Dubai court obliges real estate firm to return Dhs1.267m to plot purchasers

Dubai Real Estate Court ordered a real estate development company to refund Dhs1,267,000 to two buyers, whom the company had sold a plot of land to build a residential villa but the company failed to deliver the land.

The court also rejected the inclusion of a second company in the case, as it provided evidence of returning the amount it had received from the buyers.

According to the case documents, the plaintiffs signed a land sale contract to build a residential villa, purchasing a plot from the appellee company for a total of Dhs1,334,000 and on the same date, the second appellee company signed a civil works management services contract with the plaintiffs, committing to construct a villa on the plot. Payments were agreed to be made in three installments and the first company received Dhs1,467,000 from the plaintiffs, including Dhs1,334,000 for the land and Dhs133,000 as the first installment for construction costs.

The first company allegedly failed to deliver the land to the plaintiffs and both companies signed a termination agreement for the sale contract and the services management contract, with the first company pledging to refund the amount received from the plaintiffs, but it did not fulfill this obligation.

The court noted that the first company did not provide evidence of clearing its debt or returning the amount received, having transferred only Dhs66,000, and thus, it still owes Dhs1,267,000.

The court also rejected the inclusion of the second company in the case, as it provided proof of returning the amount it had received from the plaintiffs.

Dr Alaa Nasr, the legal representative of the plaintiffs, stated that Article 246 of the Civil Transactions Law obligates contracting parties to fulfill the terms of the contract, and the contractor must execute the contract as agreed.