A special tribunal set up to hear disputes over Dubai World’s debt restructuring will no longer hear cases against former unit Nakheel, the Dubai government’s legal affairs department said in a statement on Wednesday.
All disputes and claims against the troubled property developer, which was absorbed by the Dubai government as part of Dubai World’s restructuring plan last year, will now be heard by the Arabic-language, civil law-based Dubai courts “or the alternative competent dispute resolution forum”, the statement said.
In September last year, the special tribunal issued a directive saying the tribunal would exercise jurisdiction in proceedings that had commenced before August 23. The government’s legal affairs department said it had received a number of enquiries requesting clarification on the matter.
Nakheel became embroiled in a number of legal battles as it struggled to finish a $16 billion restructuring, including a $3.7 million lawsuit filed by its former chief executive.
It fought back with a series of claims against owners of islands on its World islands development, including one lawsuit against Kleindienst Properties which demands almost $200 million in unpaid installments and delay fees, according to a filing with the special tribunal.
A flurry of cases were filed in the special tribunal before Nakheel was taken over by the government amidst concerns that future claims would be heard by local Dubai courts that do not abide by British Common Law. However, Decree 16, passed late last year, has opened up the jurisdiction of the common law Dubai International Financial Centre Courts as an alternative to the Dubai Courts.
It is unclear from the statement whether the DIFC Courts would hear cases against Nakheel under Dubai's Decree 16. ALB
Shaheen Pasha is Middle East Regional Editor at ALB. Follow her on Twitter: @ALB_TheBrief.
Other related stories: