Legal Articles
Ali P
legal consultant voicing his wish in Abu Dhabi's involvement to rework
the federal legal framework.
Title: Major increase in court cases amid downturn
Quote from Article:
' "Given the recent property slump, I would like to see the whole
structure and content of the local and federal property laws (and
system of title registration) standardized and given a thorough review-
for once and for all," said Ballantine.'
Link: http://www.business24-7.ae/Articles/2009/8/Pages/09082009/08102009_22573112cf6c40c181711ebceed685c7.aspx
A free legal aid suggestion from a lawyer to help people who can't
afford legal costs.
Title: Call to extend free legal aid to civil cases
Link: http://www.business24-7.ae/Articles/2009/8/Pages/08082009/08092009_5d4f22975be44963ab237d1db8500028.aspx
And some comic relief. The comic relief is in the reader comments at
the bottom of the article.
Link: http://www.arabianbusiness.com/564293-dubai-officials-seize-piranhas-from-shops
Ali P
applicable for the global financial crisis:
'While there may be exceptional circumstances generally considered to
be legal ground for cancellation of a contract or reducing any party’s
obligations to a reasonable level, it is highly unlikely that the
global financial crisis could be considered as an exceptional
circumstance or force majeure. The global financial crisis could only
be considered as an economic risk of which any contracting party
should be aware and which should be factored in at the contract
negotiation stage.'
....
Also an interesting opinion on the Mizin case:
'During a course of action, the court may rule on its own motion that
a contract is void. An example of this is the judgment passed by the
Dubai Court of First Instance on 19 March 2009 in case no. 39/2009
(real estate case) in which the court held the contract of sale of a
property is void under Article 3 of Dubai Law 13 of 2008 regulating
the interim Real Estate Register in the Emirate of Dubai (Article 3
states that a sale or other disposition that transfers or restricts
title or any ancillary rights is void if it is not recorded in the
Register). It should be noted that this appears to be an unusual
approach by the court and it is unlikely that a court in the future
would make the same finding in the same or similar circumstances.'
And they talk about a case where they acted for the seller (I assume
developer) and how the purchaser lost the case. They mention that the
court made reference to the concept of Good Faith as per Article 246
of the Civil Code.
Link: http://www.hadefpartners.com/News/pageid/120-137/default.aspx?Mediaid=72
On Aug 10, 3:11 pm, Ali P <apirb...@gmail.com> wrote:
> The usual spiel about the Dubai judiciary system and comments by a
> legal consultant voicing his wish in Abu Dhabi's involvement to rework
> the federal legal framework.
>
> Title: Major increase in court cases amid downturn
>
> Quote from Article:
>
> ' "Given the recent property slump, I would like to see the whole
> structure and content of the local and federal property laws (and
> system of title registration) standardized and given a thorough review-
> for once and for all," said Ballantine.'
>
> A free legal aid suggestion from a lawyer to help people who can't
> afford legal costs.
>
> Title: Call to extend free legal aid to civil cases
>
> And some comic relief. The comic relief is in the reader comments at
> the bottom of the article.
>
Ali P
The implementing regulations for the Strata Law will be released soon
and developers are lobbying DLD and RERA to modify the regulations to
take care of their interests according to Clyde and Co.
'Although industry experts recognise the necessity of having a fully
operational Strata Law, there has been much lobbying of the Land
Department and RERA by industry players seeking to influence the final
form of the Regulations in an attempt to minimise the impact of the
Strata Law upon their current business model. '
It will contain some important disclosure provisions that are supposed
to protect investors:
'...it appears that the Strata Law will also be used as a tool to
regulate developers further by imposing disclosure obligations and
warranties with respect to their developments.'
If you talk to RERA/DLD/Government, we should ask them to include
clauses that ensure agents/brokers must clearly state any financial
incentives or in kind they receive from any party in the transaction
(e.g. developer). This will help our interests and agents interests
become aligned rather than skewed towards developers since some
received/are receiving secret commissions from developers based on
payments made that they did/do not tell us about us.
Link to article: http://www.clydeco.com/knowledge/articles/dubai-strata-title-a-new-world-for-developers-and-consumers.cfm
tajmahalr...@gmail.com
Slowdown signs - Demand soars for UAE construction dispute lawyers <http://steelguru.com/news/index/2009/08/13/MTA2ODU5/Slowdown_signs_-_Demand_soars_for_UAE_construction_dispute_lawyers.html>
SteelGuru
The Abu Dhabi Judicial Department said this week that labor courts in Abu Dhabi and Al Ain saw a 66% increase in recorded cases in the H1 of the year to ...
