In the Sultanate of Oman, as in other jurisdictions, not every litigation matter proceeds all the way to a decision by the Court. What happens if the parties to an Omani court case reach a settlement in the middle of the litigation process?
Sadly, this rarely happens in Oman, primarily because the Omani system has no concept of “without prejudice” negotiations. Furthermore, the fact that the losing party does not have to pay the winner’s legal fees is another reason why Omani court cases often go the full distance to a Supreme Court judgment.
However, settlements can and do occur. The settlement is normally recorded in full detail in a settlement agreement which is in Arabic and signed by the parties. The respective lawyers of the litigant parties normally present the settlement agreement to the Court, and ask the latter to adopt the agreement as the terms of a “settlement judgment” between the parties. This means that the Court gives a judgment, stating that the parties have settled the dispute on the terms stated in the settlement agreement.
In this way, the terms of the settlement agreement become part of the actual text of the Court judgment. The result is that, if one party then breaches the settlement agreement, the innocent party can apply to the Enforcement Department to enforce the terms of the settlement agreement.
It also should be noted that the above mechanism requires that the advocates for both sides be in possession of powers of attorney from their respective clients which empower them to settle the dispute. This is necessary in order to make the request to the Court to adopt the agreement as the terms of a “settlement judgment.”
Tuesday, December 13, 2011
Focus on Litigation: Settlements
Tuesday, August 9, 2011
Focus on Litigation: Joining Co-Defendants
A defendant in an Omani court case always should consider whether the culpability in fact lies with a party who has not been named as a defendant by the Claimant.
The ability for a defendant in an Omani court case to join in co-defendants is more straight-forward than might be appreciated. This applies equally to joining in Omani and non-Omani parties.
The procedure for joining a co-defendant involves the named defendant making a paper application to the court, attaching copies of the commercial registration documents in respect of the prospective co-defendant(s). This corporate documentation should be obtained from the relevant public register in the country where the entity in question is incorporated.
The defendant also needs to provide the court with full addresses in respect of the co-defendants. Accordingly, we habitually advise that a written Defence always should start with procedural defences, and also should include substantive defences as well.
Provided that a prima facie case is made out, the Omani courts are usually willing to join the other parties into the existing court action as co-defendants.
As an important caveat, we should mention that joining a non-Omani entity may delay the case by some months, as the Omani courts serve such entities with the documentation via diplomatic, country-to-country channels.
Thursday, July 21, 2011
Focus on Litigation: Raising Procedural and Substantive Defences
When defending against litigation proceedings in Oman, it is crucial not only to formulate the right defences, but also to deploy them at the right time.
It is a little-known point of Omani law that, in any Omani court litigation, all procedural defences must be stated at the beginning of the very first defence submission.
For example, if the Defendant has an argument that the Oman Courts should decline jurisdiction to hear the dispute, this contention must be explained and detailed in full at the start of the written Defence. The Oman Courts usually reject a procedural argument if it is not raised at the commencement of the case.
Similarly, it is also important to raise substantive defences at the outset of the litigation. If the written Defence does not include substantive (i.e non-procedural) lines of defence, in addition to procedural defences, then there is a risk to the Defendant. Namely, the Oman Courts may reserve the matter for judgment, reject the procedural argument(s) and then state that the defendant has accepted liability for the substantive claim against it by refusing to file any substantive lines of defence.
Accordingly, we habitually advise that a written Defence should always start with procedural defences, and should also include substantive defences as well.
Thursday, April 21, 2011
Procedures of the Omani Courts
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People often ask me about the various stages of an Omani court case.
They usually begin with a statement of claim filed at the Primary Court.
The Claimant grants a power of attorney in favour of their lawyer so that the latter can file the case.
The power of attorney needs to be signed in front of a Ministry of Justice notary.
The Court staff usually want to see - on the statement of claim - the exact physical location details of the defendant's premises.
It therefore makes sense to always obtain the full physical location details of the parties with whom you contract, including your employees, right at the start of a relationship.
The court serves the statement of claim on the defendant and also sets a date for the first hearing.
It is quite common for the defendant's lawyer to attend the first hearing and request an adjournment. The Courts normally grant such an adjournment, especially if the defendant hasn't at that point provided a power of attorney to its lawyer.
When, later, the defendant's defence is filed, it is important that the document should include any procedural defences. For instance, the defendant may allege that the claim is time-barred or that the Courts lack jurisdiction owing to an arbitration clause in the contract. These procedural arguments must always be raised by the defendant in the first court submission lodged on its behalf (ie, in the Defence).
The Primary Court usually orders the Claimant to file a written reply in response to the defendant's Defence.
Soon after that, the Primary Court takes a view on whether or not to appoint an expert to assess the case.
The expert is normally working in the private sector and receives a mission letter from the court telling him the scope of work to be performed.
The expert will normally then hold separate meetings with the claimant and defendant, who can also bring their lawyers to such meetings.
Some experts ask many questions and others prefer to hear a verbal explanation of the litigant party's position.
