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You are here: BAILII >> Databases >> The Dubai International Financial Centre >> Nashtar v Nasiruddin [2024] DIFC SCT 351 (11 October 2024) URL: http://www.bailii.org/ae/cases/DIFC/2024/DSCT_351.html Cite as: [2024] DIFC SCT 351 |
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Nashtar v Nasiruddin [2024] DIFC SCT 351
October 11, 2024 SCT - JUDGMENTS AND ORDERS
Claim No: SCT 351/2024
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
In the name of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Ruler of Dubai
IN THE SMALL CLAIMS TRIBUNAL
BETWEEN
NASHTAR
Claimant/ Defendant in Counterclaim
and
NASIRUDDIN
Defendant/Claimant in Counterclaim
Hearing : 26 September 2024 Judgment : 11 October 2024 JUDGMENT OF SCT JUDGE MAITHA ALSHEHHI
UPON the claim having been filed on 6 August 2024 (the “Claim”)
AND UPON the Defendant’s defence with counterclaim dated 21 August 2024 (the “Counterclaim”)
AND UPON the Claimant’s reply to the Counterclaim dated 28 August 2024 (the “Claimant’s Reply)
AND UPON the Claimant’s further submissions dated 16 September 2024
AND UPON the Defendant’s further submissions dated 23 September 2024
AND UPON a hearing held before SCT Judge Maitha AlShehhi on 26 September 2024 with the Claimant’s representative and the Defendant’s representative in attendance (the “Hearing”)
AND UPON reviewing the documents and evidence filed and recorded on the Court file
IT IS HEREBY ORDERED THAT:
1. The Claim succeeds in part and the Defendant shall pay the Claimant the amount ofAED 39,366.63.
2. The Defendant shall pay the Claimant the DIFC Courts’ filing fee in the amount ofAED 1,968.33.
3. The Counterclaim succeeds in part and the Claimant shall pay the Defendant the amount ofAED 31,250.
4. The Claimant shall pay the Defendant the DIFC Courts’ filing fee in the amount ofAED 1,562.50.
Issued by:
Delvin Sumo
SCT Judge and Assistant Registrar
Date of Issue: 11 October 2024
At: 2pmTHE REASONS
Parties
1. The Claimant is Nashtar (the “Claimant”), a company registered in Sharjah, the UAE.
2. The Defendant is Nasiruddin (the “Defendant”), a company registered in Dubai, the UAE.
The Claim
3. The Claimant (as the contractor) and the Defendant (as the employer) entered into a contract dated 20 February 2024 for the provision of maintenance works to be performed by the Claimant in accordance with the agreed scope of work in return for payment by the Defendant, in the amount of AED 425,000 (the “Contract”).
4. As per the Contract, the duration of the project was set out to be 60 days, and 15 days snagging. However, the Claimant submits that they started working on all warehouses at the same time, as agreed with the Defendant, and so the above timeline applies to work performed for each warehouse individually instead of collectively
5. The Claimant submits that it performed all of its obligations pursuant to the Contract and the Defendant breached the Contract by failing to pay its dues and by descoping one of the warehouses from the Claimant’s scope of work, therefore causing the Claimant to incur costs as it already arranged for the work force.
6. The Claimant contends that it incurred additional costs as a result of the Defendant’s failure to issue gate passes for the Claimant’s workers on time which hindered their ability to start the work on the date agreed and caused further unnecessary delays. As such, the Claimant states that a penalty should be levied in accordance with the terms of the Contract, which reads as follows:
“Penalty:AED 410/per day which shall be capped maximum to 10% of the contract value in case of delay in works beyond stipulated completion of 60 days. and vise versa if any circumstance make delay to start work then employer should compensate to contractor Each and every person 200.00 AED every day.”
7. The Claimant states that they faced delays due to the Defendant’s lack of cooperation. The Claimant alleges that the Defendant failed to inform the security personnel of the attendance of the workers, which caused delays as security refused the workers access to the warehouses. Additionally, the Defendant rejected to permit overtime or provide accommodation and payment for the workers.
8. As to the necessary documentation required for the issuance of the gate pass, the Claimant confirms that the documentation was sent to the Defendant on 26 January 2024 and 4 February 2024 (i.e. before commencement date) and submits that the Defendant was not registered back then in onshore Dubai and could not issue gate passes. In any event, the Claimant confirms that it re-sent the documentation multiple times when requested by the Defendant and was cooperative in doing so, as such, the delay is not attributable to them as the Defendant failed to make the necessary payment to the authority.
9. As per the Contract, the Claimant’s scope of work comprises of five warehouses as shown below:
(a) Maintenance of Warehouse 1 at a cost of AED 48,750.
(b) Maintenance of Warehouse 2 2 at a cost of AED 112,500.
(c) Maintenance of Warehouse 3 at a cost of AED 66,500.
(d) Maintenance of Warehouse 4 at a cost of AED 61,250.
(e) Maintenance of Warehouse 5 at a cost of AED 150,000.
10. The Claimant submits that the Contract amount was a lump sum amount and after applying discount, the agreed amount came to AED 425,000 and that no quantity or measurements was specified in the Contract in respect of the warehouses.
11. Before agreeing on the final version of the Contract, the Claimant adds that several versions were exchanged as the Defendant signed the incorrect version twice which had the contract value at AED 410,000 instead of AED 425,000 which was notified to the Defendant. The Claimant confirms that the final version was agreed upon between the parties and the signatures were affixed accordingly.
12. The Claimant states that their works primarily revolved around rectification and maintenance work as opposed to new installation at the location, and further state that they do not issue any progress report as their work is purely labour work. The arrangement is for the Defendant’s engineer to advise and instruct them on the work required to be accomplished as per the scope of work and they perform it, while the task of sending the report to the Defendant lies with the engineer as per the Contract, and not with the Claimant.
13. The Claimant submits that the Defendant is not entitled to descope any work or warehouse without notifying them 7 days in advance as a result of non-performance and in the event it does, then the Claimant is entitled to 50%. The relevant provision reads as follows:
“any item/work to be descoped by Employer (executed prior to commencements by the Contractor and work value in the contract value), same amount shall not be deducted from the agreement value accordingly”
In this case, the Claimant submits that the Defendant assigned the work of warehouse 2 to another party despite its ongoing performance, as such, the Claimant is seeking 50% of its value from the Defendant (i.e. AED 56,250).
14. The Claimant advances its position that it performed its work on the basis that the Defendant used to pay the submitted invoices and refrained from paying the last invoice only. In addition, the Claimant submits that the Defendant breached the Contract for failing to issue any written notices for any alleged non-performance by the Claimant.
15. The Claimant contends that the Defendant should have terminated the Contract if it was not satisfied with the work instead of leading them on and asking them to continue working, then suddenly accuse them of non-performance and refuse payment.
16. Despite numerous reminders, the Claimant takes the view that the Defendant is withholding payment without legal justification given that the work was carried out with due diligence and met the required specifications, and any defects pointed out by the Defendant were addressed and rectified promptly.
17. The Claimant adds that they were prevented from completing some work as planned due to the Defendant's interference and refusal to provide essential support in terms of providing access to the works in certain warehouses and approving work on the same, as documented in the engineer’s report and WhatsApp communications. Finally, the Claimant submits that the weather condition and rainy season in the UAE resulted in the delay of work and the Defendant was not cooperative in resolving this.
18. Accordingly, the Claimant is seeking payment from the Defendant in the total amount of AED 168,920 which comprises of payment of the final voice (AED 82,670.57), accommodation balance of 3 months (AED 21,000), 50% of value of descoped work of warehouse 2 (AED 56,250) and legal expenses incurred in the amount of AED 9,000.
The Defence with Counterclaim
19. The Defendant takes the view that the Claimant has not performed all of its obligations pursuant to the Contract and all of the delays in works were due to the Claimant’s failure to provide proper valid documentation for issuance of gate pass as requested repeatedly by the Defendant. Thus, surpassing the agreed deadline of 60 days from commencement date of 28 February 2024 (i.e. completion date should have been 12 April 2024).
