Ontario Court of Appeal upholds recognition of Dubai arbitration award for over US$2.5M

The Ontario Court of Appeal has affirmed the Ontario Superior Court’s judgment recognizing an arbitral award issued in the Dubai International Financial Centre (DIFC) as binding and enforceable in Ontario under the province’s International Commercial Arbitration Act, 2017. 

The appellant in this case was an Afghan citizen, an Ontarian resident, and the founder of a university and multiple schools in Afghanistan. The respondent was a UK-based private equity firm. 

InFrontier AF LP v. Rahmani, 2026 ONCA 289, provided the backdrop for a term loan agreement between the parties. 

The DIFC Arbitration Institute and the London Court of International Arbitration (LCIA) had a partnership that enacted the Rules of Arbitration of the DIFC-LCIA Arbitration Centre (DIFC-LCIA Rules). Under these rules: 

• An agreement to arbitrate would amount to an agreement to any amended version of the rules adopted before the commencement of an arbitration 
• An arbitrator appointed under the DIFC-LCIA Rules would conduct arbitration in the DIFC – a common law jurisdiction in Dubai, United Arab Emirates – to resolve disputes under the rules 

In September 2020, the parties entered into an agreement under which the respondent granted a loan to two of the appellant’s schools. The appellant guaranteed repayment of the loan. 

In September 2021, the Dubai government enacted Decree 34, which abolished the DIFC Arbitration Institute and transferred its rights and obligations to the Dubai International Arbitration Centre (DIAC). The decree maintained the existing arbitration rules until the approval of the DIAC’s new arbitration rules. 

On Mar. 21, 2022, DIAC’s board of directors approved its own arbitration rules (DIAC Rules), which would apply regardless of the underlying agreement’s date, unless the parties agreed otherwise. 

On Mar. 29, 2022, DIAC and LCIA issued a press release stating that DIAC would administer all arbitrations started after Mar. 21, 2022, under agreements referring to the DIFC-LCIA Rules, unless the parties agreed otherwise. 

In 2023, the respondent brought arbitration proceedings asserting that the schools defaulted on the loan in December 2022. Though the appellant objected, an arbitrator conducted the arbitration under the DIAC Rules in the DIFC. 

Rejecting the defences claimed, the arbitral award required the appellant and the schools to pay the respondent US$2.5 million for the outstanding principal under the agreement, plus interest, penalties, and costs. The arbitrator, appointed under the DIAC Rules, also issued rulings regarding deadlines and extensions of time. 

The appellant alleged that the rulings under the DIAC Rules compressed the proceedings and left inadequate time for legal counsel to properly represent him and the schools. 

Before the Ontario Superior Court of Justice, the respondent applied for an order recognizing and enforcing the award in the province. 

On July 3, 2025, Justice Peter Cavanagh of the Superior Court recognized the arbitral award and ordered the appellant to pay the amounts owed to the respondent under the award. Upon interpreting the parties’ 2020 agreement, the application judge determined that their agreed-upon rules were identical to those the arbitrator used. 

The appeal raised the issues of whether the application judge erred in: 

• his approach to art. V 1(d) of the United Nations Conference on International Commercial Arbitration in New York on June 10, 1958 (Convention) by considering Dubai law, specifically Decree 34 
• his recognition and enforcement of an award under an unfair procedure to which the parties did not consent, in breach of Ontario public policy and arts. V 1(b) and V 2(b) of the Convention 

No Convention breaches found

The Court of Appeal for Ontario dismissed the appeal.

The appeal court held that the application judge did not violate the Convention by allowing the law of the place of arbitration to oust or override the parties’ agreement regarding the applicable procedural rules. 

Instead, the appeal court explained that the judge: 

• correctly identified the key issue as the interpretation of the 2020 agreement 
• interpreted the agreement to determine their agreed-upon procedure 
• noted that the agreement specified that the DIFC-LCIA Rules would govern 
• found that the parties agreed to the procedural rules in force at the time of agreement or an amended version adopted by the beginning of their arbitration 

The appeal court saw no extricable legal error or reversible error in the judge’s interpretation of the agreement, his finding regarding the amended version of the rules, or his determination that the appellant failed to prove any Convention ground to deny recognition and enforcement. 

Regarding the art. V 1(d) issue, the appeal court noted that the judge: 

• interpreted the entire agreement, including referentially incorporated terms 
• considered Dubai law, specifically Decree 34, which abolished half of the partnership that enacted the relevant rules, thus impacting the issues of whether there was an amendment to the rules and what the amended version was 
• referred to the press release, through which DIAC and LCIA shared that the DIAC Rules would govern future arbitrations 

The appeal court held that the judge reasonably interpreted the phrase “unless the parties agreed otherwise” to refer to agreements executed after the DIAC Rules became the amended version of the DIFC-LCIA Rules. 

The appeal court added that the appellant failed to establish that either the arbitral authority’s composition or the arbitral procedure went against his agreement with the respondent. 

Lastly, the appeal court described the appellant’s argument about arts. V 1(b) and V 2(b) as derivative of the issue regarding art. V 1(d). The appeal court concluded that this argument failed for the same reasons.