Hardwicke barristers William Frain-Bell and Mohammed Zaman QC of Hardwicke appeared for the successful Claimant in the recent case of Chris O’Donnell v Nakheel in the Dubai World Tribunal.
Chris O’Donnell was Chief Executive of Nakheel, the real estate developer and creator of internationally acclaimed Palm Jumeirah, for five years, until the end of his contract in June 2011. In August 2009 Nakheel was forced into a $16bn restructuring following a collapse in property prices in Dubai.
Mr O’Donnell sued Nakheel for breach of contract, making a claim for around $3.7 million in lost incentives, entitlement fees, interest, exchange rate losses and salary-related claims, which sums had not been paid to him following the end of his contract. Nakheel however argued that Mr O’Donnell resigned before the end of his fixed-term tenure and was therefore not entitled to his five-year incentive payment. Nakheel also disputed that the Dubai World Tribunal had jurisdiction, contending that the case should have been referred to the Dubai Ministry of Labour. William Frain-Bell and Mohammed Zaman QC persuaded the Dubai World Tribunal that it had jurisdiction and that Mr O’Donnell had in fact completed his five-year term. Mr O’Donnell was awarded in excess of $3 million for two unpaid long-term incentive payments which were due, along with other benefits.
This was a significant decision as it illustrated to both Dubai and the rest of the world that the Dubai World Tribunal is an effective dispute resolution forum for a variety of types of action. The lawyers acting for Nakheel argued that the dispute should have been heard at the outset by the Dubai Ministry of Labour and therefore the Tribunal had no jurisdiction to hear the claim. The Tribunal disagreed on the basis that what was being sought by Mr O’Donnell was payment of items due under this contract of employment as opposed to items due under the UAE Labour Laws. As such the Tribunal had jurisdiction to hear the claim.
The Dubai World Tribunal, which is presided over by former UK Court of Appeal judges Sir Anthony Evans and Sir John Chadwick is part of the Dubai International Financial Centre Courts set up in 2009 to deal with disputes involving Dubai World and its subsidiaries which Included Nakheel.