Dubai court cancels villa contract, orders Dhs44,000 refund

The Dubai Commercial Court has decided to terminate a contracting agreement for the maintenance of a residential villa.

The ruling includes the return of Dhs34,000 along with financial compensation of Dhs10,000. This decision follows evidence that the contracting company failed to fulfill its contractual obligations and did not commence the agreed-upon work within the stipulated timeframe.

The case revolves around a contracting agreement aimed at completing the construction and maintenance of a residential villa within a designated timeframe. Despite the project owner paying the agreed-upon advance payment, the company failed to commence any of the work outlined in the contract. This led to both financial and emotional hardships, including the necessity of residing in temporary accommodations and eventually hiring a different contractor to complete the project.

The court designated a technical expert to assess the dispute. In the report provided, the expert determined that the company was responsible for breaching its contractual obligations, primarily due to its failure to execute the work or meet the agreed-upon timeline. Conversely, it was not established that the other party violated any significant obligations.

The report also included a settlement of accounts between the two parties, specifying the amounts owed as a consequence of the incomplete execution of work.

After reviewing the report and evaluating arguments presented by both sides, the court determined that the contracting company had violated its obligations under the contract, warranting its termination. Furthermore, the court mandated the restoration of circumstances to their pre-contractual state, including reimbursing excess payments received for work that was not carried out.

The court also acknowledged that the project owner had suffered clear material and moral damages directly resulting from the breach of contract.

It assessed the compensation for these damages at Dhs10,000. However, the court dismissed the claim for a late penalty since the work's completion was not achieved despite delays. Ultimately, the ruling confirmed contract termination, required repayment of the outstanding amount, and ordered the contractor to pay compensation, while also holding them responsible for covering all fees, expenses, and attorney costs.