My view is that lawyers should always be involved in helping their clients prepare for meetings with experts. I also firmly believe that the lawyers should be present at all times when discussions are being held by the expert with each litigant party. This strategy best protects the client and also ensures that they have meaningful back-up when the expert talks about any legal issues.
Also, the lawyer should be working hard on the client's behalf and should help in collating all necessary documents so that the entire scenario is explained in full and accurately to the expert.
The lawyer should also be ensuring that the client will be able to answer any and all questions which the expert may pose.
The lawyer's role, in part, is therefore to help the client explain their position eloquently to the expert, with proper documentary evidence which leaves the expert feeling that all his concerns and questions have been answered.
It is all too easy for an expert to reject an argument if the required paperwork is not provided.
Ultimately, the expert files his report at court, with the claimant and defendant receiving copies.
The Primary Court normally affords each litigant party the right to file a submission, commenting on the expert's report.
The Primary Court, having seen those submissions, may order the expert to provide an additional report, which should address all the concerns about the first report which have been raised.
Sometimes, the Primary Court agrees to appoint another expert if one party is unhappy with the first expert.
But usually the Primary Court reaches its own judgment decision after one expert has filed two reports.
It is not a fait accompli that the Court will agree with the expert whom they have appointed.
It is the lawyer's job to continue to file robust, convincing and persuasive submissions even if the expert's findings are in favour of the other party. This is especially true as the Court may agree that the expert is wrong.
Once a Primary Court judgment is pronounced orally at a hearing, each party has 30 days in which to file an appeal.
During those 30 days, the lawyer can first peruse the court file to see the draft Primary Court judgment and, after that, the written Primary Court judgment will become available.
Any appeal filed with the Appeal Court should document any and all alleged defects in the Primary Court's analysis and the expert's reasoning.
The Appeal Court has the right to appoint one or more additional experts to investigate the issues in dispute.
Once the Appeal Court orally pronounces its judgment at a hearing, each party has 40 days to file an appeal to Oman's third and final tier of justice, the Supreme Court.
It is very rare to have any hearings in the Supreme Court. This is partly because the Supreme Court looks at matters of law only, and is not designed to look at evidential issues.
The Supreme Court, once it has its judgment ready, normally calls both parties to court to hear their judgment. A Supreme Court judgment cannot be appealed.
Sometimes the Supreme Court refers the case back to a different panel of the Appeal Court. In such scenarios, the Supreme Court instructs the Appeal Court to look at the matter again in the context of the Supreme Court's instructions.
So, it is possible for a case to be the subject of two Supreme Court judgments - but the Supreme Court will only once refer the case backwards to the Appeal Court.
This article has hopefully given you a brief but helpful "helicopter view" of the Omani court system.
At times, litigation can be frenetic and it is always best to obtain legal advice long before a dispute arises. In this way, many court cases could be avoided.
Friday, January 7, 2011
Litigation Practice Notes: Costs Borne by Losing Party
One of the hallmarks of Omani court cases is that it is very unlikely that the losing party will be ordered to bear the winning party’s legal costs. Even when the Courts do order the losing party to pay some of the winning party’s legal costs, the amount that the Court imposes is normally de minimis, at approximately the level of RO 100 (approx. US$250). To the best of our knowledge, the highest sum ever ordered by the Omani courts to be borne by the losing party in respect of the winning party’s legal fees was RO 1,000 (approx. US$2,500) – and that was in a case where the winner’s legal fees actually exceeded RO 20,000 (approx. US$50,000).
However, there is a silver lining for winning parties when it comes to litigation costs: the Courts normally order the losing party to bear the entire costs of any Court-appointed expert(s).
Monday, November 22, 2010
Experts in Litigation
An issue that often arises in Omani litigation is the importance of experts.
Unlike in many other countries, the courts in Oman only recognise one expert - the expert appointed by the court. Therefore, the crux of many Omani cases is proving one's viewpoint to the satisfaction of the court-appointed expert.
That is not to say that the Omani courts always agree with their appointed expert. There are occasions where the courts totally override what the expert has concluded. Such a situation normally only happens where the courts decide that a provision of law is the reason why they wish to negate the expert's findings.
The court-appointed expert often will base his report on his oral discussions in meeting separately with each of the litigants. The litigants are each free to bring along to these meetings their legal advisors and any other technical third-party personnel.
In other words, if a litigant has a supportive report from a third-party expert, it is not enough to merely exhibit that document. The litigant should ensure that the writer of that report – i.e., the litigant’s own third-party expert – comes to the meetings with the court-appointed expert.
As a practical matter, the Omani courts place very little weight on the reports prepared by the litigants’ third-party experts. The courts want to hear what their own appointed expert has decided having read the relevant papers and having met with the litigants and with any individuals which the litigants bring to such meetings.
A final but important consideration: often the court-appointed experts wish to converse only in Arabic. This is a factor which should always be borne in mind, especially in choosing a litigant’s expert.