<http://news.google.com/news/story?ncl=http://steelguru.com/news/index/2009/08/13/MTA2ODU5/Slowdown_signs_-_Demand_soars_for_UAE_construction_dispute_lawyers.html&hl=en> See all stories on this topic
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-----Original Message-----
From: Ali P <apir...@gmail.com>
Date: Wed, 12 Aug 2009 01:34:50
To: Dubai Property Investors<dubai-proper...@googlegroups.com>
Subject: [Dubai Property Investors] Re: Legal Articles
According to opinion from this law firm, Force Majeure is not
applicable for the global financial crisis:
'While there may be exceptional circumstances generally considered to
be legal ground for cancellation of a contract or reducing any party’s
obligations to a reasonable level, it is highly unlikely that the
global financial crisis could be considered as an exceptional
circumstance or force majeure. The global financial crisis could only
be considered as an economic risk of which any contracting party
should be aware and which should be factored in at the contract
negotiation stage.'
dubaiinve...@gmail.com
The many Developments of the many <http://www.articlesbase.com/business-opportunities-articles/the-many-developments-of-the-many-developers-in-dubai-1118277.html> Developers in Dubai
In the past the Dubai Real Estate Development Business has been an oasis for any new coming want to be Real Estate Developer.
Empower your Business with BlackBerry® and Mobile Solutions from Etisalat
-----Original Message-----
From: Ali P <apir...@gmail.com>
Subject: [Dubai Property Investors] Re: Legal Articles
Ali P
construction companies may have become tired of waiting whilst before
they were willing to negotiate with the developer...
This is a survey of the construction industry in the middle east in
May by a legal firm titled : 'Boom and recovery: Understanding the
Middle East construction market'
Quotes from Article:
'Few contractors are willing to risk damage to their reputation by
taking on an influential developer or employer in arbitration or court
proceedings. “People take it more personally here than in the western
world. It is taken as a personal slight rather than a dispute between
two companies,” a director at a major consultancy comments. Many are
also wary of a dispute resolution regime that is untested and even
unpredictable.'
...
'Respondents believe that the lack of transparency and well-thought
out regulation has hindered inward investment. Steven Coates, director
at Davis Langdon says: “This is an opportunity for Dubai to listen to
town planners. The Middle East can really learn from this. We need 80
per cent planning and 20 per cent doing, rather than the other way
round.”'
Link: http://www.nortonrose.com/knowledge/publications/2009/pub21430.aspx?page=all&lang=en-gb
> Slowdown signs - Demand soars for UAE construction dispute lawyers <http://steelguru.com/news/index/2009/08/13/MTA2ODU5/Slowdown_signs_-_...>
> The Abu Dhabi Judicial Department said this week that labor courts in Abu Dhabi and Al Ain saw a 66% increase in recorded cases in the H1 of the year to ...
dubaiinve...@gmail.com
<http://www.estatesdubai.com/2009/08/arras-permission-mandatory-for.html>
By Exclusive Dubai
ARRA's permission mandatory for cancellation of projects in Ajman - Dubai Real Estate News - UAE Property Market Trends and Agent Reviews. ... "WE are accepted post-dated cheques from few developers whose projects are yet to begin or whose constructions have halted. We have also opened escrow accounts for them, and will be depositing cheques only when are sure about the progress of the work," Barguthi clarified. However, no clear information is available on the number of ...
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-----Original Message-----
Date: Wed, 12 Aug 2009 10:51:22
Subject: [Dubai Property Investors] Re: Legal Articles
Ali P
Al Fahim talks football, finance and the future
...
'We understand that you are due to receive a bonus payment from Royal
Group, the owners of Hydra Properties, at the end of this year. Is
that correct?
My contract with Hydra has always been based on bonus payments and
indeed it is my understanding also that Hydra Properties are about to
approve a bonus to reflect my work with them and the results achieved
in the past year.
Is it correct that this amounts to almost £100 million (Dh600m)?
Is that all? [laughs] Now seriously, the amount will be decided by
Hydra Properties to reflect the results achieved under my guidance.
Then it is correct that you are getting a substantial payment?
I will be receiving a bonus for the work I did as CEO of Hydra
Properties. However, the amount I will receive is a matter between me
and the Royal Group as two private parties to a private agreement.
But will it be adequate enough to buy Portsmouth?
Look, you can ask me this question in many different ways. Of course I
would not be buying a Premier League club if I didn't have the money
to do so. And I have always said that I will be funding this takeover
myself. You can make your own assumptions. I wouldn't expect you to
tell me what bonus you are getting as a reporter.'
Link to article: http://www.business24-7.ae/Articles/2009/8/Pages/14082009/08152009_fe4f2c78a8d348378a8f3c1b5c78d339.aspx
Ali P
even after payment of official registration fees to Developer:
http://www.thenational.ae/apps/pbcs.dll/article?AID=/20090815/NATIONAL/908149971/1010
Payment sent for demand of final completion from Government developer
and project not complete: http://www.thenational.ae/apps/pbcs.dll/article?AID=/20090811/BUSINESS/708119952/1005
On Aug 17, 2:57 pm, Ali P <apirb...@gmail.com> wrote:
> From 24/7:
>
> Al Fahim talks football, finance and the future
> ...
