Court rules company must settle outstanding supply invoices but rejects claims against manager and purchasing officer
Ajman: The Ajman Federal Court of First Instance has ordered a general trading company to pay Dh107,310 to a supplier for materials it received but failed to pay for, while rejecting a request to hold the company’s manager and purchasing officer personally liable for the debt.
The supplying company filed a lawsuit seeking to compel the defendant company, its manager and its purchasing officer to jointly pay Dh107,310, along with legal interest of 5% from the date of the claim until full payment, in addition to fees, expenses and legal costs.
The supplier stated that it had contracted with the defendant company to provide materials according to agreed specifications and conditions. The materials were received by the company, and delivery notes were signed and stamped to confirm receipt in good condition. However, the value of the supplies remained unpaid despite repeated demands for payment.
To support its claim, the supplier submitted copies of its commercial licence, invoices, delivery receipts bearing the defendant company’s seal, a statement of account detailing the invoices and amounts owed, and a referral decision from the Mediation and Conciliation Centres after settlement efforts failed.
During the proceedings, the purchasing officer’s lawyer argued that the lawsuit should not be accepted against his client on the grounds that he had no legal standing in the dispute.
In its judgment, the court explained that a supply contract obliges a merchant or manufacturer to provide goods or services on a recurring basis according to agreed specifications, quantities and delivery schedules in return for payment.
The court noted that established Federal Supreme Court principles recognise commercial records and modern electronic business records as valid evidence in commercial disputes. It also stated that accepted and signed invoices constitute evidence of the validity of their contents and of the debt owed, without the need for additional accounting documents.
Applying these principles, the court found that both parties were merchants engaged in a commercial transaction and that the supplier had submitted invoices addressed to the defendant company bearing its seal and confirmation of receipt.
The court concluded that the defendant company’s representative had received the materials specified in the invoices, including their quantity, type and value, making the company liable for payment.
It also noted that the statement of account submitted by the supplier bore the defendant company’s seal without any reservations, which the court considered an acknowledgement of the debt.
As a result, the court ordered the company to pay Dh107,310.
However, the court rejected the supplier’s request to hold the company manager and purchasing officer personally liable for the debt.
The judgment stated that, under the principles governing limited liability companies, partners’ liability is limited to their shares in the company’s capital and does not extend to their personal assets. It added that a company manager is not personally liable for company debts provided he has acted within the terms of the company’s articles of association and governing regulations.
The court found that the supplier had failed to provide any legal basis for holding either the manager or the purchasing officer personally responsible for the company’s obligations.
Regarding interest, the court ruled that the claimed amount was fixed and clearly determined, and that the company’s delay in payment entitled the supplier to compensation in the form of legal interest.
The court therefore ordered the defendant company to pay Dh107,310, together with legal interest of 5% from July 1, 2026 until full payment, as well as court fees, expenses and Dh500 in legal costs, while dismissing all other claims.
Source: Emirates 24|7