was flawed and that the “first hearing” should include subsequent preparatory sessions. The Court rejected this argument, emphasizing that the legislative intent was to provide the appellee with the right to file a counter-appeal only until the first hearing of the original appeal, after which this right expires.
2. Time Limits for Filing Appeals
The judgment underscores the importance of adhering to procedural time limits in the UAE judicial system. According to Article 161 of the Civil Procedure Law, the standard time limit for filing an appeal is 30 days from the issuance of the judgment, unless otherwise specified by law. For counter-appeals, however, the deadline is the “first hearing” of the original appeal.
The Court of Cassation emphasized that these procedural rules are matters of public policy that courts must apply sua sponte, even if not raised by the parties.
3. Finality of Judgments and Res Judicata
The Court’s ruling illustrates the principle that judgments become final and acquire the force of res judicata when appeal rights are not exercised within the prescribed time limits. This case demonstrates how a party may lose its right to challenge a judgment if it fails to file a timely appeal or counter-appeal.
The Court noted that when a party implicitly accepts a judgment by not appealing it within the prescribed period, this acceptance extends to subsequent appellate judgments that merely uphold the first instance judgment.
4. Procedural Representation Requirements
The Court addressed a procedural challenge regarding the appellant’s legal representation, highlighting the importance of proper documentation of legal authority in commercial litigation. The Court confirmed that when an appeal is filed by an attorney, the power of attorney must be properly authenticated and demonstrate a clear chain of authority from the appellant.
Practical Implications
This judgment offers several important lessons for legal practitioners and commercial entities in the UAE:
- Strict Adherence to Procedural Deadlines: Parties must strictly observe the time limits for filing appeals and counter-appeals. Missing these deadlines may result in the loss of appeal rights.
- Understanding of “First Hearing”: The concept of “first hearing” in Article 166 should be understood narrowly as the very first scheduled session of the appeal, not subsequent sessions.
- Proper Documentation of Legal Authority: When filing appeals, attorneys must ensure proper documentation of their authority to represent the appellant, with properly authenticated powers of attorney.
- Strategic Planning for Appeals: Parties should carefully plan their appeal strategies, considering both offensive appeals and defensive counter-appeals within the prescribed time limits.
Conclusion
The Abu Dhabi Court of Cassation’s judgment in Case No. 190/2025 reinforces the procedural rigor of the UAE judicial system, particularly in commercial and banking disputes. The Court’s strict interpretation of appeal deadlines serves the dual purpose of legal certainty and judicial efficiency.
For commercial entities and financial institutions operating in the UAE, this case emphasizes the importance of vigilance in litigation, prompt response to adverse judgments, and strict compliance with procedural requirements. It also highlights the UAE courts’ commitment to procedural justice and the finality of judgments, which are essential components of a stable and predictable commercial legal environment.
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