The real estate market is one of the largest sectors in the UAE and around the globe. The stakes are high and huge sums of money are involved particularly for luxury projects. Investors and individuals put all in to get the best possible deal. In an industry this big, and with so many players involved disputes are bound to happen. While most are solved between the concerned parties, others are taken to court – also referred to as real estate litigation.
We will take a closer look at some common real estate litigation causes along with some effective ways to avoid them.
What is Real Estate Litigation?
Real estate litigation is a course of action whereby one party takes another party over a property dispute. When parties involved in a real estate deal can’t come to an agreement, the matter is taken to court. The court then oversees the case and passes its verdict based on the findings.
The litigation doesn’t necessarily just happen between landlords and tenants. All concerned parties such as real estate agents, brokers, property managers, etc can all become a part of the dispute. People can easily open a case for any issue such as filing a rental dispute in Dubai or any other Emirate.
However, the procedure comes with a fee and may also take time. Therefore, concerned parties usually try to arrange a settlement outside of court with litigation being the last resort for unsorted matters.
Real Estate Litigation Causes
The UAE has specialised its judicial system with initiatives like the rental dispute settlement centre in Dubai among many more. These help concerned parties resolve disputes as per Emirati law and regulations.
Let’s take a look at some residential and commercial real estate litigation causes and some effective ways to avoid them in the first place.
BREACH OF CONTRACT
Much like many other businesses, property dealings and agreed terms are documented in the form of contracts. These contracts detail the conditions agreed upon by all concerned parties. However, if any of the parties breaches the contract, real estate litigation may be the last option.
For instance, a property seller refusing to hand over the house furniture which was a term in the contract. This will be a breach of contract and the buyer reserves the right to take the matter to court.
To avoid such disputes, it is a viable option to hire a real estate attorney. They come with sound knowledge of the field and can review the contract for you. A real estate attorney can point out things from a legal perspective – all to help you make a rational decision.
Moreover, individuals should also be careful when making deals in the first place. For instance, know about the types of landlords to avoid before finalising the tenancy contract. Similarly lookout for red flags before any deal.
FAILURE TO DISCLOSE DEFECTS ON THE PROPERTY
It is also among the common real estate litigation causes. The UAE law makes it compulsory for sellers to disclose any flaws in the property beforehand. However, if the seller fails to inform about any such issues pre-handover, the buyer reserves the right to file a dispute.
Property defects can be one of two types – patent or latent. A patent defect is one easily visible without using any examination equipment such as broken windows or a leaking roof. On the other hand, a latent defect requires a professional eye and thorough examination. Latent faults become apparent after testing such as water leakage inside the walls or foundation issues.
To avoid such conflicts, it is better to hire a property inspection company. Fortunately, you can find a myriad of companies offering property inspection in Dubai, Abu Dhabi and other Emirates. Moreover, if you reside in Dubai, you can avail a service like Smart Judge for free of cost legal advice regarding rental rights.
NEGLIGENCE OR BREACH OF OBLIGATION
It’s the moral and legal responsibility of a real estate agent to offer sincere services to their clients. This includes offering services to the best of the party’s interest and not withholding any information.
However, if an agent acts against the client’s interests and is more focused towards gaining personal profits, the party can file a case. Some common cases of such disputes include an agent willingly hiding defects in the property just for the sake of their commission.
The party then ends up bearing the additional expense. Moreover, withholding any valuable information may also prompt a client to file a case. The government takes a keen interest in ensuring smooth and fair real processes and continues to introduce initiatives.
For instance, the real estate ethics by DLD among many more show the government’s interest in this regard. Be sure to do your research before hiring an agent or agency. Check out their portfolio and get in touch with some former clients to learn more about them.
The Litigation Process
If a real estate dispute is taken to court, this means the parties have failed to come to an agreement. To take a dispute to court, parties hire a real estate attorney to look after the proceedings. Let’s now take a look at how the litigation process takes place.
- The Party contacts the real estate attorney at a law firm
- The law firm evaluates the case and evidence provided
- The attorney goes through the title deed and all other documents
- Case Evaluation
- The firm sends a demand package to the opposite party
- Waits for a response from the other party
- The law firm files a lawsuit
- The final negotiation to come to an agreement outside the court
- The trial
This is the usual process of how a real estate litigation goes. However, it is important to know that the steps may vary depending on the case and the law firm.
These are all the real estate litigation causes and the ways to avoid them. The real estate market is a flourishing industry which observes frequent transactions and activities. A case taken to the court can cost time and money to the concerned parties.
Therefore, it is better to do your research. Investors and individuals should do thorough research about the real estate developers in Dubai, Abu Dhabi and other Emirates before stepping into a deal.
Additionally, real estate agents and brokers should offer unfiltered services to their clients. This is a great way to increase real estate agent credibility and land more clients.
Moreover, the property buying and selling process becomes a breeze when you opt for an authorised and trusted platform. Browse through these properties for sale in the UAE if you want to buy a property from a reliable platform.
Stay tuned to dubizzle’s property blog for information about some common causes of real estate litigation, solutions and more.
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