Abu Dhabi Court of Cassation Clarifies Liability Under Investment Management and Custody Arrangements

An Abu Dhabi Court of Cassation judgment clarifying that the liability of licensed financial institutions in managed investment arrangements depends on the substance of their contractual roles, rather than labels such as “limited-discretion manager” or agent. The Court confirmed that institutions assuming investment-management, custody and liquidation responsibilities may be liable for outstanding investment balances, while directors and managers are not automatically personally liable absent separate wrongdoing.