By Alessandro Tricoli

In the present climate, with litigation being one of the most required service, claim handlers and legal consultants based in the UAE and dealing with ships arrest are more and more confronted with claims arising from maritime contracts containing express governing law and jurisdiction clauses referring to foreign Arbitration proceedings or foreign jurisdiction in general.

Not surprisingly, according to UAE civil procedure rules, the UAE Courts are exclusively entitled to order summary and conservatory proceedings to be enforced on the domestic level, in spite of the parties agreeing to resolve their disputes by reference to foreign jurisdiction or arbitration clauses.

While the former may constitutes a lesser problem, particularly where the claimant is ready to shift the whole litigation proceedings in the UAE because of the eagerness of the local courts to retain jurisdiction when possible, arbitration clauses may indeed constitute a problem and unless carefully approached may lead to troubled waters when it comes to ships arrest.

The theory is in fact quite simple and similar to the one generally applied by courts all over the world: once the arrest is granted, in order to support the precautionary measure, the claimant is compelled to file an action for the proof of the right invoked, and validity of the summary/conservatory measure granted, within eight days following the date of submission of the arrest application (see Art. 255 paragraph 2 of the Federal Law No. 11 of 1992 as amended by the Federal Law No. 30 of 2005).

The commencement of such substantive action may however in practice become problematical, mainly because UAE courts will not consider the commencement of foreign arbitration proceedings as commencement of a substantive claim as requested by the norm in Art. 255. Accordingly, the arrest will not be sustained by an action in merits and will therefore lapse.

This is somehow a consequence of the civilian influence within the hierarchy of UAE courts, where the concept / structure of Admiralty Courts is missing. Judges are thus more prone to think civilly while not taking into consideration the specificity of maritime affairs.

On the other hands, a substantive action filed before the UAE courts is bound to fail, for even the most naïve of the defendants will be able to point the arbitration clause to the attention of the court, and the action will be dismissed with the arrest thus suffering the same fate as above.

In practice, the turning point consists of differentiating between the action in the merits and the action meant by the said Art. 255 for validating and proving the summary proceedings which have already been decided. The burden of illustrating such difference will fall completely on the shoulders of the local counsel, supported by bilingual legal consultants fully conversant with the maritime subject and able to intervene even before the court to meet the judges and explain the legal intricacies arising from the very peculiar maritime case.

Such task is tailored on a case by case basis and in order to succeed requires a close understanding of the facts of the case and of the practice of the UAE court before which the action is filed, a task that must be shared between legal consultants, well versed into the maritime matters, and local counsels, well aware of the local rules and practice of the court, in order to carefully orchestrate the case at stake and avoid unpleasant surprises.

In summary, the practice has revealed the legal tools to circumvent the apparent legal obstacle, based on the difference between the action held before the UAE courts for the purpose of proving the arrest and the arbitration claim over the merits of the case, and it thus rests only on the ability of the local counsel to seize the opportunity and succeed in sustaining the arrest.

With a good strategy and a wise use of the tools at disposal, therefore, the summary measures can remain in place even in presence of an arbitration clause, but it has to be supported by an action for the proof of the right and validity of those summary measures before the local civil courts while awaiting the issuance/recognition of the foreign award on the merits of the case.