UNITED ARAB EMRITES Law and Practice Contributed by: Ali Dakhlallah, Karen Seif, Matthew Page and William Prasifka, Habib Al Mulla & Partners
To obtain interim relief, a claimant must show urgency and a prima facie right deserving protection. Courts do not examine the merits in full but assess whether harm would result if protection is refused. Security may be required to compensate the defendant if the claim ultimately fails. Interim relief is commonly sought in commercial disputes, particularly in debt recovery and enforce- ment focused litigation. It is often strategically impor- tant due to enforcement challenges once assets are In commercial litigation, the primary form of final relief is monetary judgment, ordering payment of sums owed. Courts may also grant declaratory relief con- firming contractual rights or obligations. In appropriate cases, courts may order termination or rescission of contracts. Specific performance is available but granted spar- ingly. UAE courts generally prefer monetary compen- sation unless performance is feasible and equitable. Courts may also confirm or lift interim measures as part of final relief. moved offshore. 2.7 Final Relief Enforcement orders, including attachment and exe- cution against assets, form a significant part of final relief. Courts may also impose travel bans on debtors to prevent them from leaving the UAE pending sat- isfaction of the judgment, and in appropriate cases, arrest warrants may be issued to compel compliance with court orders. Judgments may be immediately enforceable or subject to appeal-related stays. UAE courts focus on restoring the claimant to the position they would have been in absent breach. Punitive or exemplary relief is not available. Relief in UAE courts is remedial and compensatory rather than punitive in nature. 2.8 Damages Damages in UAE courts are assessed on the basis of actual and proven loss. The claimant bears the bur- den of demonstrating financial harm directly resulting from the defendant’s breach or wrongdoing. Courts do not award speculative or hypothetical losses. Moral
and reputational damages are recognised in principle under UAE law and may be awarded where the claim- ant demonstrates non-pecuniary harm; however, such awards are typically modest in quantum. Expert evidence plays a central role in calculating damages. Court-appointed experts assess financial records, lost profits and other quantifiable losses, and their reports significantly influence the court’s find- ings. Judges are not bound by expert opinions but rarely depart from them without strong reasons. Contractual penalty clauses are enforceable but sub- ject to judicial scrutiny. Courts may reduce an agreed penalty amount if it is disproportionate to the actual harm suffered. This power is exercised frequently in commercial disputes. Interest may be awarded, subject to statutory limits and the nature of the transaction. As regards litigation costs, court fees are generally reimbursed to the suc- cessful party; however, attorney fees are awarded only on a nominal basis, typically in the range of AED1,000 to AED3,000, unless the parties have contractually agreed to a higher fee-shifting arrangement. Overall, damages assessment in the UAE is conservative and grounded in documentary evidence rather than adver- sarial argument. Arbitration is highly prevalent in the UAE and is one of the most commonly used dispute resolution mecha- nisms for commercial disputes. The UAE’s position as a regional and international business hub has led to widespread inclusion of arbitration clauses in com- mercial contracts, especially in cross-border transac- tions. Businesses often prefer arbitration to avoid the perceived unpredictability and formality of onshore court litigation. Arbitration is most frequently opted for in international and high-value disputes where neutrality, confidential- ity and enforceability are crucial. It is also favoured by multinational companies that wish to avoid local court procedures conducted in Arabic. As a result, most 3. Arbitration 3.1 Prevalence
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