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AL MAZAYA HOLDING COMPANY K.S.C.P. AND ITS SUBSIDIARIES
NOTES TO INTERIM CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED)
MARCH 31, 2024
(All amounts are in Kuwaiti Dinars)

14. Contingent liabilities and legal cases
As at March 31, 2024, the Group is contingently liable in respect of letters of guarantee amounting to KD 175,732
(December 31,2023 - KD 193,492, March 31,2023 - Nil).

During the year ended December 31, 2020, two subsidiaries of the group had filed lawsuits before the courts of the
Emirate of Dubai in the United Arab Emirates against some investors regarding the development of real estate projects
in the Emirate of Dubai in the United Arab Emirates. During the year ended December 31, 2021, the Court of Cassation
upheld the judgment issued by the Court of Appeal, which had previously upheld the judgment of the Court of First
Instance issued in favor of the two subsidiaries of the group about their entitlement to a total amount of AED
19,780,852, in addition to the legal interest of 9% from the date of the judicial claim till full settlement, whereby the
entitlement of those subsidiaries including the legal interest until December 31, 2021 had amounted to AED 25,968,142
(equivalent to KD 2,176,172) according to the latest calculations for that entitlement by the court, and hence, the
management of those subsidiaries had decided to reverse the provisions recorded in their books against their full
entitled amount according to the Court’s verdict including the legal interest up till December 31, 2021 which is reported
as provisions no longer required in the consolidated statement of profit or loss for the year ended December 31, 2021.
The subsidiaries of the group initiated legal execution procedures against those investors for the fulfilment of that
verdict along with its legal interest, which resulted in the collection of almost 82% from the total amount due to the two
subsidiaries till March 31, 2024, whereas the remaining amount is currently under collection by the Group’s two
subsidiaries in the United Arab Emirates. As a result of those lawsuits, the defendants filed a counter-lawsuit against
the Parent Company, the two subsidiaries and others demanding for the payment of AED 261,026,454 (equivalent to
KD 21,874,441) in addition to the legal interest of 5% from the date of the judicial claim till full settlement, in addition
to demanding payment of AED 50,000,000 (equivalent to KD 4,190,081) as compensation for lost profits. a court verdict
was issued by the Court of First Instance in favor of the defendants (Parent Company, the two subsidiaries, and others)
to disregard this lawsuit because of the previous judgement in that lawsuit, and obligating the plaintiffs to pay the
deferred fees yet to be paid for that lawsuit. The plaintiff had appealed in front of Court of Appeal against the Court of
First Instance’s verdict, and the lawsuit is still currently under hearing in front of the legal courts. The Group’s
independent legal counsel believes that the Group has a solid standing in those lawsuits based on the ruling issued in
the Group’s favor by the Court of First Instance, and hence, no provisions were booked against those lawsuits as of
the date of the accompanying interim consolidated financial information.

During the comparative year ended December 31, 2023, some buyers of real estate units in one of the Group’s projects
in the Emirate of Dubai filed a lawsuit demanding to terminate the booking forms of the subject real estate units and to
refund an amount of AED 5,530,321 (equivalent to KD 463,450) in addition to the legal interest of 9% until full payment.
Subsequent to the date of the accompanying interim consolidated financial information, the Court of First Instance
issued a judgment obliging the parent company and its subsidiary jointly to pay an amount of AED 2,944,130
(equivalent to KD 246,845) and the legal interest thereon at the rate of 5% annually from the date of the judicial claim
until full payment. The Group, as a precautionary measure, had recorded full provisions for the value of that judicial
claim in its records during the year 2023 which exceeds the verdict value that was ruled against the Group. The Group
is currently in the process of appealing against this judgment as that lawsuit is still currently under hearing in front of
the legal courts as at the accompanying consolidated interim financial information date.

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