>
> 'We understand that you are due to receive a bonus payment from Royal
> Group, the owners of Hydra Properties, at the end of this year. Is
> that correct?
>
> My contract with Hydra has always been based on bonus payments and
> indeed it is my understanding also that Hydra Properties are about to
> approve a bonus to reflect my work with them and the results achieved
> in the past year.
>
> Is it correct that this amounts to almost £100 million (Dh600m)?
>
> Is that all? [laughs] Now seriously, the amount will be decided by
> Hydra Properties to reflect the results achieved under my guidance.
>
> Then it is correct that you are getting a substantial payment?
>
> I will be receiving a bonus for the work I did as CEO of Hydra
> Properties. However, the amount I will receive is a matter between me
> and the Royal Group as two private parties to a private agreement.
>
> But will it be adequate enough to buy Portsmouth?
>
> Look, you can ask me this question in many different ways. Of course I
> would not be buying a Premier League club if I didn't have the money
> to do so. And I have always said that I will be funding this takeover
> myself. You can make your own assumptions. I wouldn't expect you to
> tell me what bonus you are getting as a reporter.'
>
tajmahalr...@gmail.com
<http://www.albawaba.com/en/countries/UAE/252089> Abu Dhabi and China lead international economic recovery
Al-Bawaba
The recent visit of General Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, Deputy Supreme Commander of the UAE Armed Forces and Chairman of ...
<http://news.google.com/news/story?ncl=http://www.albawaba.com/en/countries/UAE/252089&hl=en> See all stories on this topic
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-----Original Message-----
Date: Mon, 17 Aug 2009 05:45:16
Ali P
'Very often in construction contracts disputes, it is when parties
have no choice but to resort to either arbitral or court proceedings
to resolve their disputes will they learn (often the hard way) the
words of wisdom of Max W Abrahamson when he wrote in his book entitled
“Engineering Law and the I.C.E. Contract”:
“A party to a dispute, particularly if there is arbitration, will
learn three lessons (often too late): the importance of records, the
importance of records and the importance of records.” '
Link: http://newsweaver.ie/altamimi/e_article001337161.cfm?x=bf6whc5,0,w
On Aug 17, 3:45 pm, Ali P <apirb...@gmail.com> wrote:
> No title deeds given for paid up properties by Government Developer
> Payment sent for demand of final completion from Government developer
dubaiinve...@gmail.com
Corruption inquiries total Dh3.6bn <http://www.thenational.ae/apps/pbcs.dll/article?AID=/20090819/NATIONAL/708189832/1183/enewsletter>
Anti-corruption investigators in Dubai are working on 11 separate cases involving 34 senior executives, according to prosecution files.
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-----Original Message-----
Date: Mon, 17 Aug 2009 04:57:54
Ali P
happy with the amendment to Law 13:
'...many developers and investors breathed a sigh of relief when Law
No. 9 of 2009 (Law No. 9) was introduced to clarify the provisions of
Article 11 of Law No. 13. '
And according to him from his discussions with Mr. Faroq of RERA:
'If construction has started but then ceased, and there is no
realistic chance of the project being completed by the developer
because, for instance, there are no funds remaining in Escrow, then
RERA would consider cancelling the project for being unviable. In
these circumstances, the plot would be auctioned and the profits
distributed between all purchasers. If there are insufficient profits
to distribute, a proportionate amount would be distributed to all
purchasers (thus apportioning the losses proportionately).'
Does this mean that the Developer keeps his 'profit', marketing,
administration, commissions, e.t.c. while investors are left holding
the empty bucket? What incentive do developers have to work things
out with investors if they are not held accountable for what they did
to the money in the accounts?
It seems from the below that RERA seems to understand the issues are
more complicated and there are legal and technical issues involved:
'We understand that RERA has prepared a list of unviable projects,
although none have yet been cancelled. The list has not been made
available to the public. Mr Farouq stated that part of the reason why
no projects have yet been cancelled is that cancellation is both a
legal issue and a technical issue and technical reports have to be
prepared justifying the cancellation.'
I hope RERA/DLD/UAE/Dubai Government are not serious about a blanket
auction regulation for all investors because it will be used by some
(if not most) of the expatriate managers of state owned Developers
against investors to abscond their commitments. These expatriates
will walk away laughing with cash in hand to their country of origin
while Dubai/UAE suffers.
Link: http://www.nortonrose.com/knowledge/publications/2009/pub22169.aspx?page=all&lang=en-gb
> Corruption inquiries total Dh3.6bn <http://www.thenational.ae/apps/pbcs.dll/article?AID=/20090819/NATIONA...>
Ali P
Title Registration Law
Strata Law
Developers’ Guarantee Account Law (Or commonly known as Escrow
Account)
Pre-Registration Law
Property Leasing & Management Law
Brokers Registration By-Law
Mortgage Law
Landlord & Tenant Law
2009 Rent Cap Decree
Document can be downloaded here: http://www.tamimi.com/files/Legal%20Brochures/propertylaw(1).pdf
Ali P
"His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President
and Prime Minister of the UAE and Ruler of Dubai, has created a centre
for amicable settlement of disputes in Dubai.
