A closer look at judicial fees in the UAE

Whilst some corporates/individuals may have valid claims to pursue before the UAE courts, many may feel trapped for not knowing the applicable court fees and other hidden expenses involved in the litigation process. Some may not even receive a proper explanation of what the applicable court fees are, what is refundable and what is not.

This article provides a comprehensive overview of all types of courts costs, litigation expenses, and hidden expenses that any litigants could come across during the litigation process and, therefore, can outweigh the financial risk involved.

At the outset, there are two critical rules based on which the courts fees are estimated in the UAE:

• First, the court fees are usually calculated based on a percentage of the claim amount in the statement of claim; and

• Secondly, once the claim amount exceeds a specific amount, the court fee is usually capped to a maximum amount regardless of the percentage rule.

The UAE is a federation of seven emirates. All emirates, except for Abu Dhabi, Dubai, and Ras Al Khaimah, are part of a federal judicial system and the federal supreme court based in the capital. Abu Dhabi, Dubai, and Ras Al Khaimah have their own independent judicial systems. In every emirate, the court system consists of three levels: court of first instance (CFI), court of appeal (COA), and court of cassation or supreme court (COC).

The court fees are usually divided to each court level, and each become due and payable at the relevant court level of the case.

Court fees (at each level) are usually paid in advance, otherwise, the court does not accept the registration of the case at the specific level. If fees are not paid on time this, in most cases, will have a negative effect on the case being accepted and may lead to the time bar of certain legal procedures, hence, waiver of the litigants’ rights.

Similar to any governmental service in the country, to file a case before a court in the UAE, the Ministry of Justice imposes a fee covering the judicial service per stage. The table below provides a summary of the court fees and how they are calculated at different levels of litigation before the UAE courts in three different jurisdictions:

Court level	Dubai	Abu Dhabi	Ras Al Khaimah
Court of first instance (CFI)	6% from the claim amount up to a maximum amount of: ·       AED 20,000 if the claim is less than AED 500,000 ·       AED 30,000 if the claim is more than AED 500,000 to 1,000,000 ·       AED 40,000 for claims exceeding AED 1,000,000	5% of the claim amount up to a maximum amount of AED 40,000	10% of the claim amount up to a maximum amount of:·       AED 30,000 for claims up to AED 1,000,000 ·       An additional 5% for any amount exceeding AED 1,000,000
Court of appeal (COA)	50% of the fee paid to court of first instance	5% of the claim amount up to a maximum amount AED 10,000	5% of the fees of the appeal up to a maximum amount of AED 30,000
Court of cassation (COC)	·   AED 3,000 as a deposit ·     AED 2,000 fixed fees ·     AED 1,000 for staying execution request	·     AED 3,000 as a deposit ·       AED 2,000 fixed fees ·       AED 1,000 for staying execution request	·     AED 3,000 as a deposit ·       AED 5,000 fixed fees ·       AED 1,000 for staying execution request
Appeal insurance deposit	AED 1,000	AED 2,000 insurance deposit	AED 1,000 deposit.
Payment order cases	6% of the claim amount up to a maximum amount of AED 40,000 For any claim below AED 500,000 the plaintiff pays only AED 5,125	6% of the claim amount up to a maximum amount of AED 40,000 For any claim below AED 500,000 the plaintiff pays only AED 5,125	N/A
Execution courts	2% of the claim amount with a minimum amount of AED 200 and up to a maximum amount of AED 5,000	2% of the claim amount with a minimum amount of AED 100 and up to a maximum amount of AED 3,000	1/3 of the proportional fee up to a maximum amount of AED 3,000
Dubai settlement dispute centre	3% of the claim amount anticipated values up to a maximum amount of AED 20,000 For unevaluated claims a fixed fee of AED 6,000	N/A	N/A
Employment dispute	5% of the claimed amount up to a maximum amount of AED 20,000	Free of cost regardless of any claim amount	Free of cost regardless of any claim amount
Dubai rental dispute	3.5% of the tenancy contract value up to a maximum amount of AED 20,000	N/A	N/A

 

In addition to the above table of court fees, it is very important to take into consideration the below hidden expenses that litigants come to know only after the case is filed:

In most cases, the court appoints an expert with a specific mandate to review and prepare a report of the case’s facts, documents and financials/amounts in claim. The court usually directs the plaintiff to pay the expert fees within a week time of its decision. Expert fees range between AED 5,000 for small cases up to AED 90,000 for complex construction disputes. Expert fees are refundable, in case of winning the case as the court directs the losing party to pay such expert fees, in addition to the full amount of the judgment.

In some emirates like Abu Dhabi, it is a prerequisite to submit an independent expert report alongside your case’s documents for the court to accept the case registration. Of course, that is an extra layer of cost most of the plaintiffs get to know only at the time of claims registration.

Given that the official language of courts in the UAE is Arabic, the relevant court requires that any document to be submitted must be translated into Arabic. Hence, translation budget should also be considered prior to filing any case and all documents should be relevant and substantial to the case in question to avoid any unnecessary cost.

Whilst the general rule is that the losing party is the one paying the court fees (including the expert fees), the plaintiff should be very careful at the time of calculating its claim amount. The court has a discretionary power to direct the winning party to pay a share of the fees equivalent to the difference between the amount of the final judgment and the original claim amount made by the plaintiff.

For example, in the CFI if the claim amount is AED 1,500,000 the court fees would be AED 40,000 as per Dubai rules. If the final judgment awards the plaintiff AED 500,000 only, the plaintiff may end up, although winning the case, paying 6% of the part not awarded of its claim amount i.e. AED 1,000,000 which gives rise to the maximum court fees of AED 40,000 as per Dubai rules.

The key point here is that litigants should carefully consider the strength and legal merits of their case to avoid unnecessary legal costs.

 

Mohamed Abdelrehiem

Partner – Head of Litigation, Ibrahim & Partners

E: mohamed.abdelrehiem@inp.legal.com

  

Salma Barakat

Paralegal, Ibrahim & Partners

E: salma.barakat@inp.legal.com