Remedies and enforcement

Interim remedies

What interim remedies are available and commonly sought in technology disputes in your jurisdiction?

Technology disputes are treated in the same manner as other disputes.

Various interim remedies are available to the suffering party. Those include, but are not limited to, freezing orders and the preservation of assets and evidence.

The claimant may submit an application to the relevant court for an interim remedy. The claim may also be submitted to the Court of Urgent Matters if the claimant requires the matter to be dealt with expeditiously. 

In addition, an arbitral tribunal in Bahrain has the power to order preliminary or interim relief. The types of relief available those set out above as well as orders to prevent any prejudice to the arbitral procedure. 

A party requesting an interim measure must satisfy the arbitral tribunal that harm not adequately reparable by an award of damages is likely to occur, and that there is a reasonable possibility that the requesting party will succeed on the merits of its claim or defence. 

An arbitral tribunal may require the party requesting an interim measure to provide appropriate security, and may modify, suspend or terminate an interim measure either on the application of one of the parties or, in exceptional circumstances, on its own initiative.

Upon application by a party, the Bahraini High Civil Court will recognise and enforce an interim measure issued by an arbitral tribunal, irrespective of the country in which it was issued, subject to limited grounds for refusing enforcement, including invalidity in law, incapacity of a party and improper composition of the tribunal. 

Furthermore, the Bahraini Civil High Court has the same power to issue an interim measure in relation to arbitral proceedings, irrespective of whether the seat of the arbitration is Bahrain, as it has in relation to proceedings in the courts, and will exercise such power in accordance with its own procedures, having regard to the specific features of international arbitration. 

Substantive remedies

What substantive remedies are available and commonly sought in technology disputes in your jurisdiction? How are damages usually calculated?

The substantive remedies that are commonly sought in Bahrain are damages and specific performance. 

The courts in Bahrain would generally consider all the relevant factors of the claim when assessing damages. Article 161 includes that damages are limited to the loss incurred and loss of profit by the aggrieved party. Damages are also extended to cases where the damages suffered are moral (article 162 of the Civil Code). The court would generally assess damages on a case by case basis as it would consider all the relevant factors. Loss of profits and moral damages are often included in the calculation of damages.

Limitation of liability

How can liability be limited in your jurisdiction?

Parties should seek to limit their liability under a contract, such as by excluding liability for certain losses, such as those that were not caused directly by the party in breach, or by including a cap on the amount of compensation recoverable.

The Civil Code also includes several provisions relating to limiting liabilities. For instance, under article 422 of the Civil Code, in the case of sold goods, the contracting parties may agree to increase, limit or discharge liability where the goods are defective. However any agreement to discharge or limit the liability will be deemed null and void if it is found that the seller has fraudulently concealed the defect.

Liquidated damages

Are liquidated damages permitted? If so, what rules and restrictions apply?

Liquidated damages are permitted in Bahrain. Article 226 of the Civil Code states:

 

No agreed compensation shall be payable if the debtor proves that the creditor has suffered no damages.

The court may decrease the agreed amount of compensation if the debtor proves that the amount fixed is overestimated or if the obligation has been performed in part.

Any agreement to the contrary shall be null and void.

 

Accordingly, the parties may agree a sum that is equivalent to the potential losses suffered by one of the parties due to the breach of the other party. However, this compensation would not be enforceable if the party claiming for liquidated damages has not actually suffered any damages. The court may also decide to reduce the amount of liquidated damages so that it is equivalent to the actual loss suffered.

Enforcement

What means of enforcement are available and commonly used by successful litigants in technology disputes in your jurisdiction?

Technology disputes are not differentiated from other commercial disputes.

A party seeking enforcement should apply to the Bahraini Court of Execution. 

Available methods of enforcement include: 

  • issuing an attachment order on property; 
  • ordering the forced sale of property subject to the attachment order; 
  • ordering the payment of amounts under the judgment; 
  • collecting payment and transferring it to the successful party; 
  • seeking assistance from the police, if necessary; 
  • ordering the arrest of the debtor; 
  • levying a distraint on the debtor’s property (including stocks and bonds) in order to satisfy the debt; and 
  • ordering the sale of any property (movable and immovable) by public auction. 

 

Under Bahraini law, an arbitral award shall be recognised as binding, irrespective of the country in which it was made (as long as that country is a signatory to the New York Convention), and, upon application in writing to the Bahraini High Civil Court, shall be enforced subject to limited grounds for refusing recognition or enforcement.