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In the Name of Allah, the Most Gracious, the Most Merciful
In the Name of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Ruler of Dubai
Dubai Court of First Instance
At the public session held on 21-09-2023 at the headquarters of the Dubai Court of First Instance in Dubai
In Case No. 1188 of 2023 Labor
Plaintiff:
L.S.A.
Defendants:
- T.G.M.T. LLC
- D.L.N.B.
The Court issued the following judgment:
After hearing the pleadings and reviewing the documents:
The facts of the case are summarized as follows: The plaintiff (Layal Salim Al-Akoury) filed this case against the defendants (The Giving Movement Trading LLC) and (Dominic Liam Noel Barnes) by means of a statement of claim filed and registered with the Minor Court Department on 26-01-2023 and legally served. At the hearing on 08-08-2023, the plaintiff submitted a memorandum amending her requests, so that her final requests became a judgment obligating the defendants to pay her an amount of (8,911,200 dirhams) with 5% interest, fees and expenses.
This was based on the assertion that she worked for the defendant under a contract starting from 08-05-2021 with a total salary of (70,000) dirhams, including a basic salary of (60,000 dirhams), in addition to a basic incentive for assuming the duties of CEO at 2% of the company's value when achieving more than 15 million US dollars in revenue for the first defendant. She remained in her job until 19-11-2022, and the defendant refrained from paying her following labor entitlements:
- Leave allowance of 90,000 dirhams from 09-05-2021 to 19-11-2022
- Arbitrary dismissal compensation of 210,000 dirhams
- Profit share due to the plaintiff in the amount of 8,611,200 dirhams at 2% of the company's value
This prompted the plaintiff to submit her complaint to the competent administrative authorities, which sought to settle the dispute amicably but failed to do so, so they referred it to this court. The case file included the following attachments:
- Copy of the employment contract
- Labor case statement issued by the Ministry of Human Resources and Emiratisation
- Copy of the worker's complaint
- Copy of the defendant's trade license
- Copy of the worker's wage report
- Other documents reviewed and comprehended by the court
Whereas the case was deliberated in sessions as recorded in its minutes, and at the session on 14-02-2023, Attorney Taher Abdin, representative of the defendants, stated that he had submitted a memorandum and portfolio of documents. At the session on 18-04-2023, the court ruled in presence, and before deciding on the merits, to appoint an accounting expert from those on rotation according to the operative part of that judgment. At the session on 08-08-2023, it was found that the report was submitted on 20-06-2023, and the court decided that it was satisfied with the expert report based on its reasons when deciding the case. The plaintiff's representative also stated that she had submitted a memorandum including an amendment to reduce her requests. The defendants' representative stated that he had submitted a memorandum and portfolio of documents and also pleaded lack of jurisdiction of Dubai courts to hear the case and that jurisdiction belongs to the Abu Dhabi Global Market Courts. The court reserved the case for judgment for today's session.
As the parties to the case were each represented by an agent (lawyer), the judgment regarding it shall be in presence pursuant to Article 54/1 of Federal Decree-Law No. 42 of 2022 issuing the Civil Procedure Law.
Whereas the court prefaces its ruling that it is established in the jurisprudence of the Court of Cassation that the court is bound by the final requests in the case, so there is no consideration for the requests contained in the statement Labor Appeal 34/2007 session 28/4/2008. As the plaintiff's final requests were as stated in her memorandum submitted at the session on 08-08-2023, they shall be the final requests presented to the court and by which it is bound in deciding the case.
Regarding the request to join Mr. Dominic Liam Noel Barnes - in his capacity as the director and owner of the defendant - to the case, Article 94 of the Civil Procedure Law indicates that the plaintiff has the right at any stage of the case to join in the existing litigation before it those who could have been joined in it when it was filed, requesting that they be obligated with the rights he claims against them related to the same subject matter of the case directed at the original defendant. If the plaintiff submits such a request to the court and it instructs him to notify the party requested to be joined, and he is actually notified in the manner prescribed by law to be judged on the requests directed to him by the plaintiff, then the procedures will have been completed correctly by joining him as a party to the case. The plaintiff is not obligated in this case to follow the usual procedures for filing the case stipulated in Article 42 of the same law, which is depositing its statement with the court clerk before notifying him of the requests therein, as the legislator did not obligate the plaintiff to do so in accordance with the wording of the first part of Article 94 referred to [Civil Appeal No. 112 / 2004]. As the plaintiff has joined the aforementioned director of the defendant to the case, while the defendant and the second defendant argued that he (the director) lacks capacity in the case as it was filed against someone without capacity since it is a limited liability company and he is not liable in his personal financial capacity for the company's dealings, and upon the court's review of the defendant's license, it was found to be a limited liability company and that the second defendant is its director, and therefore it is not permissible to join its director. Thus, the court rules that the plea is valid and rejects joining the director of the defendant to the case without the need to state this in the operative part.
