Dubai court upholds businessman’s acquittal, says unsettled accounts do not prove criminal breach of trust.
The Dubai Court of Appeal has upheld the acquittal of a businessman accused of criminal breach of trust in a case arising from a failed used-car spare-parts venture, reaffirming that business disputes do not automatically amount to criminal offences.
The case began when two individuals entered into a joint investment in a spare-parts business. After the partnership broke down, one party accused the other of improperly retaining funds that had been entrusted to him through a power of attorney, leading to criminal proceedings over alleged breach of trust.
To evaluate the allegations, the court examined witness statements, contractual documents, company records and an independent expert’s report.
The review showed that the matter was not a straightforward case of misappropriation, but rather a complex business dispute involving joint investments, shared management responsibilities and disagreements over financial accounts.
The court-appointed expert found no evidence in the financial records or company documents indicating dishonest misappropriation or unlawful use of funds. Instead, the records reflected a complicated partnership structure, with shared investments, withdrawals, profits, expenses and financial obligations between the two parties that had never been fully settled.
A key factor was that the partners had not prepared a final statement of accounts to establish who owed what. Without that reconciliation, the expert said it was impossible to determine whether the disputed funds represented personal misuse, unpaid business entitlements, outstanding expenses or ordinary profit-sharing arrangements.
As there was no clear evidence of deliberate diversion of funds or dishonest intent, the case did not meet the legal requirements for criminal breach of trust, which requires proof of fraudulent conversion and wilful misappropriation.
The court concluded that the matter was a commercial accounting dispute rather than a criminal offence, and that such disagreements should be addressed through civil proceedings where financial claims and obligations can be properly assessed.
The ruling serves as a reminder to entrepreneurs and investors, particularly those involved in sectors such as automotive trading, that failed ventures and unresolved accounts do not automatically justify criminal complaints.
Vishal Tinani, the legal adviser representing the acquitted businessman, said a breach of trust allegation requires more than simply retaining money.
“The evidence must show that the property was specifically entrusted to the accused under a recognised arrangement, that it was dishonestly misused, and that criminal intent existed at the time,” he said.
“When partners share investment, profits and management responsibilities, fraud cannot be assumed simply because a business fails or financial accounts remain disputed.”
Tinani added that the ruling reinforces the principle that criminal law should not be used as a shortcut for resolving business disputes that belong before civil courts.