20. The Defendant raised their concerns of the Claimant’s pace in handling this project and the slow progress as per the WhatsApp chat below dated 26 March 2024:
“ Naqa
@Naqsh Civil Work still canopy is not installed. We can not work like this. We have only 30 days to finish balance work. Pls submit your completion program for all this wear house by end of today.
Naqsh
This is not we agreed.. please refer to our quote. Specifically we mentioned. And sir Nasuh and agreed that we carried out the work mention in photos not entirely warehouse. We can sit Sunday afternoon and clarify this more.
Naqa
Please show if your estimate is approved and signed by us??? That was your estimate. Our signed agreement is to complete the work as per tuv report..
….
We are 15 days up and progress is very verypoor..@NaqshCivil Work as promised you will give me your words that work will be done with perfection.”
21. The Defendant submits that the Claimant altered the Contract in terms of adding new provisions which were not agreed upon. In other words, the Defendant asserts that the Claimant forged the Contract by adding the Defendant’s signature in a version it did not approve.
22. The Defendant asserts that the Claimant was supposed to be working on 5 warehouses, however, 6 months later the work was not completed on any warehouse, breaching the 60+15 day timeframe.
23. The Defendant further asserts that the Claimant failed in sending them progress reports within 5 days as required by the Contract.
24. The Defendant contends that the Claimant’s work was not up to standard as they tried to install a canopy twice and had to paint the walls multiple times, which was also done in poor quality. Additionally, the Defendant submits that the defects and shortcomings included but were not limited to damaged gypsum wall, damaged interlock paver, epoxy flooring not done as per thickness standards and damaged façade cladding and tiles.
25. The Defendant states that due to the Claimant not performing any work in one of the warehouses, it decided to assign warehouse 2 to a different contractor. Therefore, it does not constitute as a descope if no work was done on it and the value of the Contract is adjusted accordingly to AED 312,500 (total value of contract AED 425,000 – value of 2 112,500).
26. Further to the above, the Defendant states that the Claimant accepted this removal as it removed the price for this warehouse when sending its proforma invoice which reads in specific“4 ware house 439000-112500=327000.”and further states that the Claimant failed to deduct the advance payment made by the Defendant from the proforma invoice amount.
27. The Defendant advances its position that it cannot proceed to make any payment for the Claimant in absence of a clearance certificate which is essential to be signed by the engineer and payment can be released accordingly in line with its payment clearance certificate and not the proforma invoice submitted by the Claimant. For this reason, the Defendant’s client rejected the work performed based on lack of clearance certificate which the Defendant submits damaged his reputation and made him incur further costs.
28. Moreover, the Defendant submits that according to the Contract, payments are contingent upon the satisfactory completion of all contracted works and they are entitled to back charge in case of non-performance.
29. In the Defendant’s email dated 5 July 2024 sent to the Claimant, it sets out a number of documents it requires before processing payment which reads as follows:
“Dear Mr Naqsh
Please find attached the Final Payment Certificate. In order for us to proceed with the payment, we kindly request the submission of the following documents:
1- Tax Invoices for all payments received.
2- Site clearance approved by Engineer Natheer.
3- Report accompanied by attached photographs as agreed.
It is important to note that no proforma invoice will be accepted. Furthermore, all payment related communications should be conducted solely through official email correspondence.”
30. Accordingly, the Defendant is requesting the Court to deduct the amount of AED 48,163.38 from the Contract due to the Claimant’s incomplete work and the fact that the Claimant failed to get the invoices approved by the Claimant’s engineer.
31. As to the security deposit, the Defendant asserts that it is entitled to deposit it due to losses incurred as a result of the Claimant’s delayed work.
32. The Defendant submits that there is no provision under the Contract that they must issue a written notice for non-performance as Claimed by the Claimant. On the contrary, the Defendant submits that they are entitled under the Contract to back charge an amount of AED 48,163.38 from the Claimant due to incomplete work as well as request that the Claimant pay them an amount of AED 31,250 for penalty for delay in completion of work over the stipulated deadline.