Law Number 16 of 2009, which establishes the centre, is among six laws
and two decrees Shaikh Mohammed issued on Thursday in his capacity as
the Ruler of Dubai. They become effective from the day of their
promulgation and publication in the official gazette."
http://www.khaleejtimes.com/DisplayArticle09.asp?xfile=data/theuae/2009/September/theuae_September476.xml§ion=theuae
steven
Do you have idea how does this center charge ? what is your opinion
for this new organisation ? when will the center start operation ?
the article clearly shows that before the involvement of the center,
the case can't be sent to court.
B.rgds
Steven
Mo - Investor Harry Dubai
Real estate regulators in Dubai and Ajman have the capacity to approve and
cancel projects in their emirates. (XAVIER WILSON)
By Parag Deulgaonkar on Sunday, September 27, 2009
Investors can file a criminal case against a developer only if the reason
for developer's default is criminal in nature and there is evidence to prove
it, according to a lawyer.
"Investors can file a criminal case against a developer on the basis that it
has not started a project and/or opened an escrow account, but only if the
reason for developer's default is criminal in nature, and there is evidence
to prove it on its face," Ludmila Yamalova, Legal Consultant/Partner, Al
Sayyah Advocates & Legal Consultants, told Emirates Business.
Raza Mithani, Senior Associate, Al Tamimi and Company, Advocates & Legal
Consultants, said: In Dubai, a criminal case may be filed where there is
evidence of fraud. Failure to open an escrow account may, depending on the
circumstances, constitute evidence of fraud."
Tatjana Fuhr, Legal Consultant at Fichte & Co Legal Consultancy and KK
Sarachandra Bose, Partner and Corporate, Commercial and Contract Lawyer, Dar
Al Adalah Advocates & Legal Consultants, agreed that a buyer can file a case
against a developer who has not started the project and collected funds
without opening an escrow account.
However, Ashraf Sayed, Associate, Real Estate, Hadef & Partners, said this
depends on the location of the development and the actions of the developer.
"In general, unless executives of the developer have committed clear
criminal acts, it is unlikely that a criminal case would be taken up by the
police/public prosecutor," he added.
Can investors file a criminal case against a developer who has not started a
project or opened an escrow account?
Mithani: In Dubai a criminal case may be filed where there is evidence of
fraud. Failure to open an escrow account may, depending on the
circumstances, constitute evidence of fraud. Failure to commence
construction in itself is a civil matter, unless there is some evidence of
fraud. However, Article 17 of Law No8 of 2007 provides that if construction
has not commenced within six months of the date that approval was given to
sell off plan without an acceptable excuse, a developer shall be cancelled
from the register. That, of course, would be a regulatory rather than a
criminal matter.
Bose: The buyer can file a case against a developer who has not started the
project and collected funds without opening an escrow account.
Yamalova: Investors can file a criminal case against a developer on the
basis that it has not started a project and/or opened an escrow account, but
only if the reason for the developer's default is criminal in nature and
there is evidence to prove it.
Misrepresentation and cheating are some examples of criminal acts under the
UAE civil code. Similarly, under Dubai Law 8 (escrow law), criminal
sanctions will be imposed where a developer either: 1)"knowingly offers to
sell units in bogus property development" or 2) "embezzles, uses or
squanders payments delivered to him for the purposes of construction of
property developments, and misappropriates such sums."
For a case to be considered criminal there has to be undisputed or clear
evidence to that effect, sufficient to convince the public prosecutor. Thus,
for example, if there is a written statement from a developer himself
admitting that he had never had any right to the property, but yet
represented to the public otherwise, such written evidence may be
sufficient.
More often than not such evidence does not exist, at least at the outset.
Instead, further investigations must be conducted. This arises in cases
where a contract is at issue, therefore, necessitating contract
interpretation. In such cases, a public prosecutor will transfer the case to
the Civil Court. At that point, the Civil Court will lodge an investigation,
often by hiring an expert, to determine the nature of the claim. If at any
point in the process, the court finds a developer's conduct was of a
criminal nature, it will transfer the case back to the prosecutor.
Today, many investors try to file criminal cases first, mainly to use as
leverage. Increasingly, however, the public prosecutor transfers such cases
to the Civil Court. At that point, investors have to start from ground zero
again.
Fuhr: Yes, investors might be able to file a criminal case against the
developer for fraud and embezzlement. Furthermore, for Dubai, the escrow
account law (Art 16 Law No8, 2007) provides a catalogue of elements of
offences that justify a fine of no less than Dh100,000 or penalties of
incarceration to anyone who, for example, embezzles, uses and squanders
payment delivered to him for the purposes of construction of property
developments and misappropriates such payments. Another offence according to
the escrow account law is to carry on property development business without
a licence.
