Dubai’s Ruler Establishes New Rental Dispute Centre

Dubai’s ruler Sheikh Mohammed bin Rashid Al Maktoum has issued a decree to establish a new rental disputes settlement centre in the emirate as part of Dubai’s Land Department.

The centre will aim to “enhance legal procedures that facilitate the settlement of rental disputes”, reported official news agency WAM.

Under the new mandate, the centre will deal with the settlement of all rental disputes for properties and free zones within the emirate (unless such disputes are assigned to judicial committees or special courts for the purposes of rent dispute settlement), lawsuits arising from such disputes, requests for urgent action by either of the disputing parties and appeals on rulings and sentences which may be challenged for appeal.

However, the centre will not look into the settlement of rental disputes arising from financial leasing contracts and those arising from long-term rent contracts that fall under the provisions of Law No. 7 of 2006 concerning property registration in Dubai.

The chairman of the Dubai Judicial Council is authorised to issue necessary decisions to implement the provisions of the decree, said WAM. The centre, its committees and departments will be headed by judges, and members will include legal professionals and experts. Decisions and rulings are to be issued on behalf of Sheikh Mohammed unanimously or by a majority vote.

The centre’s legal section will include departments for conciliation and mediation, trial chamber, appeals chamber and a department tasked with implementing sentences and rulings. Its administrative section will include organisational units to provide technical and administrative support to the legal section.

The decree will be published in the official gazette and is effective after 60 days from its date of publication, said WAM.

Dubai has been beefing up laws to better regulate its real estate sector as the market recovers from a crash in 2009.

In the past twelve months, residential prices in Dubai have increased by 38 per cent for apartments and 24 per cent for villas while rents have risen 20 per cent and 17 per cent respectively, according to a research report by Standard Chartered Bank.

In its report, the bank said that Dubai’s property market has particularly benefitted from the two new property-related laws drafted by the Dubai Land Department: the Investor Protection Law and the Code of Corporate Governance for Developers.

“This commitment towards improving and strengthening corporate governance practices by protecting property rights has helped gain new investors and maintain existing ones. Stakeholders such as home-owners and tenants have regained confidence in the real estate sector, as reflected in the recovery of market prices,” said Standard Chartered.

In the next two years, the emirate is expected to draft seven new laws to regulate the market and maintain property values.

The laws with introduce controls to limit the fast re-sale of property and focus on setting thresholds for premiums and percentage of completion of projects before they can be sold, stated the report.