33. Therefore, the Defendant states that the Claimant is not entitled to any payment due to delay in work, failure to follow required procedure and most importantly poor quality of work in the works completed and is counterclaiming from the Claimant the back charge amount and the penalty amount of AED 31,250 for delay in work for more than 60 days in accordance with the Contract (AED 410 per day).
Jurisdiction
34. The jurisdiction clause is set out in the Contract under title “Other Terms” and is read as follows:
“Any dispute arising out of or in connection with this Agreement, including any question regarding its existence, validity or termination, or relating to any non- contractual or other obligation arising out of or in connection with this Agreement or the consequences of its nullity, shall be referred to the Courts of the Dubai International Financial Centre, which will have exclusive jurisdiction..”
35. RDC 53.2 requires that the Small Claims Tribunal (“SCT”) hear only cases that fall “within the jurisdiction of the DIFC Courts”. The jurisdiction of the DIFC Courts is determined by Article 5(A) of the JAL, which provides a number of limited gateways through which the DIFC Courts have jurisdiction over a claim, which are, as relevant:
(a) Civil or commercial claims and actions to which the DIFC or any DIFC Body, DIFC Establishment or Licensed DIFC Establishment is a party;
(b) Civil or commercial claims and actions arising out of or relating to a contract or promised contract, whether partly or wholly concluded, finalised or performed within DIFC or will be performed or is supposed to be performed within DIFC pursuant to express or implied terms stipulated in the contract;
(c) Civil or commercial claims and actions arising out of or relating to any incident or transaction which has been wholly or partly performed within DIFC and is related to DIFC activities; . . .
(e) Any claim or action over which the Courts have jurisdiction in accordance with DIFC Laws and DIFC Regulations.
(2) The Court of First Instance may hear and determine any civil or commercial claims or actions where the parties agree in writing to file such claim or action with [the DIFC Courts] whether before or after the dispute arises, provided that such agreement is made pursuant to specific, clear and express provisions.”
36. For cases to be heard in the SCT, first, they must first fall within the DIFC Courts’ jurisdiction by engaging any of the jurisdictional gateways set out in the abovementioned Article.
37. Further to the above, the DIFC Courts have jurisdiction to hear and determine the Claim in accordance with Article 5(A)(1)(2) of the JAL on the basis that the jurisdiction clause mentioned in the Contract is clear on the parties’ intention to resort to the DIFC Courts in case of any dispute and is the appropriate forum to hear the Claim.
Discussion
Is the Contract valid?
38. First and foremost, it is important to address whether the Contract is valid on the basis that the Defendant submits that the Contract was forged and not the same Contract signed and agreed upon.
39. The Defendant submits that there are two alterations to the Contract, the first being adding the sentence“and vice versa if any circumstance make delay to start work then employer should compensate to contractor Each and every person 200.00 AED every day”in penalty section and the second being inserting the word“not” between the words “same amount shall” and “be deducted” under heading of “Commercial Terms”.
40. In response to this, the Claimant asserts that the Defendant initially signed the incorrect version which has the amount of AED 410,000 instead of AED 425,000 and the same was disclosed to the Defendant and ended up signing the correct version. The Claimant asserts that the Defendant did not raise any objection apart from the contract value on 13 February 2024 and signed the correct version on 18 February 2024, and the Contract is deemed valid as no other objection was raised nor did the Defendant seek to terminate the Contract when it allegedly first found out about the alteration in July 2024.
41. The Claimant submitted evidence in form of WhatsApp conversation dated 13 February 2024 attaching a document called “Civil Agreement – WH Maintenance” and asked the Defendant“Please sign and stamp quotation also agreement copy need to print on your letter head with your stamp and send back”.On 19 February 2024, the Claimant responded to the Defendant by saying“this also wrong contract not change amount. Please resend”.
42. I find that the Defendant failed to file sufficient evidence to support its argument that the Contract was forged as it is clear that the Contract was sent back and forth for review with the parties several times and the Defendant signed incorrect version twice and finally the final version which is the subject of the case today.
43. Also, the Claimant submitted evidence in form of WhatsApp conversation informing the Defendant that delay in start of work would incur a penalty of 200 per day. If the Defendant was not aware of this provision in the Contract, it should have objected to it.
