Dentons faces $3.5m professional negligence claim in DIFC courts
SNR Denton legacy firm Denton Wilde Sapte is being sued by a former client for around $3.5m in the Dubai International Financial Centre (DIFC) courts.
Injazat Technology Fund (ITF), a subsidiary of G Capital Limited (formerly Injazat Capital Limited), has instructed Dewey & LeBoeuf Dubai partner Peter Gray to sue Denton Wilde Sapte for professional negligence. SNR Denton has instructed Simmons & Simmons partner Miles Alexander to defend the claim.
The facts of the case hark back to 2006 when ITF made a $3m investment in Broadlink Research. When Broadlink became insolvent in 2007, ITF instructed Dentons’ UAE office to advise it “how best to protect its position in relation to the investment, including the merits of bringing a claim against Broadlink and/or the guarantors”.
Dentons’ lawyer on the case, associate Matthew Blycha, who is no longer at the firm, reviewed the contract between ITF and Broadlink and advised ITF to go into arbitration at the International Chamber of Commerce. ITF won the arbitration under advice from Dewey & LeBoeuf, but the company claims that Blycha’s advice was negligent as he failed to mention a clause in the contract, which subsequently expired, that would have allowed ITF to recoup its investment from Broadlink, as well as a 25 per cent uplift, without the need to go into arbitration.
A source close to the claimant said that the company alleges that a high turnover of Dentons lawyers working on the case were to blame for the alleged slip-up.
ITF is now suing Dentons for $2m in relation to the amount paid to Broadlink, $500,000 for the 25 per cent premium it would also have recovered under the expired clause, and more than $850,000 in relation to the allegedly unnecessary arbitration costs. The company is also claiming damages for time spent in connection with the arbitration as well as in investigating Dentons’ alleged negligence.
SNR Denton is now arguing that the matter should be heard by the Dubai courts, where negligence claims require an intention to defraud, as opposed to the DIFC courts, which operate under international laws. A jurisdictional hearing has been scheduled in the DIFC courts.
Injazat has instructed Fountain Court’s David Murray as counsel. It is not yet known who SNR Denton has instructed as counsel.
Dewey & LeBoeuf declined to comment.
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Readers' comments (12)
Barry Wood | 27-Oct-2011 5:15 pm
Christmas to be cancelled ?
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Anonymous | 27-Oct-2011 8:56 pm
That story merits a headline and potentially destroying that associate's reputation over an as yet unproven allegation? Is The Lawyer now bringing a bit of tabloid lack of discretion and taste to the world of legal news?
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Anonymous | 28-Oct-2011 10:23 am
I completely agree with Anonylus @ 8.56am above...the individual in question wasn't even a partner at the time.
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Anonymous | 28-Oct-2011 11:06 am
Agreed. Just how exactly does naming the associate involved (who, as the above poster pointed out, is likely to have been supervised in some capacity on this) add to the story? Pretty shameful stuff.
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Asim Al Raisi | 28-Oct-2011 12:06 pm
I agree with the above that the associates name should be removed.
That said It is good to see when large law firms are bought to account for thier mistakes.
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Anonymous | 28-Oct-2011 12:51 pm
If the associate was named in the claim form then why wouldn't The Lawyer publish his name? One might even suggest it has a duty to report his name as being in the public interest. Lawyers might find it hard to believe, but reporting has to be objective to serve the purposes of everyone.
This is law in the Middle East, if you can't take the heat stand away from the fire.
Why all the fuss - national press name criminal suspects all the time without being held to account.
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Anonymous | 28-Oct-2011 12:57 pm
It would seem from a quick search of the Law Society's website that the named assciate qualified in 2009 and so was actually a trainee at the time. Could someone at TheLawyer.com look into this urgently and remove the poor man's name from the article f this is true. There must be a partner who supervised this matter who can be named if necessary.
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Anonymous | 28-Oct-2011 1:01 pm
Anonymous 28/10/11 @ 12:51:
If "reporting has to be objective to serve the purposes of everyone" (which must be correct as a statement of general principle) then the report ought to say whether the associate was supervised in carrying out work for this client.
That nothing is said about this raises the suspicion (but no more than that) that this obvious - and important - fact may have been overlooked in the reporting of this story (or any briefing on the claim now brought, by whichever side).
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Anon | 28-Oct-2011 1:21 pm
Just because someone qualified as an English solicitor in 2009 does not necessarily mean they were a trainee immediately prior to that. They could, for example, have been a lawyer originally qualified in another jurisdiction and practising for a number of years before taking the QLTT....
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Anonymous | 28-Oct-2011 1:33 pm
I live in Dubai and heard about the case. I believe the partner in charge was MIchael Kerr. Its been in the press in Dubai and you can see it on the DIFC courts website
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