The Ontario Superior Court of Justice has granted recognition and enforcement of a Dubai-seated arbitral award in InFrontier AF LP v. Rahmani, 2025 ONSC 3968, confirming Ontario’s commitment to the New York Convention and providing valuable clarity on the impact of institutional changes on arbitration agreements.
In this case, InFrontier AF LP, a UK-based private equity firm, applied to recognize and enforce a DIAC arbitral award issued against Roeen Rahmani, a Canadian resident and guarantor of loans extended to Afghan schools. The award, rendered in August 2024, found Mr. Rahmani liable under a 2020 loan agreement for more than US$2.8 million in principal, interest, penalties and costs.
Mr. Rahmani opposed the application on three main grounds:
- That the arbitration was conducted under the wrong set of rules,
- That the process was unfair and denied him the opportunity to present his case, and
- That enforcement would offend Ontario public policy.
The Court rejected all three arguments.
The Court’s analysis of the local law’s impact on the arbitration agreement
The Court found that the seat of the arbitration was the DIFC, which is a common law jurisdiction within the United Arab Emirates (UAE) with its own distinct legal system and procedural rules.
In September 2021, a significant local law impacting the arbitration agreement, Dubai Decree No. (34) Concerning the Dubai International Arbitration Centre (the “Decree”), was issued. The Decree abolished the DIFC Arbitration Institute and transferred all its rights and obligations to the Dubai International Arbitration Centre (DIAC).
According to InFrontier, the Decree affirmed existing arbitration agreements but replaced the DIFC-LCIA Arbitration Rules with the DIAC Arbitration Rules for any new arbitrations commenced after March 21, 2022, unless the parties agreed otherwise. Mr. Rahmani argued that the Decree only altered the institution that would administer arbitrations, not the procedural rules the parties had chosen (DIFC-LCIA Arbitration Rules). However, the loan agreement did not specify an arbitration institution.
The Court found that the Preamble to the original DIFC-LCIA Arbitration Rules stated that parties are taken to have agreed to conduct arbitration in accordance with “such amended version of those rules as the DIFC-LCIA Arbitration Centre may have adopted hereafter to take effect before the commencement of the arbitration.”
The Court concluded that, through Article (8)c of the Decree, the DIAC Arbitration Rules became an “amended version” of the DIFC-LCIA Arbitration Rules effective March 21, 2022. This meant that, by force of the Decree, the parties to the loan agreement were taken to have agreed that any arbitration between them would be conducted in accordance with the DIAC Arbitration Rules.
The Court emphasized that the parties were still free to agree on a different set of arbitration rules after the Decree, as provided for in the DIFC Arbitration Law and the DIAC Arbitration Rules, but they did not make such an agreement.
Therefore, the local law (the Decree) effectively transformed the agreed-upon arbitration rules without requiring a new, explicit agreement from the parties, based on the original agreement’s own provisions for amendments.
The Court also found no denial of procedural fairness. While Mr. Rahmani raised concerns about compressed timelines and difficulties securing legal representation, the Court held that the arbitrator had provided opportunities to make submissions, ruled on requests for procedural accommodations and properly applied relevance and materiality standards in disclosure rulings.
Ultimately, the Court affirmed the enforceability of the award under Ontario’s International Commercial Arbitration Act, adopting a purposive interpretation of Dubai’s Decree and reinforcing Ontario’s status as an arbitration-friendly jurisdiction.
The applicant’s team and strategic approach
InFrontier was represented by Michael D. Schafler and Ekin Cinar of Dentons Canada LLP. The team successfully guided the Court through a complex intersection of international law, evolving arbitral institutions, and domestic enforcement standards. This decision is a significant precedent on the adaptability of arbitration agreements in the face of institutional reforms and stands as a reminder that commercial parties must stay abreast of changes affecting their dispute resolution clauses.
For more information on this topic, please reach out to Michael D. Schafler and Ekin Cinar.