Whereas the court prefaces its ruling that it is established in the jurisprudence of the Court of Cassation that ascertaining and understanding the facts of the case is within the authority of the trial court, which independently examines and assesses all evidence and documents duly submitted to it, as long as its conclusion is sound, derived from what has a fixed origin in the papers and leads to the result reached by the judgment, and is sufficient to support its ruling Labor Appeal 38, 45 of 2008 session 15/1/2008. The trial court independently ascertains and understands the facts of the case and assesses the evidence presented therein, including the report of the expert appointed by the court, when it is satisfied with it and finds in it what is sufficient to form its belief without being obligated to respond with special reasons to the objections raised by the litigant on the report and without being obligated to return the assignment to him or appoint another expert or refer the case for investigation, as in its adoption of it indicates that it did not find in the litigant's defense anything that undermines the validity of the report as long as it based its judgment on plausible reasons that have their fixed origin in the papers [Commercial Appeal No. 300, 304 / 2008]. The trial court has the right to rely in its ruling on the report of the expert it appointed when it is convinced by it and sees that it has examined all points of dispute in the case, and it is not obligated to respond independently to the objections directed by the appellant to that report, because in its adoption of it based on its reasons indicates that it did not find in those objections anything that deserves a response beyond what was included in the report. When the trial court bases its ruling on what is sufficient to support it, it is not thereafter obligated to discuss in its judgment every non-legal presumption presented by the litigants, nor is it required to cite all the arguments of the litigants and refute them, as the establishment of the truth it was convinced of and cited its evidence is the dropping response to any argument that contradicts it [Civil Appeal No. 217 /2009]. As the court has previously decided that it is satisfied with the expert report based on its reasons when deciding the case, and regarding the nature of the employment contract, as it is established from the employment contract that it is of indefinite duration and thus the court relies on that, and regarding determining the start date of the plaintiff's work for the defendant, as the expert concluded that the plaintiff's start date of work was on 09-05-2021 and thus the court relies on that, and regarding the end of the plaintiff's service with the defendant and the reason for its termination, it is established (that inferring whether the employer arbitrarily dismissed the worker or not is one of the factual matters that the trial court independently assesses with its authority to understand the facts of the case and assess the evidence and documents presented therein when it bases its ruling on plausible and sufficient reasons to support it Appeal No. 22/ 2010 - Labor Appeal and 23/ 2010 - Labor Appeal). As such, and as the plaintiff stated that the defendant terminated the plaintiff's services on 21-08-2022 with a notice period so that her last working day would be on 19-11-2022, while the defendant stated the following (we find that the first defendant dismissed the plaintiff before resorting to the labor office, which means that the conditions for terminating the employment contract in an illegal manner required by the aforementioned article were not met, as the reason for dismissal was due to the plaintiff's failure to perform her duty, and not taking heed of the warnings and notices directed to her, and the continued influx of complaints against the first defendant before the Department of Economy and Tourism in Dubai. In addition to all that, the first defendant, despite all that, paid the plaintiff's salaries for the agreed notice period of three months, and we are content with that without elaborating on document No. (9) attached to this memorandum). As the expert concluded in this regard the following (The plaintiff began her work with the first defendant on 9/5/2021 and continued to work until the first defendant terminated the work on 21/8/2022 and granted the plaintiff a notice period of three months so that the plaintiff's last working day was 19/11/2022), the court thus decides that the plaintiff's services were terminated in accordance with the correct law with a notice period in accordance with Article 43 and not for reasons of Article 47 of Decree-Law No. 33 of 2021 regarding the regulation of labor relations and that the date of the end of her work was on 19-11-2022, and that the duration of the plaintiff's service with the defendant reached (one year, six months and 10 days). Regarding the plaintiff's wage, as the expert concluded that her total wage is 70,000 dirhams, of which the basic wage is 45,500 dirhams, and thus the court relies on that.
On this advanced basis, the court decides on the merits of the case.
