Dubai court orders investment company to pay Dhs441,000 to property management firm

The Dubai Commercial Court has ruled that an investment company must pay Dhs441,000 to a property management firm. This sum accounts for unpaid fees related to property management and leasing services.

Additionally, the investment company is required to pay a 5% annual interest for delays, calculated from the claim date until the payment is completed, as well as cover legal and attorney fees. However, the court dismissed the real estate firm's request to hold a bank jointly responsible for the payment along with the company.

The dispute originated from a service contract established in June 2021 between the parties for managing and leasing a property portfolio. As per this agreement, the real estate firm was responsible for property management, leasing units, and rent collection, in return for specified fees and commissions.

The parties later entered a tripartite agreement involving a bank acting as a lender under credit facilities provided to the property-owning company. The real estate firm claimed Dhs661,500, asserting that it had honored its contractual duties, while the company owning the properties had not fulfilled the full payment obligations.

The court appointed an accounting expert to review the contractual relationship, invoices, and associated documents. The expert concluded that the plaintiff company had indeed fulfilled its management and leasing services as agreed and was entitled to the amounts invoiced. After accounting for a previously paid sum, the expert calculated the remaining balance as Dhs441,000.

The court accepted these findings, considering them to be based on proper accounting principles and well-supported by the case records. It was also noted that the owning company failed to prove payment of the outstanding balance.

The court confirmed that the contract is binding, that the fulfillment of agreed services warrants payment, and that non-payment by one party allows the other to claim what is due.

Additionally, the court dismissed the request to hold the bank jointly responsible with the owning company for the amount owed. The tripartite agreement included no explicit terms requiring the bank to cover the property manager's fees, nor did it establish any obligation on the bank regarding this claim.

The court ordered the owning company to pay Dhs441,000, along with interest at a rate of 5% per annum from the date of the claim until full payment, as well as covering legal costs and attorney's fees.