Your Judgment Debtor Moved Assets to Family Members: Can the DIFC Courts Unwind the Transfers?

Yes, in principle. A judgment creditor whose debtor has put assets into the names of adult children or other relatives can sue the family members themselves in the DIFC Courts, asking the Court to unwind the dispositions, to declare that an apparent transfer concealed a different arrangement, and to award damages for the harm caused. Those causes of action come from the federal Civil Transactions Law, not from DIFC substantive law, and the DIFC Courts hear them only if a gateway in Dubai Law No. 2 of 2025 is satisfied. Freezing relief against the transferees and an order that they disclose assets are separate applications with their own tests, and a freezing order preserves what is left rather than restoring what has gone.

Two sets of official DIFC Courts orders show how far this gets. In Emirates NBD v Almakhawi, CFI 039/2025, 3 April 2026, a bank owed roughly USD 90 million under Dubai and English judgments sued the debtor and three of his adult children, and the Court dismissed every jurisdiction challenge and granted a worldwide freezing order. In Trafigura v Gupta, CFI 040/2025, 9 September 2026, a freezing order against a spouse who was not a defendant to the underlying claim survived an attempt to discharge it, but the creditors were refused the consent regime and the disclosure they wanted. Both are interlocutory, and neither finds that any transfer was a sham or that any asset belongs to the debtor.

Can the DIFC Courts unwind transfers a judgment debtor made to family members?

They can be asked to, and the claim can proceed, but no published DIFC decision has yet decided one on its merits. In Emirates NBD v Almakhawi the bank pleaded three heads: damages for acts causing harm, orders unwinding transfers made to the detriment of the debtor's creditors, and declarations that transactions between the defendants were sham transactions. Its particulars added that the children held the assets to the debtor's order as agents or bailees, that gifts were void where the donor's debts had already swallowed his property, and that the dispositions were not enforceable against the bank. The Court held that there were good arguable cases that each defendant had acted in concert to place the debtor's assets beyond the bank's reach and that the bank had suffered harm. It then said in terms that it had not prejudged the question but merely accepted that there was a serious issue to be tried, and that the defendants still had the benefit of the doubt.

A creditor who reads either order as establishing that transfers to relatives are reversible is reading an interim decision as a merits judgment. What they establish is that the claim exists, that the DIFC Courts can hear it, and that the Court will protect what remains while it is tried.

Key takeaway. A good arguable case is one more than barely capable of serious argument, not one the judge believes has a better than even chance. Both orders rest on that threshold, and neither decides who owns anything.

Which law supplies the claims, and did it change in 2026?

The claims come from the federal Civil Transactions Law, and the numbers changed on 1 June 2026. Both orders use the numbering of Federal Law No. 5 of 1985, but not the same provisions. Almakhawi runs on harm at Article 283, the property standing as security at Article 391, simulation at Articles 394 and 395, non-enforceability at Article 397 and the void gift at Article 623. Trafigura runs on the indirect action at Articles 392 and 393, simulation at Articles 394 and 395, and the Paulian action at Articles 396 to 398. The current instrument is Federal Decree-Law No. 25 of 2025 Promulgating the Civil Transactions Law, in the Official Gazette of 14 October 2025 and effective from 1 June 2026, which the official federal portal serves as active. On that text, harm is Articles 246 and 247, the security of the debtor's assets Article 341, the indirect action Article 342, simulation Article 343, the non-enforceability claim Articles 344 to 349, and the gift void where the donor's debts encompass his property before the donee takes possession Article 561.

One change is not cosmetic. Article 344 separates the cases. A disposition for consideration is non-enforceable where the debtor was bankrupt or insolvent and the transferee knew of that, and Article 345 reaches a disposition for consideration on its own terms, where the creditors have demanded payment from a debtor whose debts encompass all his property, with no knowledge required on the transferee's part. A gratuitous disposition the debtor was not obliged to make and which is not customary is not enforceable against the creditor, in the words of the provision, even if the beneficiary acted in good faith and the debtor did not commit fraud. A sub-transfer for consideration is reachable only where both successors knew of the fraud. Article 346 leaves the creditor to prove the debt and the debtor to prove property exceeding it, and Article 349 bars the claim three years after the creditor learns of the reason and in all cases fifteen years after the disposition.

