The Saudi Board of Grievances

The Saudi Board of Grievances (the “Grievance Board”), known in Arabic as Diwan Al Mazalem, was established pursuant to Royal Decree No. M/51, 17 Rajab 1402 [10 May 1982] (the “1982 Decree”) as an independent administrative judicial committee responsible directly to the King of Saudi Arabia. From its creation, the Grievances Board was an enormous success, being both professional and efficient. Originally it only had jurisdiction over claims against the Saudi government but over the years it has inherited substantially broader jurisdiction and dealt with most types of commercial disputes.

Reforms

Since 2000, Saudi Arabia has embarked on a legislative reform programme and hence the 1982 Decree was abolished and superseded by Royal Decree No. M/78 dated 19/9/1428 H [1 October 2007] (the “Royal Decree 2007”). Amongst other things, the Royal Decree 2007 restructured the Grievance Board, returning it to its roots as an administrative tribunal, with jurisdiction over commercial disputes to be transferred to a new Commercial Division of the General Islamic Court. While to date very little has changed, in practice as the infrastructure necessary to implement this restricting is not yet in place, it is worth noting that the restricting should eventually occur.

Structure

The courts of the Grievance Board consist of the following:

• the High Administrative Court, which is the highest court of the Grievance Board and has powers equivalent to those of a Cassation Court;
• the Administrative Courts of Appeal; and
• the Administrative Courts, which is the lowest court and has powers equivalent to those of a First Instance Court.

As in traditional courts, the decisions of the highest court bind the lower courts.

The Grievance Board itself consists of a president of the rank of a minister, one or more vice-presidents and a sufficient number of judges, in addition to the necessary number of researchers, specialists, administrators and the like.

Jurisdiction

Under Article 13 of the Royal Decree 2007, Administrative Courts of the Grievance Board have the jurisdiction to decide:

• disputes involving the Saudi Arabian government and government agencies;
• cases for revocation of final administrative decisions;
• tort cases initiated against the administrative authority’s decisions or actions;
• cases related to contracts to which the administrative authority is party;
• disciplinary cases filed by the competent authority;
• other administrative disputes;
• requests for execution of foreign judgments and arbitral awards.

Main procedural features

In late 2013, a new Procedural Law of the Grievances Board was issued (the “Procedural Law”). Article 1 of this law emphasises that the Courts of the Grievance Board apply Islamic shariah law to disputes before them and are bound by the provisions of the Procedural Law.

The process for bringing a case before the Administrative Courts of the Grievance Board is as follows:

• There are no pre-trial procedures, nor is there any statutory or shariah law time limit for bringing commercial claims (though the parties can contractually agree to set time limits).
• The claimant files a complaint and supporting documents, all in Arabic.
• The court prepares a summons and serves it together with the claim documents on the defendant (as well as to the Ministry of Finance and Ministry of Financial Audit).
• Preliminary issues such as applications regarding the court’s jurisdiction will be decided at the first hearing.
• A series of short hearings take place where parties file written submissions, oral argument is heard and evidence is produced.
• Judgments are issued by a majority in writing. If there is a dissenting opinion, then this opinion must be recorded in the deliberation reports. These reports are confidential and can only be seen by the court considering the judgment appeal.
• Judgments of the Administrative Court can be appealed before the Administrative Court of Appeal within 30 days of the issuance of the judgment (or receipt thereof). If no appeal was made the judgment becomes final, binding and enforceable.

Disclosure and evidence

Disclosure of evidence is based on shariah law principles which provide that each party should adduce the evidence upon which it relies and which is relevant to the case (even if unfavourable). There is no legal obligation on a party to preserve evidence for litigation purposes.

Saudi courts typically appoint experts to assist with technical or specialist issues. Party appointed experts do not feature in Saudi court proceedings.

Remedies and costs

The most common remedy available is monetary damages. Generally, injunctions are not available. However, attachment orders (similar to a freezing injunction) to preserve the defendant’s asset while the proceedings are ongoing are available.
The court has discretion to award costs to the successful party but generally does not do so unless the claim is deemed vexatious. A successful claimant may recover its legal costs, travel expenses and any expert fees.

By Nicholas Gould
Fenwick Elliott

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