Sayed: This depends on the location of the development and the actions of
the developer. In general, unless executives of the developer have committed
clear criminal acts, it is unlikely that a criminal case would be taken up
by the police/public prosecutor. It should be noted that not all emirates
have escrow laws and certain emirates have its own process for dealing with
developers that are alleged to have delayed a project or failed to establish
an escrow account. For example, in Dubai, Law No8 of 2007 concerning escrow
accounts of real estate developments in the emirate of Dubai (escrow law)
deals with escrow accounts for real estate projects located in Dubai.
Article 7 of the Escrow Law requires an escrow account to be established for
each project; however, in practice there are exceptions. Two other emirates
in the UAE have laws similar to the escrow law, Umm Al Quwain Law No3 of
2007 in respect of security accounts of real estate (security account law)
and Ajman Emiri Decree No12 of 2008 amending Emiri Decree No8 of 2008
(Decree No12). Together the escrow law, the security account law and Decree
No12 (the escrow account laws) contain similar principles and themes.
In the case of the escrow account laws, penalties are set out that allow the
respective competent authorities in the relevant emirates to levy fines
and/or seek an order for terms of imprisonment against those who breach
these laws. If there has been a violation by any party of the escrow account
laws then without prejudice to any punishments stipulated by other
legislation [for example the civil code or the penal code], fines and/or
imprisonment may be imposed. Such breaches cover a wide range of issues,
including embezzlement or use without justification of funds collected for
the construction of real estate projects.
So far as we are aware no other emirates in the UAE currently operate laws
similar to the escrow account laws, although we understand that Abu Dhabi is
close to issuing one. Accordingly, in other emirates, the use to which the
developer can put funds paid in respect of off-plan properties will be
governed by the particulars of the agreements between the parties and
general principles of law. If the agreement has no restriction on the use to
which the developer can put funds paid as a deposit, then the developer may
argue it is able to use those funds for any corporate purposes and the
purchaser's remedies lie in general breach of contract if as a result of
that action the development project is not delivered within the time frames
specified in the agreement.
It is also worth noting that in addition, Article 404 of Federal law No3 of
1987 (Penal Code) generally makes it a criminal offence for a party who has
been given funds on trust for a certain purpose to use those funds for
another purpose, which could be a breach of trust or fraud and there are a
range of criminal penalties for breaching the Penal Code. The ability to
sustain a claim under the Penal Code, however, will be dependent on whether
it was clear from the agreement that the specific funds paid by the
purchasers were to be used solely for the development or whether they would
constitute the general funds of the developer and subsequently the developer
could substitute or replace those funds. Please note that delays concerning
real estate projects are usually a breach of contract issue.
Is it advisable for people/investors to group together and file cases
against a developer? Does such a move help them?
Mithani: While it is possible for investors to group together and file a
complaint with the regulatory agency, it is not possible to bring class
action in the UAE Courts. This contrasts to jurisdictions such as the US
where class actions are a common feature of the legal landscape.
Bose: Such a grouping may help the regulatory agency to handle disputes
collectively rather than addressing it one by one. Investors may benefit as
they can appoint a law firm to represent them before the authority and in
the courts if needed.
Yamalova: Investors acting in concert against the same developer are very
effective. There are limitations, however, as to in what capacity they can
group together.
For example, for the purposes of bringing a legal action in a UAE court,
such collective actions are not allowed. In other words, class action suits
are not within the purview of the UAE legal system, as far as courts are
concerned. Therefore, investors have to file individual lawsuits.
However, tremendous economies of scale can be achieved in the due diligence
necessary and/or helpful to litigate a case. For example, investors can
collectively hire one law firm and/or experts to gather the factual evidence
to be used in the case and share the expense accordingly. Similarly, they
can collect and share research and knowledge among themselves. Also, not to
be underestimated is the leverage groups of investors gain on the developer,
Rera/Land Department, courts and the like. Their collective voice is much
louder and, therefore, harder to ignore. Also the safety in numbers
principle encourages greater number of people to come together. Finally,
investor groups take teeth out of developers' attempt to set individual
investor apart from all of the other investors as being the only one in
default.
Another benefit of investors coming together is that certain judicial forums
allow consolidation of claimants and claims. For example, Dubai
International Arbitration Centre (DIAC) and Dubai International Financial
Centre (DIFC) allow for class action suits. Therefore, those investors whose
contracts provide for either arbitration or DIFC court will have an
additional benefit in joining forces.
Fuhr: Investors can group up and file a complaint with the regulatory
authority asking to cancel the project. The more the majority of investors
in a project signing the complaint, the more likely their complaint will be
heard. Unfortunately if the investors decide to approach a court they will
have to file each case [meaning each single sales and purchase agreement]
separately, which means court fees and lawyer fees for each case.
