Dubai court orders 2 firms to pay Dhs3.4m in unpaid installments for 53 vehicles

The Dubai Commercial Court has ordered two companies to jointly pay approximately Dhs3.4 million in unpaid installments for 53 vehicles, after cheques were returned for insufficient funds and direct debit payments ceased. The ruling includes annual interest of 5% from the date the claim was filed until full settlement, along with legal fees, court costs, and Dhs1,000 in attorney’s fees.

The dispute arose from five contracts between a car dealership and a vehicle rental company for the purchase of 53 vehicles on an installment basis. The agreements, entered into between August 2024 and February 2025, had a total value of nearly Dhs5 million. A second company signed the contracts as guarantor for the purchasing company’s financial obligations.

According to the case files, the purchasing company failed to make the agreed installment payments consistently. Thirteen cheques issued to cover the amounts due were returned for insufficient funds, and direct debit payments failed even after the debt was rescheduled. The dealership consequently filed a lawsuit seeking recovery of the outstanding balance of approximately Dhs3.4 million, plus legal interest.

The court appointed am expert to examine the contractual relationship, review the agreements and supporting documents, verify payments made, and determine the outstanding balance. The expert’s report calculated the purchasing company’s unpaid debt at Dhs3.427 million and confirmed that the second company had signed the contracts as guarantor.

In its reasoning, the court accepted the expert’s findings, noting that they were based on technical criteria and documents contained in the case file. It ruled that the purchasing company’s failure to pay the installments had triggered a contractual clause making the entire outstanding debt immediately due. The second company was held liable within the scope of its guarantee.

The court therefore ordered both companies, jointly and severally, to pay the outstanding amount, together with annual interest of 5% from the filing date until full payment. It also ordered them to pay legal fees and court costs, plus Dhs1,000 in attorney’s fees, and dismissed all other claims.