Kuwait Court of Cassation principle number 319

Summary: - Capital markets. Establishment of a specialized judicial body through which the easy and straightforward resolution of disputes arising in connection with the application of the provisions of this Law is achieved; the Law took care to repeal any provision conflicting with its provisions. Reason for this. Articles 108 and 116 of Law 7 of 2010 concerning the Establishment of the Capital Market Authority and the Regulation of Securities. - Capital Markets Court. Criterion for its jurisdiction. The dispute must arise from the application of the provisions of Law 7 of 2010 concerning the Establishment of the Capital Markets Authority and the Regulation of Securities, and the rules and regulations governing the securities market, and enforcement disputes relating to judgments issued by it; its provisions override the provisions of any other law. Example concerning a dispute falling outside the jurisdiction of the non-criminal circuit of the Capital Markets Court. Rule: The provision in Article 108 of Law No. 7 of 2010 concerning the Establishment of the Capital Markets Authority and the Regulation of Securities that: “A court called the ‘Capital Markets Court’ shall be established at the Court of First Instance. Its seat shall be designated by a decision of the Minister of Justice with the approval of the Supreme Judicial Council. This court shall consist of the following: 1- ... 2- Non-criminal circuits having exclusive jurisdiction to adjudicate non-criminal actions relating to commercial, civil and administrative disputes arising from the application of the provisions of this Law and the rules and regulations governing the securities market, and substantive enforcement disputes relating to judgments issued by it, irrespective of the value of such disputes,” and in Article 116 that: “The non-criminal circuits of the Court of First Instance shall, of their own motion, refer the actions pending before them which have come within the jurisdiction of the Capital Market Court pursuant to the provisions of this Law to the latter court in their existing state,” indicate, in accordance with what is stated in the Explanatory Memorandum to the Law, that a judicial body specialized in capital market activity was established to achieve the easy and straightforward resolution of disputes arising in connection with the application of the provisions of this Law, which took care to repeal any provision conflicting with its provisions, whatever the subject matter of that provision, in recognition of the fact that its provisions are those of a special law concerning capital markets which, in its application, overrides any other law, whether special or general; and that the criterion for the jurisdiction of the Capital Market Court is that the dispute arise from the application of the provisions of Law No. 7 of 2010 concerning the Establishment of the Capital Markets Authority and the Regulation of Securities, the rules and regulations governing the securities market, and substantive enforcement disputes relating to judgments issued by it. That being so, the first respondent brought his incidental action seeking an order requiring the appellants, on a concurrent-liability basis, to pay Al-Hadi Real Estate Company (in liquidation) the sum of 8328902.866 dinars, representing the indebtedness owed by them as a result of the third respondent bank liquidating the investment portfolio owned by the company to discharge the second appellant’s debt secured by a pledge of that portfolio. The appellants also brought their incidental action seeking the appointment of an expert to identify the person who established the investment portfolios registered in the name of Al-Hadi Real Estate Company (in liquidation), their true owner, the loans obtained in the company’s name, the person who obtained them and the person repaying them, whether they were repaid from his private account or from the company’s account, and the value of what remained unpaid, and to settle the account between the parties in order to establish the difference due to them from the company, in preparation for a judgment declaring their entitlement to recourse against the company’s liquidator for these amounts. These actions, being of that nature, are not commercial disputes arising from the application of the provisions of the aforementioned Law No. 7 of 2010 concerning the Establishment of the Capital Markets Authority and the Regulation of Securities and the rules and regulations governing the securities market. They therefore do not fall within the jurisdiction of the aforementioned non-criminal circuit of the Capital Markets Court. Since the first-instance judgment, upheld by the challenged judgment, adhered to this view and adjudicated the merits of the dispute, it did not contravene the law or err in its application, and the ground of challenge is without basis.