Table of Contents
In recent times, the real estate market in Dubai has witnessed significant prosperity, attributed to the surge and expansion of real estate projects within the city. Today, Dubai’s real estate market stands as a global attraction for investors, contributing substantially to the economic sector. As the rental sector constitutes around half of the real estate sector in the UAE, it serves as a foundational element for the economy, underscoring its essential role (The accelerating of growth of the real estate market in the Gulf countries in 2023, 2023).
To establish an effective and fair housing and real estate system, targeted regulations and controls have become imperative. These regulations aim to foster balanced development and sustainable solutions to industry challenges (Al-Saedi & Abbas, 2023; Sanna, 2023; Abdelgalil, 2005), thereby safeguarding the rights of all stakeholders involved. Recognizing the pivotal role played by the real estate sector in Dubai’s economic growth, the local legislature has taken proactive measures to ensure transparency in all transactions within the industry. This approach aims to uphold the rights of all stakeholders, fostering a climate of trust and confidence between them and the real estate sector in Dubai (Alsaad & Lazim, 2023; Alblooshi, Mohamed & Yusr, 2023).
In pursuit of a comprehensive legal framework for determining real estate rental values and related circumstances affecting such determinations, Decree No. 42 of 2013 was issued (Matly & Dillon, 2007). However, the Emirate’s legislature continued its commitment to developing the legal regulation of the real estate sector. Consequently, Law No. 33 of 2008 was enacted, amending various articles of Law No. 26 of 2007. This amendment focused on refining the legal aspects of the landlord-tenant relationship within the Emirate of Dubai.
Legal Procedures and Jurisdiction of the Rental Disputes Center in Dubai
The dynamics between tenants and property owners in Dubai are intricately governed by Law No. 33 of 2008 concerning the relationship between property owners and tenants in the Emirate. One of the significant outcomes of this legal framework is the establishment of the Rental Dispute Settlement Center (RDSC) through Decree No. 26 of 2013. This center serves as a pivotal entity for reconciling parties involved in rental disputes, aiming to achieve an amicable resolution or, alternatively, provide a final ruling enforceable through the RDSC. This article delves into the comprehensive procedures followed by the RDSC in Dubai.
Transition from Rental Committee to Rental Dispute Resolution Center
In late 2013, the Rental Dispute Resolution Center (RDSC) replaced the Dubai Rental Committee, which operated as a judicial committee without the inclusion of judges in its structure. Decisions made by the committee, based on majority agreement, were deemed final and not subject to appeal. The transition to RDSC was a strategic move to introduce a more efficient and streamlined judicial system tailored to address rental disputes promptly. The RDSC comprises five distinct departments: the Central Support Department, the Conciliation Department, the Trial Chamber, the Appeals Chamber, and the Implementation Department. Each department has specific roles and responsibilities within the overall framework.
Jurisdiction of the Rental Disputes Settlement Center
The jurisdiction of the RDSC spans across:
A) Rental Disputes in the Emirate of Dubai: The RDSC has authority over all rental disputes arising within the Emirate of Dubai, with exceptions for disputes related to financial lease contracts and long-term lease contracts.
B) Rental Disputes within Free Zones: The RDSC can handle rental disputes within free zones, unless these zones fall under the jurisdiction of special judicial committees or courts, such as the Dubai International Financial Centre.
Dispute Resolution Process of Rental Disputes Center
- Negotiation and Conciliation: In the event of a rental dispute, the involved parties are encouraged to negotiate and reach an amicable settlement. Should negotiations fail, the matter is referred to the Arbitration Department within the RDSC. This department intervenes with the aim of settling the dispute amicably within 15 days, simplifying the resolution process.
- Filing a Lawsuit: If negotiations and conciliation efforts prove unsuccessful, the parties may file a lawsuit in the First Instance Chamber of the RDSC. Here, the legal process begins to address the dispute in a more formal manner.
