Bounced cheque cases don’t end with prison term or a fine in UAE, top Dubai judge clarifies

According to the Legal Order Law No 1 of 2017 which came into effect in December 2017, people with bounced cheques worth less than Dh200,000 can be punished by prosecution without the case being referred to the judges, with the payment of a maximum fine of Dh10,000.

However, Judge Al Hakam said the issuer of a bounced cheque should not think that he can pay the fine and get absolved, as the receiver of the cheque can assert his rights by going to the Civil Court.

“The issuer of the bounced cheque may think all that he needs to do is pay a fine if he can’t settle the case. But the victim can still exercise his rights by opening a civil case against the issuer of the cheque for the amount of the cheque plus compensation. Bounced cheque cases don’t end with paying the fine,” he noted.

According to the judge, under the UAE law, the victim has three years to file the civil case from the time the issuer was convicted and paid the fine.

Judge Al Hakam said the legal order has brought much relief to judges because before it came about, they would be busy looking into thousands of bounced cheque cases in the one-day-court which deals with minor offences.

“I used to look into 300 cases per day in the courtroom. Ninety per cent of the cases were bounced cheque cases. After the Legal Order was issued, only cases worth Dh200,000 or more come to us,” he added.

So what happens when a civil case is filed?

Gassan Al Daye, head of litigation Middle East with law firm Charles Russell Speechlys, said the order fined people accused of issuing bad cheques for amounts not exceeding Dh200,000 between Dh2,000 and Dh10,000 depending on the cheque value. “But paying a fine is not the end to this case, the plaintiff can legally file a civil lawsuit against the person who issued the cheque to claim its value.”

Al Daye added that if the Civil Court rules in favour of the plaintiff, a 12 per cent interest rate will also be added to the value of the cheque starting from its issue date. The accused is obliged to pay the amount.

“The court can also order the accused to pay legal charges,” Al Daye said, adding that the complainant is also entitled to request the court to issue a travel ban against the person who wrote the bounced cheque.

Al Daye said the plaintiff can also request the court to freeze the assets of the accused as a precautionary measure until a final judgement is issued.

According to Dubai Public Prosecution, the Penal Order legislation has further improved the working processes of the Dubai Public Prosecution, enabling it to settle 30,618 cases between November 2017 and the end of 2018.

Dubai’s Attorney-General Essam Eisa Al Humaidan said bounced cheques of up to Dh200,000 represented the highest percentage of cases settled by the Penal Order legislation with 26,765 cases or 87 per cent of total cases, while refusal of payment cases represented three per cent (951) of the cases.

Fines for bounced cheques

In case of Civil Case:

If Civil Court rules in favour of the plaintiff, the accused could be asked to:

Other figures to highlight: