A new year, a new UAE Civil Procedure Law

On 2 January 2023 the UAE’s new Civil Procedure Law Federal Law 42 of 2022 came into effect (the “New Civil Procedure Law”). It applies to all legal proceedings before the onshore UAE courts that have yet to be decided and repeals Federal Law No. (11) of 1992 regarding the Civil Procedure Code (as amended). It does not apply to lawsuits that have been decided, or postponed for judgment, or appeals filed prior to 2 January 2023 (with some limited exceptions). We have considered below some of the key changes.

Scope for the use of the English language

The official language of the court remains Arabic, and the New Civil Procedure Law confirms that the court shall hear statements of non-Arabic-speaking litigants, witnesses and others through an interpreter after they have taken the oath according to the Law. However, it is now possible for the Chairman of the Federal Judicial Council or the Head of the Local judicial body, to decide that English be the language of trials, procedures, judgments and decisions in respect of certain tribunals that are assigned to hear the proceedings involving specialised matters, specific cases or particular proceedings.

Related to this, there is now a requirement for the claimant to serve a certified translation of the proceedings in English if the defendant's native language is not Arabic unless there is prior agreement between the parties to provide the translation in any other language. This applies to all civil and commercial proceedings, except for labour proceedings initiated by the employee and workers, as well as personal status proceedings.

There is no further clarification of the certain tribunals that might be assigned to hear proceedings involving specialised matters, specific cases or particular proceedings, therefore the circumstances in which the English language might be used for trials, procedures, judgments and decisions remains to be seen.

Service of proceedings

In addition to other methods of service, it is now an option for the process server to serve the proceedings on a defendant by audio or video recorded call, SMS to mobile phone, smart applications, email, fax and other modern means of communication. If the notice is served by audio or video recorded calls, the process server must draw up a report setting out the content, time and date of the call and the details of the call recipient. Such a report shall have the probative force as evidence and shall be enclosed with the case file.

Whilst it has historically been common practice to serve notice of judicial proceedings on an elusive defendant by publication in both a widely circulated UAE daily newspaper published in Arabic, the Case Management Office, judge or chief justice may now permit a defendant to be served notice of the proceedings by publication in a foreign newspaper published in a foreign language, if necessary, where the defendant intended to be served is a foreigner. This provisions is particularly relevant to international businesses who might find themselves notified of the UAE court proceedings which have been issued against them via a local newspaper in their home jurisdiction, which is less likely to be overlooked than a publication in Arabic in a UAE newspaper that they do not readily access.

Where proceedings need to be served outside the UAE, and unless the means of service is regulated by special agreements, foreign service is now deemed to be effective 21 business days from the date on which the diplomatic mission in the relevant foreign jurisdiction receives the letter from the Ministry of Foreign Affairs and International Cooperation's letter containing the proceedings and documents to be served. This is an interesting shift away from the previous requirement to wait for a report that service had been effected via the diplomatic mission in the relevant foreign jurisdiction. The new position is that service is considered to have taken place 21 business days from the date on which the foreign diplomatic mission receives the proceedings to be served from the Ministry of Foreign Affairs.

Appeals to the Court of Appeal

The Court shall hear the appeal “in chambers”, i.e. in private chambers and not in open court, after referral by the Case Management Office. The Court shall decide on the appeal in chambers within 20 business days, by issuing a reasoned judgment or ruling that either the appeal is inadmissible, dismissed or abated, or that the judgment or ruling appealed be affirmed. It may also schedule a hearing for examining the merits, if necessary.

The UAE Court system has historically operated a system whereby appeals to both the Court of Appeal and the Court of Cassation were almost inevitable and litigants could generally always expect two rounds of appeal. In our team’s combined 35 years of UAE court experience we have not seen a UAE court refuse to allow an appeal to proceed except where it is time-barred. The provisions of the New Civil Procedure Law requiring the Court of Appeal to hear and decide on the admissibility of the appeal in chambers suggests that there may now be closer scrutiny of the grounds presented for the appeal and, potentially, less certainty that all appeals will be permitted.

Appeals to the Court of Cassation

The time limit for filing a challenge to the court of cassation is 30 days, which is half of the previous time limit of 60 days and is an important change for parties to be aware of.

Enforcement of bounced cheques

Part 11 of the New Civil Procedure Law relates to Writs of Debt, otherwise known as payment orders. Payment orders are effectively a fast track method of obtaining an ex-parte judgment against a debtor where the debt is confirmed in writing for a specific amount and is not disputed, provided certain procedural formalities have been complied with. However, this section expressly states that a cheque is considered a Writ of Execution (as opposed to a Writ of Debt) under Article 212.2.d of this Code. Article 212.2 relates to Execution Writs. The new law therefore confirms that where a party is unable to cash a cheque because to issuer has insufficient funds, the beneficiary may proceed to enforcement and does not have to file a substantive case to establish its rights in respect of the bounced cheque.

Comment

It is too early to say how the key changes above might operate in practice, particularly issues such as whether the courts will be willing to grant requests by parties for proceedings to be conducted in English and on what grounds. Either way, the changes are clearly geared to improve the efficiency of UAE court proceedings which will always be welcomed by the UAE legal community as well as foreign entities operating in the region. As the practical implications of the New Civil Procedure Law becomes clearer, we will issue further updates.