SBM Bank (Mauritius) Ltd v (1) Renish Petrochem FZE (2) Mr Hiteshkumar Chinubhai Mehta [2024] DIFC CA 011 (25 May 2024)

SBM Bank (Mauritius) Ltd v (1) Renish Petrochem FZE (2) Mr Hiteshkumar Chinubhai Mehta [2024] DIFC CA 011 (25 May 2024)

The trial judge correctly applied the civil standard of proof for fraud, and the inference of fraud was more probable than any innocent explanation based on the rapid dissipation of funds following the fifth and sixth advances. Implied representations were made by presenting documents to induce advances, and the payments representations constituted actionable fraud. The costs order at trial was erroneous given the finding of fraud and was set aside.

Citation
[2024] DIFC CA 011
Parties
Respondent/claimant: SBM Bank (Mauritius) Ltd; Appellant/defendant: Renish Petrochem FZE; Appellant/defendant: Mr Hiteshkumar Chinubhai Mehta
Jurisdiction
United Arab Emirates
Judgment Date
25 May 2024
Procedural Posture
Appeal / Judgment
Outcome
Appeal dismissed; cross-appeal on fourth advance dismissed; cross-appeal on costs allowed.
Legal Topics
Fraudulent Misrepresentation, Trade Finance, Implied Representations, Standard of Proof in Civil Fraud, Costs Orders
Commercial Law Fraud Banking Law Fraudulent Misrepresentation Trade Finance Implied Representations Standard of Proof in Civil Fraud Costs Orders

Case Brief

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Parties

SBM Bank (Mauritius) Ltd

Respondent/claimant

Renish Petrochem FZE

Appellant/defendant

Mr Hiteshkumar Chinubhai Mehta

Appellant/defendant

Procedural Posture

Appeal / Judgment

Legal Issues

  1. 1 Whether the trial judge applied the correct legal test for civil fraud
  2. 2 Whether actionable implied misrepresentations were made
  3. 3 Whether the payments representations constituted fraud

Ratio Decidendi

The trial judge correctly applied the civil standard of proof for fraud, and the inference of fraud was more probable than any innocent explanation based on the rapid dissipation of funds following the fifth and sixth advances. Implied representations were made by presenting documents to induce advances, and the payments representations constituted actionable fraud. The costs order at trial was erroneous given the finding of fraud and was set aside.

Court Disposition

Appeal dismissed; cross-appeal on fourth advance dismissed; cross-appeal on costs allowed.

Orders

  • Appellants’ appeal dismissed.
  • Permission granted to Respondent to cross-appeal on fourth advance.