Appeals Process of Rental Disputes Center
In the event that an amicable settlement cannot be reached, and the dispute escalates to the First Instance Chamber, parties have the right to file an appeal if the rental amount exceeds 100,000 UAE dirhams. Special circumstances under which an appeal can be filed are outlined in Article 17 of Law No. 26 of 2013, including:
A – Eviction Ruling: If an eviction ruling is issued.
B – Violation of Jurisdiction Rules: If the ruling is issued in violation of the rules of jurisdiction.
C – Exceeding or Ignoring Requests: If the ruling rules something that the parties did not request, or more than they requested, or ignores some of the requests.
D – Judgment Against Unrepresented Party: If the judgment was issued against a person who was not properly represented in the case or if there was an invalidity in the declaration.
E – Forgery or False Testimony: If the ruling was based on forged documents or false testimony.
F – Concealment of Evidence: If one of the parties concealed evidence or documents that would have altered the ruling.
In the absence of these circumstances, the ruling of the first instance becomes final and not subject to appeal. If the claim amount exceeds AED 100,000, parties have the right to file an appeal within 15 days from the date of the first instance ruling. However, the decision of the Appeals Chamber is deemed final and binding, and it is imposed by the Enforcement Department.
The UAE’s rental sector, constituting a substantial portion of the real estate domain, plays a fundamental role in the economy. Recognizing its significance, the Emirate of Dubai implemented measures to enhance transparency and protect the rights of stakeholders. The establishment of the Rental Dispute Center Dubai (RDCA) reflects a commitment to resolving rental disputes and fostering a secure environment for investors and rental parties alike. This article employs a social-legal research methodology, employing an analytical and critical approach.
Findings indicate that the RDCA has successfully streamlined and expedited the resolution of rental disputes, distinguishing itself from the traditional judicial system. Its contribution extends to safeguarding the rights of all involved parties, thereby promoting growth in the real estate sector. However, the article suggests a review of certain legal provisions that may pose challenges to the principle of judicial independence, ensuring the full realization of the RDCA’s intended objectives.
The rental sector in the UAE, constituting approximately half of the real estate sector, is a foundational element for the region’s economy and a fundamental pillar in the economic sector at large (The accelerating growth of the real estate market in the Gulf countries in 2023, 2023). Establishing an effective and equitable housing and real estate system necessitates targeted regulations and controls. These measures are essential for fostering balanced development and sustainable solutions to industry challenges (Al-Saedi & Abbas, 2023; Sanna, 2023; Abdelgalil, 2005), ultimately safeguarding the rights of all stakeholders involved.
Given the pivotal role of the real estate sector in contributing to the economic growth of the Emirate of Dubai, the local legislature has proactively intervened to ensure transparency in industry transactions. This approach aims to uphold the rights of all stakeholders, cultivating an environment of trust and confidence in the Dubai real estate sector (Alsaad & Lazim, 2023; Alblooshi, Mohamed & Yusr, 2023).
Legislature
The legislature’s involvement in regulating the landlord-tenant relationship in Dubai is evident in the enactment of Act No. 26 of 2007. This legislation emphasizes the importance of registering lease agreements with the Real Estate Regulatory Authority. It also delineates the lease duration and the corresponding rental fee payable by the tenant to the landlord. The law further outlines the respective obligations of both parties and the conditions under which the landlord may lawfully request the tenant to vacate the property.
However, reflecting the legislator’s commitment to advancing the legal regulation of the real estate sector, Law No. 33 of 2008 was enacted. This law amended several articles of Law No. 2007, specifically addressing the rental relationship. The revised law defines a rent lease contract as an agreement in which the lessor enables the tenant to use the property for a specific purpose and period in exchange for a set rent (Article 2, 2008).
It is essential to note that the UAE legislator, in Article No. 742 of the Civil Transactions Law, defines the lease contract more broadly, encompassing real estate and non-real estate throughout the United Arab Emirates. In contrast, Law No. 33 of 2008’s definition is specific to real estate in the Emirate of Dubai, marking a distinction in its application scope (Al-Shuwaihi, 2020).