So the argument one side's UAE law expert advanced in Trafigura v Gupta, that a Paulian claim requires proof of an intention to defraud, came from Dubai Court of Cassation authority rather than the words of the former text, and concerned 2020 and 2021 dispositions. On the current wording that condition is expressly displaced for a gratuitous disposition. Which text governs a given transfer is answered by Article 4(1), which says the law is not retroactive, so a disposition made before 1 June 2026 is still tested under the 1985 text, where the claim additionally required that the creditors had already claimed against the debtor. Limitation is the exception, because Articles 6 and 7 pull the new periods onto periods still running.

The cards below restate three structural points.

Can the DIFC Courts hear a claim against transferees who have no DIFC connection?

Yes, where the claimant or a defendant falls within one of the gateways, and the gateway turns on status rather than connection. In Emirates NBD v Almakhawi all four defendants argued that the bank was neither a DIFC Establishment nor a Licensed DIFC Establishment within Article 2 and Article 14(A)(1) of Dubai Law No. 2 of 2025, so the Court had no jurisdiction over a claim about transfers made outside the DIFC between people living outside it. The Court held that the bank was plainly a DIFC Establishment, because the financial regulator has permitted it, under DIFC legislation, to act as a broker on the exchange based in the DIFC, and that it was also a Licensed DIFC Establishment, because that recognition entitles it to carry on activities within the statutory definition of financial services. The defendants put the jurisdictional burden on the claimant on a good arguable case basis.

That finding has now been tested. Permission to appeal was refused at first instance, the second defendant renewed the application, and on 2 July 2026 the Court of Appeal dismissed the renewed application, holding that no ground had a real prospect of success and that there was no other compelling reason to hear the appeal. On Article 14(A)(1) it held that any difference in wording from the predecessor law is explained by changes in the financial services legislation, that membership of the exchange does confer authority to carry on financial services, that activity performed remotely for an exchange based in the DIFC is still activity in or through the DIFC, and that jurisdiction depends on the status of the entity rather than the activity from which the dispute arose. The reasons are detailed and against the challenge. But permission was refused rather than an appeal heard, so there is still no appellate construction of Article 14(A)(1) reached after a full appeal hearing.

Can the defendants have the claim sent to the Dubai Courts instead?

Not on forum grounds, where the competing forum is another court of Dubai. The defendants in Emirates NBD v Almakhawi argued that everything pointed onshore: the parties, the events, the governing law, the language of the documents, and the Dubai judgment said to have been frustrated. The Court held that it was bound by Court of Appeal authority that the DIFC Courts cannot apply forum non conveniens where the alternative forum is another court of the UAE, and that the reason survives the 2025 Courts Law, because the Emirate has a statutory mechanism for conflicts of jurisdiction which leaves no room for a discretion to decline.

The Court of Appeal added a textual point when it refused permission. Article 14(C) lists two cases in which the DIFC Courts may decline jurisdiction, and if anything that implies those two are the only ones. It also observed that the grounds for a forum stay were weak in any event, because the claims against the transferees had never been ventilated elsewhere and were separate and distinct from the guarantee liability the Dubai Courts had decided.

What must a freezing order against a transferee prove, and against whom?

The four familiar requirements, and dissipation has to be proved against each respondent separately. Emirates NBD v Almakhawi applied the test confirmed by the DIFC Court of Appeal in Ithmar Capital: a good arguable case, assets the defendant has or may have that will be available to satisfy a judgment, a real risk that the judgment will not be satisfied because of an unjustifiable disposal, and that the order is just and convenient. The existence of assets needs no specific proof, only grounds for belief, and dissipation risk must rest on solid evidence.

Two transferees said the only material against them was a jurisdiction challenge, payments to jewellers from accounts in their names, and the fact that proceedings now existed so they had an incentive to avoid judgment. The Court discarded the first and third: an arguable jurisdiction challenge is not evidence of an intention to dissipate, and an incentive to avoid judgment exists in every claim ever brought. What it did not discard was an unexplained conversion of a very large sum into gold.

Where the holder is not a defendant to the underlying claim, Trafigura v Gupta applies. Relief then needs an arguable case that the holder holds assets in one way or another for the debtor, and a separate arguable case that enforcement against those assets would be available in satisfaction of the judgment. Suspicion supported by speculation does not make the arguable case required.