Sayed: The general legal consensus is that the current UAE legal framework
does not support class actions in the sense prevalent in, for instance, the
US legal system, except in certain types of labour matter. As a result, to
the extent investors are in touch and have disputes involving the same
developer, they might approach real estate regulators on a collective basis
to relay common concerns. In Dubai, one should approach Rera, and in Ajman,
Arra. Groups often form by use of website forums or blogs, or by reference
to a large law firm which acts against developers. Pressure in numbers and
concern about adverse publicity would often make the real estate regulator
look more closely at investors concerns. Although we have seen some levels
of activity by real estate regulators where there are issues of developer
compliance with regulations, directives and policies, if the matter of
concern is a contractual dispute, this is usually referred to the courts or
arbitration bodies in accordance with UAE laws and applicable contracts.
Should a dispute reach the courts, an investor owning numerous units in the
same project, may file one case against the developer. However, the Dubai
Courts usually require an individual investor with more than one unit in the
same real estate project, to pay separate court fees for each unit
particularly where the investor holds separate sale and purchase agreements
for each of the units. Consolidation of cases where arbitration clauses
apply is similarly complicated. In the case of court action, separate
investors can only come together and file one case against the developer if
all the investors are party to one single sale and purchase agreement, a
situation that is uncommon.
How much cost benefit does such a move offer?
Mithani: If the law as amended to allow parties to bring class actions, it
would offer significant benefits not only to individual litigants but also
to the administration of justice. First, it offers the advantage,
particularly in a legal system where there is no system of binding legal
precedent, that consistent decisions will be reached in cases against a
particular developer involving the same issues, such as delay in
construction. Second, it offers costs savings to both claimants and
defendants. This has particular relevance in a situation where there may be
an inequality of resources between the parties, as there may be between a
large developer and a number of small investors. If the investors have the
option of pooling their claims, there is a greater chance of them being on a
level playing field.
On the law as it stands there is nothing to prevent a group of investors
from instructing a single lawyer, which may result in some costs savings and
may provide them with greater leverage but each case will be dealt with
separately by the courts. The costs savings will be less than if the law
permitted class actions.
Bose: Such a move is cost-effective for the following reasons: they can be
represented by one person, preferably a lawyer specialised in property laws,
rather than spending money and time individually; they can appoint one
lawyer so that a reduced fee may be possible.
Yamalova: Collective efforts by investors provide enormous cost benefit.
First, as far as legal and expert fees are concerned, they can share the
expense. Second, any costs incurred in gathering due diligence to litigate a
case can be also split across the board. Even bigger cost benefit could be
achieved if, because of their collective force, investors work out a
settlement with the developer without going to court.
Fuhr: There are no cost benefits since filing a complaint with regulatory
agency is free of charge.
Sayed: As discussed above, group court actions are not currently supported
by the UAE legal system. However, legal costs can be reduced by investors in
common projects appointing the same law firm and joint approaches being made
to the developer and the real estate regulators. It should be noted that the
real estate regulators in Ajman and Dubai have the capacity to approve and
cancel real estate projects in their respective emirate. For instance,
Article 5 of Dubai Law No9 of 2009 provides that "the agency [Rera] may,
following a grounded report, cancel a real estate project, in which case the
developer must return to the purchasers all the amounts pad by them in
accordance with Law No8 of 2007 [the escrow law]". Accordingly, it would
seem that pressure from investor groups would encourage real estate
regulators to investigate disputed projects especially where insubstantial
progress has been made over an extended period of time. Notwithstanding this
power, there has not yet been any officially published decision of the
cancellation of a project in such circumstances by real estate regulators
based on investor pressure. It is likely, however, that a number of projects
must be candidates for such action.
Investor groups should also consider jointly approaching UAE law firms to
receive generic legal advice regarding a particular real estate project.
Although court fees would be payable per case file, investors could seek to
reduce legal fees by filing similar statements of claim in front of the
court and thus achieving economies of scale. It should be noted cases can
differ from one individual case to another even in the same project, for
instance due to different contracts, facts and investment timing.
Ali P
charge IF a settlement is reached. Otherwise they want you to proceed
to court if a settlement cannot be reached. There are 16 articles with
this law that describe the jurisdiction and mechanism for someone else
to post.
http://www.gulfnews.com/nation/Government/10351929.html
Also according to Gulf News the chairman has to define which disputes
can be brought to the center. So work still needs to be done before
the center can be operational. Your guess as to when it would be
operational would be as good as mine.
If property cases can be brought to this center, I think it would be
redundant because RERA currently has the role of doing what the center
would be doing for us; which is trying to resolve complaints against
developers without having to go to court. RERA has a legal department
to handle the complaints and you have read what members are posting
about their experience with RERA.