To establish a comprehensive framework for determining real estate rental values and addressing factors that may affect this determination, the local legislature issued Decree No. 42 of 2013 within the Emirate of Dubai (Matly & Dillon, 2007).
Understanding the procedures of the Rental Disputes Center in Dubai is crucial for both landlords and tenants navigating the complex landscape of rental disputes. The RDSC’s evolution from the Rental Committee signifies a commitment to enhancing efficiency and ensuring fair and enforceable resolutions. With its well-defined jurisdiction and multi-step dispute resolution process, the RDSC plays a pivotal role in maintaining a balanced and harmonious rental environment in the Emirate of Dubai.
The RDCA’s Competencies and Operational Procedures
Decree No. 26 of 2013 meticulously delineated the specific tasks and competencies entrusted to the Rental Disputes Settlement Center (RDCA), along with the procedures guiding their execution. Article 6 of the decree succinctly outlines the responsibilities of the RDCA, while also specifying scenarios where it cannot exercise its competencies.
The RDCA is mandated with the following responsibilities:
- Resolving all rental disputes between landlords and tenants in existing real estate within the Emirate or free zones, encompassing counterclaims and requests for temporary or urgent procedures submitted by either party to the lease.
- Adjudicating appeals against decisions and judgments appealable under the provisions of the Decree and related regulations.
- Enforcing decisions and judgments issued by the center in rental disputes within its jurisdiction.
Article 6 of the decree enumerates cases in which the RDCA cannot consider disputes. These include rental disputes within free zones governed by their judicial committees or specialized courts, disputes arising from financial lease contracts, and disputes arising from long-term lease contracts regulated by Law No. 7 of 2006.
Operational Mechanisms of the RDCA Under Decree No. 26 of 2013
This article aims to elucidate how the RDCA effectively exercises its competencies, primarily through its judicial sector. The judicial sector comprises various departments, each assigned specific competencies to facilitate the resolution of rental disputes in Dubai. This includes the Department of Conciliation and Reconciliation, the Primary Circuit, the Appellate Circuit, and the Department of Execution of Judgments.
- Conciliation and Reconciliation Department: As per the regulations set by the head of the RDCA, this department focuses on conducting amicable settlements of rental disputes. It invites involved parties or their representatives, offering reconciliation options to foster agreement. The goal is to achieve a peaceful resolution within 15 days, extendable if necessary, by a decision of the overseeing judge (Article 10, 2013).
- Primary Circuit: Examining Article 13 of the decree reveals that the primary circuit functions through committees established by the RDCA head. Each committee, led by a judge, comprises two members with legal and real estate expertise, specializing in adjudicating rental disputes outlined in Article 6. Committees can be allocated based on the nature of the lawsuit, location of the leased property, or the type of rental dispute (Article 13, 2013).
- Appellate Department: Article 14 highlights that the Appellate Circuit’s authority is exercised through committees, each comprising two judges and one individual with real estate specialization. The head of the committee must be a judge. This committee considers appeals against decisions and judgments issued by the Primary Circuit. Appellate Division decisions are binding and cannot be appealed, ensuring adherence to the center’s established procedures and principles.
Article 18 outlines the conditions for accepting an appeal request, requiring submission within 15 days from the Primary Circuit’s decision date. The timeframe may be adjusted based on specific circumstances. Notably, departments must decide on cases within 30 days from the case file referral date, with possible extensions under predefined controls (Article 16, 2013).
In essence, the RDCA operates as a legal entity within the Dubai Department of Property and Lands, overseen by a judge. Its various departments play integral roles in ensuring fair and efficient resolution of rental disputes in Dubai.
Nevertheless, it is essential to recognize that the center distinguishes itself from federal courts in two primary aspects. Firstly, concerning the level of litigation, the center comprises two levels—namely, the Primary Circuit and the Appellate Circuit. In contrast, the UAE courts involve three levels of litigation, consisting of the Primary Court, the Court of Appeal, and the Court of Cassation (Elsheshtawy, 2019).
