Dubai court orders company to pay Dhs1.083m to supplier in delayed payment

Dubai Commercial Court ordered a company to pay a supplier Dhs1.083 million, this being the value of goods that the latter supplied and delivered under 11 tax invoices with legal interest of 5 per cent annually from the due date of each invoice until full payment.

The court, however, rejected a request for additional compensation of Dhs200,000 due to the lack of proof of harm.

Earlier, a supplier filed a lawsuit in which he requested the court to obligate the company to pay him his financial dues against commercial transactions he had conducted on behalf of a company.

The company issued purchase orders, based on which the plaintiff supplied the goods and issued tax invoices and delivery and receipt notices, but the company did not pay the value of the supplies despite repeated demands.

The report of the appointed expert committee proved that the two parties had a commercial relationship and that the plaintiff had fully fulfilled its obligations to supply the goods under 11 tax invoices totaling Dhs1.083 million including VAT. It was also proven that the defendant or its representative received the goods and no reservations or objections to them were registered.

The report also concluded that there were no documents proving payment for the goods or a settlement regarding them and consequently, the defendant was liable for the full amount and obligated to pay the value of the supplies.

The contract is the law of the contracting parties and the obligations arising from supply contracts require the supplier to deliver the goods in accordance with the agreement and the buyer to pay their value, the court said, noting that failure to pay the price entailed the debtor’s liability for the amount due.

Meanwhile, the court rejected the supplier’s request to get Dhs200,000 compensation as he did not provide anything proving the nature of the harm he had befallen and the papers submitted did not include documents or technical and accounting data that would enable the claimed damage to be estimated.

The court ordered the two parties to pay the incurred expenses and lawyer’s fees and dismissed all other requests.