I also don't see a major incentive for the developer to provide an
amicable solution if forced to come to the center, RERA has the power
over developers/brokers to encourage them to co-operate as they can
delist and fine them. This center does not seem to have any powers of
that sort.
In addition if the center is allocated the same resources as we have
seen the government give to RERA there will be a backlog of cases as
is currently the case with RERA and the court system which is going to
create more frustration.
On the other hand this center would provide a cool off period to re-
assess the situation possibly softening stands on both sides to allow
a compromise.
Also we all know there is a major lack of response/feedback from
developer/brokers. This center could assist by forcing the developer
to come to the center and hear the complaint without having to go to
court and incurring the court fees.
This center also might be a slightly better platfrom to resolve
disputes compared to RERA's machinery which seems to be heavily
influenced by developers
Everyone's case is different but I don't think this center would make
much of a difference to people like me who are stuck with lame duck
developers. There is no incentive for a lame duck developer to come
to an amicable solution and give value for money with the current
ammended laws favouring them.
>
> - Show quoted text -
Ali P
a presenetation at last year's CityScape (2008) that RERA has lawyers
that provide "free" legal assistance to investors so what does the
below mean?
Dubai Land Department (DLD) said it is forming a legal care group
consisting of prominent lawyers and consultants with the objective to
provide free legal aid to investors.
"This initiative has been taken in line with its directions to
encourage work to serve the community to ensure justice to all," said
Mohamed Sultan Thani, Assistant Director of Land Department.
Link: http://www.business24-7.ae/Articles/2009/10/Pages/26102009/10272009_ea8670d1b8e542fc8485f4cda6910a52.aspx
Sandra van Zyl
Ali P
time last year.
You are correct that almost all law firms in Dubai will ask for an
upfront payment without reviewing anything. Part of the problem could
be that they are so busy with existing clients they cannot afford to
spend time that could be otherwise billed by reviewing disputes with
new clients.
If you go through a referral from someone they know, you may get a
different outcome. There is one law firm on that RERA's list of
lawyers that was also on a list given to me by my country's trade
commissioner. When I had contacted this firm last year they did not
charge anything to review and give guidance for my problem.
There are a lot of people seeing the litigious mode of the market as a
good business opportunity. Even my developer/manager who is (or was?)
a partner with one of the ruling families for my project is now
offering solicitor services. This is an excerpt from their updated
website:
"We have grown to diversify beyond construction, and now cover many
aspects of the real estate business. In fact, XXXXX today provides
customers with complete property management solutions, including
solicitor services."
This influx of new participants who are offering legal advice could be
why DLD/RERA is trying to publicly promote the setup of a free legal
aid service for investors.
But the problem is that they already have a legal department and
complaints procedure for grievances to be heard so I am not sure why
this legal care service would be a new concept for investors.
Maybe this public announcement of a legal care service is a way to
beef up their existing legal department or complement it without
admitting publicly they are overwhelmed. I'm not sure what their plan
is but anything that increases the resources available to them should
help us a bit more I guess.
Fuadsmile
ashish...@gmail.com
Anyone has any updates on badrah phase 1, I have units there..1, 2 bhk flats.
Is this project cancelled?
Pls call me on 0506468792 or fwd me an email on akhubc...@gmail.com
Thnks
Sent from my BlackBerry® wireless device
Ali P
by DLD in conjunction with a few local and international law firms. It
is supposed to offer free legal assistance to investors with 'genuine'
real estate issues. There is no mention of the criteria they would
use to categorize genuine vs. non-genuine issues.
http://gulfnews.com/business/property/people-caught-in-real-estate-bind-can-get-free-legal-help-1.522572
Comments by CEO of RERA to GN:
' "We at Rera [Dubai's Real Estate Regulatory Authority] have been
helping and protecting investors' [real estate] rights and it's a
great move to see the [sector] taking some social responsibility...
and from what we see, most of the cases are misunderstandings, not
disputes. Once the two parties are set together and start
communicating they will solve problems and reach a [conclusion],"
Marwan Bin Galita, chief executive of Rera, told Gulf News.'
AMEinfo mention the law firms involved as Al Tamimi, Norton Rose,
Trowers and Hamlins, Lawyerpoint, Clyde and Co, Afridi and Angell and
Hadef Al Daheri and Associates
http://www.ameinfo.com/214562.html
Comments regarding the meeting with the above lawyers by Director
General of DLD as reported by AME:
'Mohammed Sultan Thani added, "Now, no one is prevented from pursuing
their rights merely because of the possibility they might be priced
out of the legal system. The professionals who attended the meeting
were extremely positive about this initiative and are being very
generous in committing themselves to it and in volunteering their
time."
"As professionals they recognize their responsibility to the wider
interests of the community and to ensuring that it is not merely
perceived as fair but that in actual fact it acts in a way which is
fair to everyone," he stated.'