The second distinguishing factor pertains to the timelines for filing appeals against court judgments. Notably, an individual convicted by the Primary Circuit must file an appeal within 15 days of being notified of the verdict. This timeframe contrasts with the 30-day appeal period provided for by the federal courts’ Court of Appeal, commencing from the date of the Primary Court’s verdict announcement (Article 159, 2018).
Department of Judgment Execution of Rental Disputes Center
In accordance with Article 21 of the 2013 decree, all final judgments rendered by the Primary Circuit and Appellate Circuit shall be enforced by the Department of Execution of Judgments, a component of the RDCA. However, the head of the RDCA is authorized to seek support from the Execution Department of Dubai Courts in executing judgments issued by the Centre (Jadalhaq, 2017).
Due to various contributing factors, the real estate industry in the Emirate of Dubai has experienced significant and rapid growth in recent times, becoming a crucial aspect of the local economy’s prosperity. Consequently, the Emirate government has taken a keen interest in fostering the development of this industry through various means, such as enacting regulations to govern its operations and safeguard the rights of parties involved, promoting confidence in the real estate sector.
Regarding rental arrangements, the law defines rent as a lease agreement, wherein the landlord agrees to enable the tenant to use the property for a specific purpose and time in exchange for a specified rental fee. Thus, the contract constitutes the basis for the tenant’s legal right to use and enjoy the property (Javeed, 2021).
However, the Dubai government did not limit itself to enacting laws regulating the real estate sector but established a specialized center to resolve disputes between landlords and tenants. This initiative was realized through the issuance of RDCA Decree No. 26 of 2013, replacing the Judicial Committee formed under Decree No. 2 of 1993. The primary goal was to achieve social and economic stability for all those involved in the real estate rental sector and related sectors supporting sustainable development in the Emirate. The center comprises two distinct sectors—the administrative sector and the judicial sector.
The judicial sector includes the Department of Conciliation and Reconciliation, the Primary Circuit, the Appellate Circuit, and the Department of Execution of Judgments. The administrative sector consists of several organizational units assigned tasks to provide technical and administrative support to the judicial sector.
The center is led by a judge whose rank is not lower than that of an appeals judge, appointed by a decision of the Ruler of Dubai. The head of the center is responsible for supervising the work of the judicial sector in the center. Additionally, the Center has a Secretary-General appointed by a decision of the Director-General of the Department of Property and Lands in which the Center is located.
The Secretary-General supervises the work of the administrative sector of the Center and performs other tasks assigned or delegated by the Head of the Center. Concerning the financial resources of the Center, Article 27 of the decree indicates that the Center’s financial resources come from the support provided for the Center in the budget of the Property and Land Department or from the fees for services charged by the Center for lawsuits, requests, and services it provides.
However, the article suggests that the legislator should consider the principle of the independence of the judiciary in both administrative and financial aspects. Judicial independence guarantees that judicial bodies perform their tasks without interference or influence. To achieve this, the article proposes the necessity of amending Article 9 of the decree, suggesting that the appointment of the manager of the administrative sector be through the Judicial Council. Furthermore, it emphasizes the need to amend Article 27 of the decree, proposing that the center’s budget should be separate from the budget of the Property and Land Department.
Article 6 of the decree outlines the jurisdiction of the center, which is limited to matters related to:
- Resolving rental disputes arising between landlords and tenants of existing real estate in the Emirate or free zones, including any counterclaims and requests for temporary or urgent procedures submitted by either party to the lease.
- Adjudicating appeals against decisions and judgments that may be appealed under the provisions of the Decree.
- Implementing the regulations and decisions issued pursuant to the Decree, as well as executing the decisions and judgments issued by the center in the rental disputes over which it holds jurisdiction.
Understanding the procedures of the Rental Disputes Center in Dubai is crucial for both landlords and tenants navigating the complex landscape of rental disputes. The RDSC’s evolution from the Rental Committee signifies a commitment to enhancing efficiency and ensuring fair and enforceable resolutions. With its well-defined jurisdiction and multi-step dispute resolution process, the RDSC plays a pivotal role in maintaining a balanced and harmonious rental environment in the Emirate of Dubai.