Question: Two years ago, I signed a contract to build and manage a property with a company but we are now in a dispute. The contract says that in the event of a dispute, jurisdiction and resolution of the dispute will be through an arbitrator. Does this mean I cannot register a case before the court?
Answer: You cannot file a case in court if you have signed an arbitration agreement.
If the contract includes an arbitration clause, then it means you have agreed not to pursue any legal action in court. The matter must be arbitrated, rather than taken to court.
Arbitration is not an exceptional means of resolving disputes but an alternative means that is followed once its conditions are satisfied. Arbitration is a matter of the parties’ intent and giving expression to their intent in a written agreement, whether in the form of a separate agreement or as a clause within a contract. In all cases, the law requires that such agreement be evidenced in writing.
The parties can waive this agreement through mutual assent, but if either party refuses to do, the matter must be submitted to arbitration and the court will dismiss any lawsuit that is filed outside of the arbitration process.
Article (8) of the Federal Law No. (6) Of 2018 on arbitration, under the section of “Resolution of a Dispute that is Subject to an Arbitration Agreement”, states, “The court before which a dispute is brought that is subject to an arbitration agreement shall decline to entertain the action if the defendant has so pleaded before submitting any request or plea on the merits, unless the court is satisfied that the arbitration Agreement is void or incapable of being performed”.
Article (52) of the above Arbitration Law provides that a UAE arbitration award has a binding force upon the parties to the award and is enforceable as a judgment of the UAE courts. Effectively, the ruling of the arbitrator(s) becomes like a new contract by which the parties agree to conduct themselves.
“An arbitral award made in accordance with this law shall be binding on the parties, constitute res judicata and be as enforceable as a judicial ruling, although to be enforced, a decision confirming the award must be obtained from the court.”
The Dubai Court does not extend to discussing the dispute or deciding on other applications other than confirming the award, considering the arbitrators’ ruling, after meeting the conditions of its validity, as a judgment.
Enforcement of the arbitration award as per Article (55) requires the following procedures:-
1. A party looking to enforce an arbitral award shall submit a request for its confirmation and enforcement with the chief justice of the court, together with the following: (a) The original award or a certified copy thereof. (b) A copy of the arbitration agreement. (c) An Arabic translation of the arbitral award, attested by a competent authority, if the award is not issued in Arabic. (d) A copy of the minutes of deposit of the award in court.
2. The chief justice of the court or whoever he delegates from among its judges shall order the arbitral award confirmed and enforced within 60 days of submission of the request for its confirmation and enforcement, unless it finds one or more of the grounds for setting aside the award under Section 1 of Article 53 of the Arbitration Law.
Section 1 of Article (53) refers to how to challenge arbitral awards by an action for setting aside before the court or during the pendency of an application to confirm the award. The party seeking to set aside the award must establish one of the circumstances mentioned in the article. Moreover, the court shall, on its own initiative, set aside the arbitral award if it finds that the subject matter of the dispute is not capable of settlement by arbitration or finds that the arbitral award is in conflict with the public order and morality of the state.
As a conclusion, the contract is the law of the contractors. It is freely offered and bargained so that each party offers the conditions that are deemed suitable, but when the other party accepts it, he is bound to the agreement.