>
> > > - Show quoted text -- Hide quoted text -
simo...@gmail.com
-----Original Message-----
From: Ali P <apir...@gmail.com>
Date: Mon, 2 Nov 2009 21:59:44
To: Dubai Property Investors<dubai-proper...@googlegroups.com>
Subject: [Dubai Property Investors] Re: Legal Articles
Investor 101
Dubai Good News – Dubai property dispute victims to get free legal advice – Let`s Hope that this is not again only a promise
Posted by 7starsdubai on 2009/11/03
Dubai Land Department on Monday announced a new initiative to introduce a free legal service to support home owners involved in real estate-related court cases.
The announcement follows a meeting between senior Land Department officials and representatives of law firms to finalise details of the move.
The Land Department said an agreement had been signed which would see the law firms become part of a new Legal Care Group.
The group will bring together senior lawyers, professional firms and consultants to offer free legal assistance to members of the public with “genuine real estate issues” who might otherwise be dissuaded from taking action because of the prohibitive cost of fees, the Land Department said in a statement.
Mohammed Sultan Thani, assistant director general of the Dubai Land Department, said: “The objective of this initiative is not merely to meet a need but to ensure fairness and justice is available to anyone who might have a concern which involves property, no matter their circumstances.
“This reflects the government’s commitment to ensuring there is in place a comprehensive equitable system of legalizing ownership and property transactions.”
He added: “Now, no one is prevented from pursuing their rights merely because of the possibility they might be priced out of the legal system.”
Richard Green, head of research at CB Richard Ellis Middle East, said: “The offer of free legal advice is another step in the right direction. Overall confidence in the legal dispute system has been somewhat low due to a time lag in addressing the current case backlog.
“This announcement will go some way to renewing faith in the system as well as providing confidence to individual investors facing financial difficulties in their disputes against developers.
“Overall this is seen as another positive advancement for the Dubai market.”
In August it was reported that property dispute cases that were originally submitted to the Real Estate Regulatory Agency (Rera) and Dubai Courts are now being dealt with by Dubai’s new Property Court.
The new court, which started operations in October, was set up under the First Instance Court to deal exclusively with property-related cases.
Posted in Dubai, Dubai Government, Dubai developer, Dubai fraud, Immobilen Probleme Dubai, Lawyer Dubai, Rera property laws Dubai | Tagged: Dubai, Dubai Land Department, Lawyer Dubai Real Estate, Property scandal Dubai, RERA Dubai | Leave a Comment »
> Date: Mon, 2 Nov 2009 21:59:44 -0800
> Subject: [Dubai Property Investors] Re: Legal Articles
Ali P
impartial via the media to increase Foreign Direct Investments but in
the long term, in order to restore confidence, I feel that they will
have to make all investors truly believe what they are saying. I
don't think this has happened yet although they seem to be trying to
reach this goal.
If they completely lose their credibility by failing at everything
they annouce they will permanently lose future investments from those
who are monitoring the situation. Albeit they may still have not so
significant investments being made by the well connected investor or
foreign investors who get lured by the Dubai image verbatim (although
this is much more difficult now).
What does your experience in this market indicate? Does the below
ramp up in cancellation notices mean they would just prefer to keep
investors' money rather than solving the underlying problems or do the
investors receiving the notices have what they would categorize as non
genuine issues?
This is an excerpt from an article in 24/7:
' "Now we have started to see official notices of cancellations from
DLD. Developers are more determined to cancel contracts, which, in
turn, allows them to keep investors' capital," said Ludmila Yamalova,
Partner, Al Sayyah Advocates & Legal Consultants.
An aggrieved investor said DLD and Real Estate Regulatory Agency
should also initiate action against developers who fail to fulfill
their part of the commitment. '
Link: http://www.business24-7.ae/articles/2009/11/pages/03112009/11042009_49dc5f1196064eda92ef5bcfce73f9c5.aspx
On Nov 3, 9:42 am, simoth...@gmail.com wrote:
> What a good way of making the world believe it .you go to RERA or Land Department or property court you can immediately make out that they are interested only to look after the developers. Investor or end user you have no rights no say and if you insist than go to court spend a couple of thousands more and wait probably six months to one year even if your issue is very simple and straight. its all biased I pray for those who are pursuing but I don't think you will benefit.this is all cooked up and to attract further investments but we have burnt our fingers
> Empower your Business with BlackBerry® and Mobile Solutions from Etisalat
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>
>
> -----Original Message-----
> From: Ali P <apirb...@gmail.com>
> Date: Mon, 2 Nov 2009 21:59:44
> To: Dubai Property Investors<dubai-proper...@googlegroups.com>
> Subject: [Dubai Property Investors] Re: Legal Articles
>
> Article in Gulf News regarding the Legal Care Group being introduced
> by DLD in conjunction with a few local and international law firms. It
> is supposed to offer free legal assistance to investors with 'genuine'
> real estate issues. There is no mention of the criteria they would
> use to categorize genuine vs. non-genuine issues.
>