Regarding the request for leave allowance of 90,000 dirhams from 09-05-2021 to 19-11-2022, as it is established by virtue of paragraph (1) of Article (29) of Federal Decree-Law No. 33 of 2021 regarding the regulation of labor relations that (...the worker is entitled to annual leave with full pay of not less than: a. Thirty days for each year of his extended service, b. Two days for each month if his service period exceeds six months and is less than a year, c. Leave for parts of the last year he spent at work, in case his service ends before using his annual leave balance), and paragraph (6) of the same article stipulated that (the worker is entitled to wages for the period of his annual leave) which is the total wage, and paragraph (9) of the same previous article stipulated that (the worker has the right to obtain the wages of the days of leave due if he left work before using them, regardless of their duration, in proportion to the period for which he did not obtain his leave, and he is entitled to leave wages for parts of the year in proportion to what he spent of it at work, and it is calculated according to the basic wage). It is judicially established that the burden of proving that the worker has obtained his annual leave or compensation for it falls on the employer [Labor Appeal No. 1, 3 of 2009]. As the plaintiff claims it for leave allowance for the above period, and as the expert concluded in this regard that the plaintiff obtained all her leave during the work period, thus the court rules to reject the request.
Regarding the request for arbitrary dismissal compensation of 90,000 dirhams, as it is established in the jurisprudence of the Court of Cassation that inferring whether the employer arbitrarily dismissed the worker or not is one of the objective matters that the trial court independently assesses without supervision from the Court of Cassation when it bases its ruling on plausible reasons that have their fixed origin in the papers and are sufficient to support it (Appeal No. 60/2018 Labor session 18/6/2018). Inferring whether the employer arbitrarily dismissed the worker or whether the justification he provided was serious is within the authority of the trial court which has the right to this assessment (Appeal No. 33/2016 Labor session 7/6/2016). The employer's breach of his contractual or legal obligations, including not paying the worker his full wage at the times prescribed for that, which prompts the worker to terminate the employment contract, is a form of arbitrary dismissal that allows the latter to request compensation and all his rights arising from the termination of his employment contract (Appeals No. 72, 76/2017 Labor session 23/5/2017). Article 47 of Decree-Law No. 33 of 2021 regarding the regulation of labor relations explicitly stated two cases of unlawful termination by the employer: if the termination of the worker's service is due to submitting a serious complaint to the Ministry or filing a lawsuit against the employer that is proven valid, and obligated the employer to pay fair compensation to the worker according to the court's assessment, taking into account the type of work, the amount of damage inflicted on the worker and the duration of his service, provided that the amount of compensation does not exceed the worker's wage for a period of (3) three months if it is proven that the dismissal was unlawful according to the two cases. The law in its entirety was devoid of stipulating compensation for unlawful termination or what is called compensation for arbitrary dismissal in other than these two cases. Therefore, the plaintiff's request in this regard is without legal basis regulated by the Decree-Law for regulating labor relations. Pursuant to Article (73) of the aforementioned Decree-Law, which ruled to cancel any provision that contradicts or conflicts with the provisions of this Decree-Law, the court thus rules to reject the request.
Regarding the request for profit share due to the plaintiff in the amount of 8,611,200 dirhams at 2% of the company's value, as the plaintiff submitted the above request, and as the court referred the case to expertise which concluded in this regard the following (There is an agreement between the parties that the plaintiff obtains 2% of the first defendant's shares in case the first defendant achieves revenues of 15,000,000 US dollars in 2021. The first defendant achieved revenues exceeding the specified amount in 2021. The Giving Movement Holding Limited, the company owning the first defendant, issued a certificate to the plaintiff whereby it certifies that the plaintiff has possession of all or part of the shares numbering 244,022 shares on the basis of an exercise price of 0.00 US dollars, which is equivalent to 2% of the first defendant's shares. Consequently; the plaintiff becomes entitled to possess all or part of the first defendant's shares at a rate of 2% since 1/1/2022. From an accounting perspective; the plaintiff has the right to possess the shares and then the rights resulting from possession such as sale, assignment, and obtaining distributed profits since 2022 - if there is distribution - ... etc. and the plaintiff is not entitled to obtain the value of the shares in cash from the first defendant. Accordingly; no financial amounts are owed to the plaintiff, and she has the right to possess shares at a rate of 2% of the first defendant. Therefore, it concludes from all of the above and rules that the plaintiff is entitled to possess all or part of the first defendant's shares at a rate of 2% since 1/1/2022 and then the rights resulting from possession and the plaintiff is not entitled to obtain the value of the shares in cash from the first defendant according to what will be stated in the operative part of this judgment).
Regarding expenses and fees, the court obligates the defendant to pay what is appropriate thereof pursuant to Article 135 of Federal Decree-Law No. 42 of 2022 issuing the Civil Procedure Law.
For these reasons
The court ruled in presence that the plaintiff is entitled to possess all or part of the first defendant's shares at a rate of 2% since 1/1/2022 and then the rights resulting from possession and the plaintiff is not entitled to obtain the value of the shares in cash from the first defendant. It obligated the defendant to pay the appropriate fees and expenses and rejected other requests.