The document you’ve provided outlines the decision made by the Authority for the Unification of Federal and Local Judicial Principles in Application No. 1 of 2023 concerning the legal status of bounced checks, particularly when the reason for the bounce is the closure of the account by the drawee.

Key points from the document include:

**Decision Summary**: The Authority has decided, based on a majority opinion, that the phrase “closing the account” should be considered equivalent to “lack of balance and insufficient balance” as stipulated in Article 667 of Federal Decree-Law No. 50 of 2022 regarding the Commercial Transactions Law. This decision aims to provide clarity and consistency in how bounced checks are treated under UAE law.

**Legal Context**: The Authority’s decision contrasts with the stance previously adopted by the General Authority of the Court of Cassation in Abu Dhabi and Dubai. These courts had prohibited the analogy of treating account closure similarly to insufficient funds, viewing it as a departure from the original intent of the law.

**Statutory Basis**: Article 635 bis of the Commercial Transactions Law, as amended by Decree-Law No. 14 of 2020, defines that a bounced check due to insufficient funds is considered an executive document. The legislator intended for checks bounced under these circumstances to be enforceable without further procedural hurdles.

**Teleological Interpretation**: The decision by the Authority reflects a teleological interpretation of the law, which considers the purpose and objectives behind legal provisions. By equating account closure to insufficient funds, the Authority aims to uphold the efficiency and integrity of commercial transactions, ensuring that creditors’ rights are protected promptly.

 **Impact and Implementation**: Treating account closure as a basis for considering a bounced check an executive document facilitates quicker legal recourse for creditors. This is seen as essential for maintaining trust and efficiency in commercial dealings, discouraging potential abuses where debtors might attempt to evade obligations by closing their accounts.

In conclusion, the decision in Application No. 1 of 2023 by the Authority for the Unification of Federal and Local Judicial Principles establishes a significant legal precedent in UAE jurisprudence, aiming to streamline procedures and protect the interests of parties involved in commercial transactions affected by bounced checks.

The document you’ve provided further elaborates on the decision of the Authority for the Unification of Federal and Local Judicial Principles regarding bounced checks and the closure of accounts under UAE law. Here are the key points highlighted in the passage:

**Equivalence of Account Closure**: The Authority has decided that closing an account should be considered equivalent to insufficient funds or lack of balance when determining whether a bounced check qualifies as an executive document. This interpretation aligns with a teleological approach to legal interpretation, focusing on the purpose and objectives of the law to ensure stability in commercial and banking transactions.

**Conditions for Account Closure**: The document specifies that current accounts can be closed under various circumstances, including by mutual agreement of parties or due to specific events such as bankruptcy or the bank ceasing operations. Implicit actions or expressions indicating the intent to close an account are also recognized.

**Legal Impact**: Treating account closure as akin to insufficient funds for bounced checks aims to streamline legal processes. This prevents debtors from evading their obligations by closing accounts deliberately, which could harm creditors and undermine the efficiency of commercial transactions.

 **Contrast with Previous Court Rulings**: The Authority’s decision contrasts with rulings from the Dubai Court of Cassation (Appeal No. 888 of 2023 Commercial), which had previously emphasized that only checks bounced due to insufficient funds are considered executive documents. In contrast, the Abu Dhabi Court of Cassation (Appeal No. 460 of 2023 Commercial) supported the view that account closure should be equated with insufficient funds, thus allowing creditors to enforce bounced checks.


**Protecting Creditor Rights**: By equating account closure to insufficient funds, the Authority aims to protect creditors’ rights more effectively. This prevents debtors from exploiting loopholes in the law to delay or avoid payment obligations.

In conclusion, the decision in Application No. 1 of 2023 by the Authority for the Unification of Federal and Local Judicial Principles represents a significant development in UAE jurisprudence concerning bounced checks and account closures. It underscores the importance of legal interpretation in maintaining the integrity of commercial transactions and ensuring equitable outcomes for all parties involved.