44. I must agree with the Claimant and order that the Contract is deemed valid for lack of evidence and due to the reason that the Defendant did not seek to terminate the Contract.
45. In any event, allegations of forgery are of a criminal nature and in general the SCT or the DIFC Courts has jurisdiction to deal with claims in relation to civil or commercial matters only. As such, the Defendant’s argument shall be dismissed, and the Contract is declared valid.
Did the Claimant perform all the required works within the stipulated deadline mentioned in the Contract?
46. The Claimant takes the view that due to the non-issuance of the gate pass to enter into the free zone area on time, the Claimant was unable to commence work on time and utilise the time allocated efficiently although it shared the documentation several times before entering into the Contract and upon the Defendant’s requests afterwards.
47. The Claimant adds that despite multiple reminders, the Defendant delayed paying the issued invoices and the Claimant’s workers accommodation as required which led to a shortage of funds, affecting the availability of materials for the work as the Claimant had to pay from its own pocket for the accommodation.
48. The Claimant submits that the Defendant did not allow them to utilise all the available workers for all the warehouses as it did not give permission to work in other warehouses which resulted in having more “idle” workers with less to do, while the Claimant still had to pay them for their time and accommodation which according to the Contract must be borne by the Defendant.
49. Additionally, the Claimant asserts that it requested for more time to complete the work on 22 March 2024 by way of WhatsApp conversation:
“Good afternoon sir,
Please update the working hours timings. As earlier warehouses 1 do not have any problems with the timings. Now they allow only 7 to5pm same in warehouse 5. We requested you earlier to get more hours to work so we can finish work with in our schedule. Kindly do the needful.”
50. The Claimant asserts that according to the engineer's report dated 18 March 2024, the work was not poor as alleged by the Defendant on the basis that any defects identified by the engineer were corrected promptly.
51. The Defendant contends that the Claimant did not share the required documentation on time and the documents provided were not complete as some IDs were expired. The Defendant adds that it asked the Claimant to resubmit the missing documents and specified exactly as to which documents needs to be provided alongside the name of the individual worker, however, the Defendant submits that the Claimant failed to do that on time which resulted in the delay of issuing the gate pass and eventually work.
52. The Claimant submitted further WhatsApp conversation dated 28 March 2024 requesting for payment and asking permission to work for another warehouse:
“progress invoicefor warehouse 1 and warehouse 5. Please ancash progress invoice as its almost one month, warehouse 5 we didn’t expect civil work this much, as you know when sit visit was done that time boundary wall condition not so bad. But after now start the rectification work earlier rain weather make to worse. I am not complaining but currently I am short of fund… I request you to release progress payment to smoothly work flow.. and also I request you to do the needful for next warehouse permission so we cab move our people there. Warehouse 1 and warehouse 5 we continue with less people. Extra people we move in next warehouse. Thanks and regards
Also need accommodation rent coming.. just reminder”
53. Another reminder was sent on 31 March and 4 April 2024 to which the Claimant confirmed“.. now warehouse 3 almost all paint clear.(tomorrow you can see) expect epoxy.. how about warehouse 4 and warehouse 2 … we are on time, delay from your side. Not my side.”
54. As such, the Claimant concedes that had the Defendant been cooperative with them in terms of paying for the material and accommodation on time and granting them approval to work in certain locations in time, they would have been able to finish earlier. However, due to the Defendant’s actions, there was a delay in work and progress.
55. The Claimant relies on the Defendant’s engineer’s report to show that he has progressed work of more than 50% to show steady progress in March 2024. However, as correctly pointed out by the Defendant, the report refers to the work required to be performed up until 23 March 2024 as it states“to be completed by 23 March 2024”.
56. In respect of the delay issue of issuance in gate pass, the Claimant submitted evidence that it provided the required documentation well ahead of time and the Defendant submitted evidence that it requested the Claimant for the missing documents to be sent multiple times, which was done by the Claimant. As the delay was for few days, I am of the view that this issue is not the only factor contributing to the late delivery of the project.
