Abu Dhabi Court of Cassation, Civil Appeals Nos. 208 and 214 of 2023, judgment of 6 December 2023
A final criminal judgment binds the civil courts on the facts it necessarily decided: whether the act occurred, its legal description and who committed it. Where several persons are responsible for a harmful act, the court may order them to pay compensation jointly, equally or in proportion to their contribution (Article 291 of the Civil Transactions Law). A pending criminal case on the same facts is a legal impediment that suspends the period after which civil proceedings lapse. The amount embezzled, if not essential to the conviction, does not bind the civil court, which may still rely on the criminal file as evidence.
Several investors were persuaded to take out bank loans and hand 70% of the proceeds to the defendants, who promised to repay the full loans within three months under a purported investment scheme and gave 'trust receipts' as security. The defendants kept the money. Criminal proceedings followed and three defendants were finally convicted of fraud; the criminal court referred the civil claims to the civil courts. The investors' civil action, claiming various sums and compensation, was suspended in December 2021 pending the criminal judgments becoming final and was revived in June 2023. The courts below ordered the defendants to pay the investors various sums, in one instance jointly.
The Court of Cassation dismissed both defendants' appeals. Under Article 88 of the Evidence Law and Article 269 of the Criminal Procedure Law, a criminal conviction or acquittal binds the civil court on what it necessarily decided about the occurrence of the act, its legal characterisation and its attribution, so liability could not be reopened. Under Articles 291 and 297 of the Civil Transactions Law, where several people are responsible for a harmful act, each is liable for his share and the judge may order payment equally, jointly or severally; criminal punishment does not limit civil compensation. On the defendants' plea that the civil proceedings had lapsed after two years without a valid step (Article 110 of the Civil Procedure Law then applicable), the Court held that this lapse period is not a matter of public order and is subject to suspension and interruption. A pending criminal case based on the same facts obliges the civil court to stay its case under Article 29 of the Criminal Procedure Law and is a legal impediment, so the time while the criminal case was pending does not count. Finally, the precise amount embezzled was not binding on the civil court, but it could use the facts found in the criminal file as evidence in assessing compensation.
Victims of investment fraud can rely on a final criminal conviction to establish civil liability and can recover from all participants jointly. The time taken by the criminal case does not count toward the lapse of their suspended civil claim, so a civil case is not lost because it waited for the criminal proceedings to finish.
| Articles 291 and 297 of Federal Law No. 5 of 1985 (Civil Transactions Law) — text of articles 291, 297 Decided under this law; it has been replaced by Civil Transactions Law 2025. |
| Article 88 of Federal Decree-Law No. 35 of 2022 (Evidence Law) — text of article 88 |
| Article 110 of the Civil Procedure Law applicable to the case (Federal Law No. 11 of 1992) Decided under this law; it has been replaced by Civil Procedure Code. |
| Articles 29 and 269 of the Criminal Procedure Law |
“ولهذا فلا يحسب في مدة انقضاء الخصومة تلك الفترة التي ظلت خلالها الدعوى الجزائية قائمة”Short quotation from the judgment as published by the court. The full judgment is on the court’s official service.
Losing a lawsuit or complaint does not make the claimant liable for abuse of the right to litigate
A person who uses a right lawfully is not liable for resulting harm to others (Articles 104 to 106 of the Civil Transactions Law). Abuse exists only in the cases listed e…
A claim filed against a deceased person can be cured by joining the heirs; rescinded partnership refunds net of sums received
A claim or appeal brought against a person who had already died is not void beyond repair: it may be corrected by joining the heirs at the same level of court, by a memor…
A partner's work cannot pay for a share in an LLC, so a share transfer made for services alone is void
Under Article 17 of the Commercial Companies Law (Federal Decree-Law No. 32 of 2021, corresponding to Article 17 of Federal Law No. 2 of 2015), the capital of a limited l…
A debtor who claims insolvency must prove it; the court must rule on the claim as framed and as characterised on cassation
Insolvency (الإعسار) exists where a debtor's debts equal or exceed his assets; once established, the court may place him under interdiction under Articles 401 and 402 of …
An assignment of a debt cannot be enforced against the debtor who did not consent to it
The bar on cassation appeals against appellate rulings 'in execution procedures' (Article 173(3) of the former Civil Procedure Law) covers only rulings on the measures th…
A worker injured through the employer's fault may sue in the civil court in tort, beyond the labour-law compensation
Compensation for work injuries under Article 37 of the Labour Relations Law and Cabinet Resolution No. 33 of 2022 is a statutory, no-fault entitlement based on risk, calc…
Whether you are establishing a new venture, restructuring an existing enterprise, or exploring residency pathways — we are here to advise.
Arrange a Consultation →