Buyer penalised Dhs1.54m after failing to complete Dubai property purchase

A property owner in Al Wasl area, Dubai, filed a lawsuit demanding the annulment of a residential unit sale contract and obliging the purchaser to pay the deposit amount, after she  failed to complete the purchase procedures and did not pay the remaining agreed price.

The Dubai Primary Real Estate Court annulled the sale contract and obliged the defendant to pay the plaintiff Dhs1,540,000, as well as fees, expenses, and lawyer's fees.

The plaintiff explained that he agreed with a woman to buy the residential unit and paid a deposit of Dhs2.2 million, with the remaining price to be completely paid upon transfer of ownership.

The woman allegedly gave him a cheque of the deposit amount as confirmation of her commitment to the contract, but she did not adhere to the specified deadline for completing the deal and requested an extension, claiming a delay in issuing her Emirates ID and some administrative approvals, even though these conditions were not stipulated in the contract.

The court indicated that the appellant responded to the extension request and granted her an additional period, but she did not complete the procedures or pay the remaining price during that period, nor did she provide any evidence of reasons beyond her control preventing execution.

It also became clear to the court from the submitted documents, including the sale contract, title deed, and correspondence between the parties, that the seller had fulfilled all his obligations, while the purchaser failed to fulfill hers and did not attend the court sessions despite being legally notified.

The court affirmed that the sale contract included explicit conditions stating that in the event of the purchaser's breach of her obligations, the seller has the right to annul the contract and retain the earnest money.

The additional conditions also stipulated the distribution of the earnest money at 70% for the seller and 30% for the real estate broker.

The court concluded that the purchaser failed to complete the deal without justification, which results in the annulment of the contract and obliging her to pay the due percentage of the earnest money.