57. Therefore, as the cost of the gate pass lies with the Defendant, I am of the view that it is the Defendant’s duty to make sure that all documents were in order ahead of time an to make sure that it pays the fees to the relevant authorities on time.
58. The duration of the project as set out in the Contract is as below:
“The Time for Completion for the whole of the Works shall be as follows:
Commencement – from the date of issuance of advance payment
Completion – 60 days from the date of commencement + 15 days for snagging”
59. The Contract does not seem to allow for extension of time over the stipulated period and included a penalty provision in the event it goes beyond it.
60. Although the Claimant did request for additional time to finish the project and the Defendant was aware of the Claimant’s progress as they were in direct contract, the fact remains that the Claimant surpassed the 60 days deadline, and the work is not considered complete as the Claimant did not obtain the “taking over certificate form” from the Defendant as required as per the Contract.
61. Therefore, the fact is that the Claimant failed to complete the project within the stipulated deadline of 60 days and there is no provision in the Contract which gives rise to an extension of time request to be submitted by the Claimant nor was any other agreement between the parties to extend the timeline.
Should the Defendant pay the full amount as per the proforma invoice?
62. As to the eligibility of the Claimant’s invoice, the Contract clearly stipulates that“All invoices shall be duly approved by Employers appointed Engineer.”
63. In this case, the Claimant only submitted a proforma invoice which was not approved yet and is the reason why the Defendant refrained from paying in the first instance.
64. However, it is apparent that the Defendant paid the Claimant’s previous invoices even when they were not signed.
65. In any event, I find that delay does not mean that the Claimant should not be paid for the work completed, as the Claimant could not finish all of the work due to the Defendant’s actions. The late delivery of work might entail a penalty but does not mean no payment will be made; there is no provision in the Contract that would suggest otherwise.
66. The Claimant failed to provide an invoice after completing all the work. Therefore, I shall rely on the Defendant’s payment certificate in which it provides that the Claimant is entitled to the amount of AED 27,366.63 as opposed to the Claimant’s proforma invoice.
67. The Claimant’s proforma invoice suggest that the Claimant completed 100% of all work in the amount of AED, however, the Claimant failed to obtain the clearance form from the Defendant’s engineer and confirmed that in fact it could not complete 100% of works due to the Defendant. Taking into consideration the aforementioned, the Court cannot consider the proforma invoice as the full amount cannot be claimed if not all items were completed, and I shall rely on the Defendant’s submission of the unsigned payment certificate.
68. The payment certificate stipulates the following percentage of work done:
“Warehouse 1 – 100%
Warehouse 2 – 0%
Warehouse 3 – 100%
Warehouse 4– 80%
Warehouse 5– 75%”
69. The Defendant further adds in the notes that items 3 and 4 only 70% done but I will not take that into consideration due to the contradicting nature of the information.
70. As such, I shall grant the Claimant the amount stipulated in the Defendant’s payment certificate taking into account 4 warehouses and deducting the advance payment in the amount of AED 27,366.63.
71. As mentioned above, the fact that the Claimant delayed work does not mean that no payment should be made.
72. I am of the view that both parties somehow contributed to the slow progress of the project, mainly due to lack of effective communication.
Is the Claimant entitled to 50% of the value of the descoped warehouse?
73. The relevant provision reads as follows:
“Employer has the right to assign the works (part or full) to any other party in case of non-performance by the contractor and all the costs associated with it shall be back charged to the contractor.”
74. The Claimant submits it is entitled to it 50% of the value in accordance with the above and because it had already incurred costs in assembling a work force and the fact that it requested the Defendant’s permission multiple times to start working on it and the Defendant did not grant it to them.
75. On the other hand, the Defendant asserts that no work was performed due to the Claimant’s slow progress and due to non-performance, it decided to allocate this warehouse to a different contractor.
76. I find that the Contract gives the Claimant the right to assign some works to a different contractor in case of non-performance but there is no reference of 7 days to do so nor that the Claimant is entitled to a percentage of it as claimed by the Claimant. As such, the Defendant was not required to give a written notice before 7 days in case of non-performance.
