Injunction against Viceroy 'suspended', says FIVE Holdings

Viceroy Hotels and Resorts had insisted it was still entitled to manage Dubai hotel
By Sarah Townsend
Mon 03 Jul 2017 10:28 AM

FIVE Holdings claimed on Monday that an injunction preventing it from taking steps to wrestle control of Dubai’s Palm Jumeirah Hotel from Viceroy Hotels and Resorts had been suspended.

In the latest twist in a legal battle that emerged last month, the hotel owner FIVE Holdings’ chairman and CEO Kabir Mulchandani said an injunction won by Viceroy in DIFC Courts was effectively nullified pending further court decisions.

Mulchandani said: “The Dubai Joint Judicial Committee, a judicial body to resolve disputes between Dubai and DIFC Courts, has decided to suspend the matter pending before DIFC Courts and Dubai Courts until it decides which is the relevant court.

“This was confirmed by the Dubai Joint Judicial Committee on June 29, 2017 and further ratified by a letter issued on  July2, 2017. Viceroy is referring to an order dated  June 22 2017, which has been suspended by force of law.

“Our hotel has been licensed by DTCM [Dubai Tourism and Commerce Marketing] as a FIVE Hotel, a copy of which is attached and remains in our hotel lobby.

“FIVE Holdings has invested over $2bn of real estate and hospitality projects in Dubai and our commitment to Dubai stands in actions.”

The statement came after Viceroy claimed on Sunday night the June 22 injunction was still in place. The group said it had issued its statement following an earlier, “inaccurate” one from Mulchandani insisting FIVE Holding remains in control.

Viceroy’s statement said: “Viceroy Hotels and Resorts (‘Viceroy’) notes today’s statement by Kabir Mulchandani, chairman and CEO of FIVE Holdings Limited (“FIVE”), relating to the Viceroy Palm Jumeirah Hotel.

“Viceroy confirms that the injunction issued by the DIFC Courts on  June 222017 remains in place. That order prohibits the owner of the Viceroy Palm Jumeirah Dubai hotel from taking any steps to prevent Viceroy from exercising its exclusive authority to manage the hotel, and orders the reinstatement of Viceroy. As such, today’s statement by FIVE is inaccurate in many respects.”

Two weeks ago, FIVE Holdings dramatically took over operation of the Viceroy Palm Jumeirah hotel less than three months after its official opening.

All Viceroy-branded signs were removed from the hotel entrance, as FIVE Holdings said in a statement, “We believe now is the right time to disrupt the hospitality industry.”

Viceroy fought back by successfully acquiring an injunction from DIFC Courts prohibiting FIVE Holdings from preventing Viceroy from managing and operating the hotel.

Viceroy claimed the owner’s actions at that time breached the existing hotel management agreement, and pledged to take steps to ensure FIVE, as the hotel’s owner, complied fully with the terms of the court order and management agreement.

On Sunday night, Viceroy Hotel Group CEO Bill Walshe said: “We maintain our position that Viceroy has always been, and remains, the legal manager of the Viceroy Palm Jumeirah Dubai.

“We are deeply disappointed that the owner of the hotel refuses to recognise this, despite the orders of the DIFC Courts, which were issued on 22 June and remain in place.

“Such actions threaten the entire business community in Dubai.  Not only are FIVE and its affiliates creating confusion amongst colleagues, guests, residents and investors, they are also defying the authority of the DIFC Courts.

“Viceroy also deeply regrets the inconvenience and confusion FIVE’s actions have caused, and continue to cause, our loyal colleagues, hotel guests, purchasers of real estate units in the project, local business partners in Dubai and travel industry partners globally.

“We call on FIVE and its affiliates to act in the best interest of all of the hotel’s stakeholders and to allow Viceroy immediate access to the hotel property in order to resume its role as the rightful manager of the Viceroy Palm Jumeirah Dubai.”

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