Does it matter that none of the assets sits inside the DIFC?

No. In Emirates NBD v Almakhawi the defendants said there were no assets in the DIFC, and the Court held that irrelevant, citing the Court of Appeal in Trafigura v Gupta [2025] DIFC CA 001, decided on 22 September 2025, which is the authority under the current law. It held that jurisdiction to enforce judgments of foreign courts derives from Article 31(4) of the 2025 Courts Law, that a freezing order sought in aid of that jurisdiction needs no separate head of jurisdiction, and that Article 15 read with Article 15(4) confers it expressly in any event. On the argument that the words inside the DIFC require the assets to be there, it held that the controlling words are suitable precautionary measures within the DIFC and that it would be surprising in the extreme for a substantial narrowing of the Court's powers to be achieved by a connecting term in one translation.

What the order will not do is execute itself onshore. Trafigura v Gupta records that conduit enforcement of a DIFC decision outside the DIFC requires a decision that is final and executory, a requirement reflected in Article 32 of the 2025 Courts Law and in the court rules, and that a freezing order is an interim remedy which does not qualify. The Court limited the order to protecting assets said to be susceptible to onshore enforcement, said it was for the creditors to start those proceedings, and took an undertaking that they would not enforce it outside the UAE without permission.

Deadline warning. A transferee disputing jurisdiction must file an acknowledgment of service and then apply under Part 12 of the Rules of the DIFC Courts within 14 days of filing it, supported by evidence. Miss that window and the rule treats the party as having accepted jurisdiction.

What disclosure will the Court order, and what will it refuse?

Disclosure that makes the freezing relief effective, and nothing whose connection to that purpose is not demonstrated. The power is Rule 25.1(7) of the Rules of the DIFC Courts, which allows an order for information about assets which are or may be the subject of a freezing application. It is usually made alongside the freezing order and carries short deadlines. The order in Trafigura v Gupta required the first respondent to identify, within four working days, all UAE assets above USD 65,000 whether in his own name or not, with value, location and details, and to swear an affidavit within seven working days. Emirates NBD v Almakhawi went wider, requiring assets worldwide above USD 10,000 and, for precious metals and gemstones, their location and every past and present custodian, vault or storage provider.

The limits are as instructive as the powers. In Trafigura v Gupta the creditors also asked for disclosure of the source of the funds paying the respondent's DIFC legal fees, arguing that heavy spending by someone who had declared modest cash suggested undisclosed assets. The Court dismissed that, holding it was not demonstrated to have a sufficient connection to protecting the assets said to be held for the debtor. They also failed to convert a notification regime into one requiring their consent before any dealing. The Court called that too draconian, given that the relief rests on nothing higher than arguable cases, and instead lengthened the notice period from 72 hours to 21 days with six specified items, including independent evidence of value and a breakdown of the intended use of the proceeds.

What does delay in applying cost the creditor?

Less than defendants usually argue, but it is a real discretionary factor and the order of reasoning matters. The chronology in Emirates NBD v Almakhawi was uncomfortable for the bank: the judgment dated from 2019, the share transfer complained of was discovered in October 2020, proceedings were issued in April 2025, and the freezing application came only in December 2025. The defendants said that was inexcusable and fatal. The bank accepted significant delay between knowledge of some transactions and the application.

The Court then separated two questions. First, is there a risk of an unjustified dissipation directed at thwarting enforcement? If there is, the second is whether delay has been inexcusable enough to refuse relief anyway. Where the Court is satisfied its processes may be frustrated, the delay would have to be both inordinate and inexcusable. Measuring from the commencement of the proceedings it found eight months, noted that the pleaded causes of action had not been raised before, held the delay neither inordinate nor inexcusable, and added that the defendants could point to no prejudice. An applicant is also entitled to take reasonable time to investigate.

What does the evidence behind a transfer have to show?

Three things, asset by asset: what moved, when it moved relative to the creditor's claim, and what the transferee gave for it. The narrative in Emirates NBD v Almakhawi is a template. It recorded the dates of a precautionary attachment and of each appeal judgment, and against them the date of each disposition: properties gifted to the children in a defined window, a shareholding transferred eight days after an appeal was dismissed, a property title transferred the day after an appeal judgment, a waiver of an inheritance share, and distributions requested from offshore structures days after adverse procedural steps. It excluded transactions it regarded as likely normal living expenses. It also recorded that courts elsewhere had decided claims under their own statutes about some of the same dispositions, and that recoveries elsewhere reduce the harm claimed here.

