Court Annuls Real Estate Deal, Orders Compensation

A Dubai Real Estate Court has overturned a residential sale contract due to the buyer's failure to meet payment obligations. The court ordered the unit's re-registration under the selling company's name. The buyer is also required to pay Dh250,000 in compensation for damages and lost profits incurred during the payment delay.

The dispute originated from a 2019 agreement where the company sold a completed residential unit for Dh2.386 million. The contract stipulated a 10% down payment and 21 installments. Despite the unit being registered in the buyer's name in December 2019, the buyer defaulted on payments.

The company presented the contract, payment records, a completion certificate, title deed, and an expert report to the court, demonstrating its fulfillment of the agreement. The court affirmed the contract's binding nature, emphasizing the buyer's obligation to pay on time. While the penalty clause became void upon termination, the court granted the seller the right to compensation, setting the amount at Dh250,000.

Legal counsel cited federal civil law, which allows sellers to retain ownership until full payment, even after unit handover.