Peter Matthew James Gray v Gibson Dunn and Crutcher LLP [2016] DIFC CA 012

March 12, 2017 Court of Appeal - Judgments,Judgments

Claim No: CA-012-2016

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

Court

In the name of His Highness Sheikh Mohammad Bin Rashid Al Maktoum, Ruler

Ruler

of Dubai

IN THE COURT

Court

OF APPEAL

BEFORE THE CHIEF JUSTICE

Chief Justice

MICHAEL HWANG, JUSTICE SIR JEREMY COOKE AND H.E. JUSTICE ALI AL MADHANI

BETWEEN

PETER MATTHEW JAMES GRAY

Claimant

Claimant

/ Appellant

and

GIBSON DUNN AND CRUTCHER LLP

Defendant

Defendant

/ Respondent

Hearing: 14 December 2016

Counsel: Patrick Hennessey and Julian Critchlow instructed by Al Bawardi Critchlow for the Appellant

Graham Lovett and Ryan Whelan (Gibson Dunn & Crutcher LLP) for the Respondent

Judgment: 12 March 2017

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JUDGMENT

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Summary of Judgment

This is an appeal on a short point of law against the first instance judgment of H.E. Justice Shamlan Al Sawalehi relating to the terms of the DIFC DIFC Arbitration Law (as amended). The first instance decision is the first decision on this point which involves the inter-relationship between Article 7 and Articles 12 and 13 of the DIFC Arbitration Law (as amended). A critical issue is the location of the seat of the arbitration for which the contract of employment between the Appellant and the Respondent provided. The Appellant had pursued claims against Gibson Dunn for various declarations, indemnities and monetary compensation arising out of the termination of his employment by Gibson Dunn.  The latter maintains that his employment was terminated with cause, for misconduct, whereas he asserts that he was wrongly dismissed. It was common ground between the parties that the claims made were, in part, governed by the DIFC Employment Law because it provided that the applicable law to a contract of employment of an employee based within, or who ordinarily worked within or from the DIFC, should be that law (Article 4(2)).  Other parts of the claim were however governed by the law the Law of California. There was no express provision in the Letter Agreement as to the seat of the arbitration.  The result was that it cannot be said that the seat of the arbitration is DIFC.  It could be argued that the seat is California by implication from the terms of the arbitration clause or alternatively that the seat remains undesignated until such time as venue is agreed or, in default, California becomes the venue.  As the first instance Judge Judge held, however, it could not be the DIFC. The Court Court of Appeal held that the first instance Judge was clearly right in holding that Article 13 of the DIFC Arbitration Law (as amended) (which provides for a mandatory stay on application by a party to an arbitration agreement) applied in the circumstances because the seat of arbitration had not been designated or determined or if, in fact, the seat of arbitration was one other than the DIFC. Furthermore, he also found that the Appellant had accepted the terms of the arbitration agreement by following the first and second steps for negotiation and mediation and then stating a willingness to arbitrate when filing his initial SCT action seeking a declaration that the arbitration agreement was valid and asking Gibson Dunn to agree on a particular venue for the arbitration. Gibson Dunn had made no application under Article 12(2)(iii) of the