Silence is evidence too, within limits. The Court disregarded one defendant's witness statement as submission disguised as evidence and observed that the absence of any response to the factual allegations underlined the serious issues to be tried. For a creditor's affidavit the lesson is that an unexplained transaction, set against a specific question, is worth more than an adjective.

What happens if a respondent does not comply with the disclosure order?

The Court escalates, and the escalation reaches the ability to defend. In Emirates NBD v Almakhawi the freezing order required disclosure and an affidavit within nine days. One respondent applied for an extension, let the extended date pass, and then served an unsworn document. On 17 April 2026 the Court held that a document which is not an affidavit is not compliance at all, dismissed the extension application with indemnity costs because applying for more time and then missing it justifies that basis, and granted an unless order: absent disclosure and a sworn affidavit by a fixed date, the respondent would not be permitted to advance any defence. It also required bank statements back to January 2020, records on the acquisition and disposal of metals, gemstones and jewellery, and written requests to two named banks for six years of statements. Both orders were directed to bear penal notices.

Both orders also fix what they do not prohibit. Each carved out ordinary living expenses and a reasonable sum for legal advice, in one case against an unevidenced claim for four times the figure allowed, and in the other subject to telling the applicants' lawyers the amount and the source before spending. Those are case figures, and none carries across.

What answers do transferees give, and which ones have landed?

The ones that have landed are about the creditor's own case rather than the transferee's virtue. In Trafigura v Gupta the respondent argued that none of the creditors' proposed onshore enforcement routes worked, because they were not creditors of the company that had sold the properties, because the sales long predated the claim, and because the indirect action requires an identified right the debtor has failed to exercise. Expert letters went both ways. The Court declined to express a concluded view, holding each route arguable on certain factual hypotheses and that no more could be said at an interim stage. That is a partial success for both sides, because it keeps the merits open and because arguable is the threshold.

The attack that failed was on the creditor's conduct. The respondent applied to discharge an order made in her absence for breach of the duty of full and frank disclosure, with a long schedule of alleged failures. The Court applied the established principles, including that immediate discharge is the starting point where a failure is substantial or deliberate. It accepted that the earlier submissions could have been more careful and the procedure untidy, was not satisfied there had been a substantial or deliberate failure, noted that the merits had since been argued in full with expert evidence on both sides, and dismissed the application with costs, noting that quality rather than quantity is the watchword for such an attack.

Two further answers are structural. A finding of arguability on an application heard without the other side is not a determination of the criteria. And costs do not follow success where success is split: the respondent paid half the costs of the variation application and all of her discharge application.

The cards restate the limits running through both orders.

What does the creditor's sequence look like, from judgment to unwinding?

The order of work follows the conditions the Court tests, and most of it is evidence.

1. Fix the judgment position: the operative judgments and the sums outstanding after recoveries anywhere in the world.
2. Identify the gateway first. Article 14(A)(1) depends on the status of a party, so establish that status on evidence, not on where the events happened.
3. Build a transfer-by-transfer schedule, and record against each transfer the enforcement step it followed or preceded.
4. Decide which claims the facts support, because non-enforceability, simulation, harm and an indirect claim carry different conditions and different limitation rules.
5. Prepare the risk evidence separately for each respondent, and expect a tactical jurisdiction challenge and a general incentive to avoid judgment to count for nothing.
6. Decide on notice or without notice, remembering that a without-notice application needs affidavit evidence, reasons for not giving notice and full and frank disclosure.
7. Price the undertaking in damages before you apply, draft the disclosure order to the purpose of protecting the identified assets, and plan for the return date.
8. Start the substantive enforcement proceedings the order is said to protect, and keep the compliance record, because the escalation to an unless order runs on it.

What do creditors in this position get wrong?