77. Therefore, I find that the Defendant was entitled to do so as there is no evidence before the Court that the Claimant started working on warehouse 2 , although it requested for permission to work on it but was not granted as per the multiple correspondence submitted by the Claimant asking for permission to start working but there is no proof that actual work started apart from the fact that the Claimant submits that it hired work force which let him incur costs.
78. As to the Defendant’s claim to back charge the Claimant for non-performance, the Claimant failed to demonstrate how it arrived at the amount of AED 48,163.38 as well as the Defendant failed to pay the relevant court fee to include this in the Counterclaim. As such, this Counterclaim shall be dismissed.
79. The Defendant submits that it informed the Claimant at site about descoping to which the Claimant shared an invoice thereafter and adjusted it to reflect 4 warehouses and I accept that as admission from the Claimant that it accepted the descoping.
80. Therefore, I shall reject the Claimant’s claim to claim 50% of the value of warehouse 2 for the reasons set out above.
Which party is liable to pay a penalty in accordance with the Contract?
81. In respect of penalty, the Claimant is requesting the Defendant pay penalty of AED 200 per person for delay in start of work while the Defendant is requesting the Claimant to pay AED 410 for failure to submit project on time (capped at 10% of project value).
82. The Claimant submits that it is entitled to charge this amount as the delay of work was due to the Defendant and it informed the Defendant accordingly. The Claimant relied on the WhatsApp conversation dated 4 March 2024 which reads as follows:
“Naqsh
Dear Sir
As today our team just waiting your permission.. until no have thrush and safety jackets, please make sure tomorrow we get pass and inspection the work before start.. kindly resend me all the pictures file of each warehouse so I make print and cross check all. Delay to starting work cost you 200 AED per person.
Nasuh
We can accept any cost since your document are not complete
U were supposed to give documents one week before”
83. The Claimant submitted screenshot of WhatsApp conversation that it provided the Defendant with the documentation on 4 February 2024, 17 February 2024,27 February 2024 and 4 March 2024.
84. The Claimant did inform the Defendant that delay in payment affects the work progress and the Defendant still delayed paying the invoices and accommodation on time.
85. Further to the above, the Claimant failed to quantify the penalty amount it is seeking and failed to quantify the other damages it is seeking as a result of the delay work. As such, this claim in respect of penalty and damages shall be dismissed.
86. As to the Defendant’s penalty counterclaim, given that the duration of the project went beyond 60 days and the penalty provision did not specify that it needed to be a particular’s party’s fault, I am of the view that the penalty can be levied on the Claimant in the amount of AED 31,250 as the Claimant did not finish the project in the time agreed and no further timeline was agreed upon between the parties.
Who is liable to pay the accommodation fees?
87. As to the accommodation, the Claimant submits that it is entitled to 3 months accommodation for its workers as agreed with the Defendant while the Defendant submits that the Claimant is entitled to two months only in accordance with the duration of the Contract.
88. The Contract at hand does not make any reference to accommodation, however, as per the WhatsApp conversations between the parties, it is apparent that the Defendant has agreed to pay the accommodation fees by virtue of the Claimant following up on the same and the Defendant making the first payment to the Claimant in the amount of AED 6,000.
89. Therefore, I shall grant the Claimant the accommodation fees for two months as opposed to three months in accordance with the Contract duration in the amount of AED 12,000.
Findings
90. The Claimant’s claim in respect of payment for works completed and accommodation fees shall be granted, and the Defendant shall pay the Claimant the amount of AED 39,366.63.
91. The Claimant’s claim in respect for payment of descoped work and damages shall be dismissed.
92. The Counterclaim in respect of back charge amount shall be dismissed.
93. The Counterclaim in respect of the penalty shall succeed and the Claimant shall pay the Defendant the amount of AED 31,250.
94. As neither party was successful in full in its Claim or Counterclaim, I find that the Defendant shall pay the Claimant the DIFC Courts’ filing fee proportionate to the judgment sum in the amount of AED 1,968.33 and the Claimant shall pay the Defendant the DIFC Courts’ filing fee proportionate to the judgment sum in the amount of AED 1,562.50.