Saturday, October 30, 2010
Importance of Specifying Counter-Party Physical Address
Focus on Litigation
Much of the disputes process is centered on the usual elements of litigation: cogent legal arguments, meticulous gathering of evidence, and navigation of complex procedural requirements. Yet even after many years of practicing law in Oman, we are often reminded of how the actual day-to-day progress of a matter can turn on the most mundane of details – for example, ascertaining the physical addresses of the parties.With the great urgency often surrounding the litigation process, such as filing a case or an injunction application with the Omani Courts, one small detail that sometimes gets lost in the shuffle – namely, omission of the actual physical addresses of the parties to the dispute – can inject considerable delay into the overall process.
The Omani Courts now require very exact information about the physical address of each party to a case. (If the party is a company with multiple physical addresses, the physical address of the company’s head office must be specified; if the party is an individual with multiple residences, the physical address of the individual’s primary residence must be specified.) A high level of detail is often required. It is, perhaps strangely, not enough to state that company X’s head office is in building Y. The Courts require us to state the exact floor of the building, the building number, and the way/street number, together with any nearby landmarks. If these details are not provided, the court will not allow the case to move forward.
Accordingly, it is very important for parties to know the exact physical address details of the entities in Oman with whom they do business. When doing transactions, one often knows only the other party’s postal address (typically a P.O. box). In Omani litigation, however, it is the physical address information which is of paramount importance. Whilst we can often help in finding out a physical address, it is prudent for companies to ascertain such information right at the beginning of their commercial relationship with a counter-party.
Monday, September 27, 2010
Focus on Litigation: Settlement Agreements
When a dispute seems to have been resolved by a verbal agreement, many could be forgiven for thinking that a lawyer’s role is no longer necessary. After all, the only thing still required at that point is a written record, signed by both parties, as regards the terms on which the dispute has been settled. It sounds easy.
However, properly putting a verbal agreement into writing is not always easy. A fully protective settlement agreement requires a great deal of legal precision. Some immediate questions arise, for example:
Many settlement agreements do not spell out with requisite precision who will do what, and when. Equally, they may contain terms that are not defined, or which are defined too loosely, thereby leaving these terms – such as “handover date”, “payment issues” or “additional resources” – open to interpretation.
An imprecise settlement agreement may turn out not to be a true settlement at all. The only way a settlement agreement genuinely can signal the conclusion of a dispute is when it is drafted with the exactitude required. This can prevent the perceived ending of one dispute from becoming the start of another dispute.
Monday, March 22, 2010
Prescription under Omani Law
For persons debating whether to bring a claim under Omani law, it is important to know that, for some matters, Courts will not permit the claim if too much time has elapsed since the event giving rise to the claim occurred. Similarly, companies that are concerned about potential litigation over an event may wonder at what point they can finally lay the matter to rest and be certain that no litigation will ensue.
The legal concept dealing with when a claim must be brought is known as “prescription” in civil law jurisdictions such as Oman. Prescription sets forth a maximum period of time after an offense occurs within which legal proceedings may be initiated. If the claim is not brought within the prescription period, the Court is unlikely to accept the case regardless of how strong it may be. This concept also is recognized in common law jurisdictions such as England and the United States under the term “statute of limitations”.
Prescription periods vary from case to case based on several factors such as the severity of the alleged offence. For example, in severe criminal matters there often is no prescription period and a person may be prosecuted no matter how much time has elapsed since the crime occurred. In contrast, for simple commercial matters the prescription period may be much shorter. In a commercial context, short prescription periods encourage parties to raise complaints in a timely fashion, which promotes certainty in commercial dealings.
Some typical examples of prescription in Omani law include:
Monday, July 6, 2009
Focus on: Litigation in Oman
Summer time is when the Oman Courts almost go into hibernation; very few hearings take place between July 1 and September 30.
However, in many ways it is the most crucial time in Omani litigation, because the Court-appointed experts are often writing their reports to the Courts over these three months.
It is probably true to say that, about 90% of the time, the Omani Courts rubber-stamp and approve the report conclusions reached by the experts who have been appointed by those Courts.
The Courts in Oman choose to appoint experts in most cases, and they frequently turn to local private-sector accountants when monetary compensation is claimed.
In these cases, it is not the Oman Courts that must be persuaded - rather, one must convince the experts appointed by the Courts. Experts meet with the parties separately to hear arguments and receive documents. These meetings are central to determining who wins and loses in Oman Court cases.
Lawyers play an important part in assisting and guiding their clients in meetings with experts. Good preparation is a prerequisite, as is an ability to answer all the enquiries made by the experts in these face-to-face scenarios.
The general rule in Omani law is that an aggrieved party will be compensated for its direct losses, as opposed to indirect losses.
However, there is no clear-cut Omani judicial definition of “direct“ and “indirect“, and it should be borne in mind that most of the experts do not have qualifications in law in any event. Accordingly, it is the lawyers who need to convince the experts whether a specific head of claim should be perceived as direct or indirect.
It should also be remembered that Omani law includes a duty to mitigate one’s losses and, equally, Egyptian case law is highly persuasive to experts and the Courts in Oman.