The two expensive mistakes here are about sequencing rather than law. The first is pleading every available head because the facts look bad, which produces a case where the weakest claim attracts the most argument and the limitation question multiplies. Emirates NBD v Almakhawi shows how fast that happens: the Court could not resolve whether UAE or DIFC limitation applied, whether the federal period is substantive or procedural, or which of two competing translations governed. The second is treating interim protection as the remedy, when both orders preserve assets so a claim can be tried and, if it succeeds, enforced somewhere. Costs discipline sits at the same level: no immediate assessment was made because no complying statement of costs had been filed, and on assessment the receiving party lost the cost of submissions it had to file only because its first statement left a fee worth about half the bill unparticularised. Searches of the court's published lists found no later order in either claim and no merits appeal in Emirates NBD v Almakhawi, only the refusals of permission described above, and they are not a court-file certification, while every federal provision here is read from the official portal's English text, which it serves subject to its own statement that the Arabic prevails.

Frequently Asked Questions

Can I sue my debtor's children directly, or must I go back to the court that gave me judgment? You can sue the transferees directly, because a claim to unwind a disposition or to declare it a simulation is a different cause of action against different parties from your claim against the debtor. In Emirates NBD v Almakhawi the Court held that the claims against the children were separate and distinct from the guarantee liability the Dubai Courts had decided, which is also why double recovery was not an objection.

Does the DIFC Court need the assets to be inside the DIFC? No. The Court held in Emirates NBD v Almakhawi that the absence of assets in the DIFC is irrelevant, following the Court of Appeal in Trafigura v Gupta, which held that a freezing order sought in aid of the Court's enforcement jurisdiction needs no separate head of jurisdiction and that Article 15(4) of Dubai Law No. 2 of 2025 does not require the assets to be there.

If the transfer was a gift, do I still have to prove an intention to defraud? That depends on when the transfer was made. Article 344(2) of the Civil Transactions Law in force from 1 June 2026 provides that a gratuitous disposition the debtor was not obliged to make and which is not customary is not enforceable against the creditor even if the beneficiary acted in good faith and the debtor did not commit fraud. A transfer made before that date is tested under the 1985 text, on which Dubai Court of Cassation authority treats an intention to defraud as a threshold condition.

How long do I have to bring the claim? Three years, with a fifteen-year longstop, and these periods apply to your transfer whenever it was made, because Articles 6 and 7 bring the new limitation rules onto periods that were still running on 1 June 2026. A non-enforceability claim is barred three years after you learn of the reason for it and in all cases fifteen years after the disposition, and a claim for harm is barred three years after you learn of the damage and the person responsible and in all cases fifteen years after the act. Whether the federal period or the six-year period in Article 28 of Dubai Law No. 2 of 2025 applies to a DIFC claim was left unresolved in Emirates NBD v Almakhawi.

Will delay in applying for a freezing order sink the application? Not by itself. The Court in Emirates NBD v Almakhawi asked first whether there was a real risk of unjustified dissipation and only then whether delay should defeat relief in its discretion, holding that the delay would have to be both inordinate and inexcusable, that eight months from commencement was neither, and that the defendants could show no prejudice.

Can I get a freezing order against a relative I am not suing at all? Potentially, on the basis described in Trafigura v Gupta. You need an arguable case that the person holds assets in one way or another for the judgment debtor, and a separate arguable case that enforcement against those assets would be available in satisfaction of your judgment. Suspicion supported by speculation is not enough.

Can I make the transferee tell me who is paying their lawyers? Not without showing why that protects the assets. The Court refused exactly that application in Trafigura v Gupta, holding that it was not demonstrated to have a sufficient connection to the protection of the assets said to be held for the debtor, even though the creditors argued the spending was inconsistent with the cash position that had been disclosed.

What happens if a respondent ignores the disclosure order? The Court escalates rather than overlooks. In Emirates NBD v Almakhawi an unsworn document was held not to be compliance, the extension application was dismissed with costs on the indemnity basis, an unless order was made so that continued failure would bar the respondent from advancing any defence, a wider production order followed, and both orders were directed to carry penal notices.

This article is for general informational purposes only and does not constitute legal advice. Consult a qualified advocate for advice on your specific situation.

Related Guides

Our judgments, awards and enforcement page treats recognition and enforcement as separate stages, and covers freezing orders and asset disclosure.

• The Debtor Is Moving Assets: Can I Get a DIFC Freezing Order?
• You Won a DIFC Judgment but Cannot Find the Debtor's Assets
• Personal Debt and Company Assets: What Exactly Can Be Sold?