Expat non-freehold 'ownership' illegal

Rejects appeal demanding share in lease of Mirdiff villa

The right of ownership in Dubai, in general, is confined to UAE nationals and citizens of GCC countries. However, in some areas, such as freehold property, expatriates have the right of ownership limited with time, ruled Dubai Court of Cassation.

As per the decree issued by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of UAE and Ruler of Dubai, non-citizens, including non-GCC citizens, have the right to use property (rent or live in it) or alternatively possess right to rent for a period not exceeding 99 years.

The Ruler's decree is a command and ownership cases require immediate retroactive action, ruled the court.  

The court spelt out the principles while hearing a property dispute. It rejected an appeal by an expatriate plaintiff who demanded a share in the lease of the villa in Mirdiff, Dubai, for which he had paid half the price. The villa was rented by his partner following a contract signed by the two regarding the management of the villa.

The plaintiff filed a suit asking for the appointment of an expert to inspect the villa to identify the value of his share according to the market price in order for him to sell it in an auction. He also wanted the the expert to determine the value of his partner's share.

The Civil Court had ruled the contract invalid and asked the defendant to pay Dh1 million to the plaintiff as compensation for damages.

Both the plaintiff and defendant appealed the verdict in the Court of Appeal, which modified the appellant's sentence and obliged the defendant to pay Dh103,000 to the plaintiff in recognition of the share in the rented villa.

Once again the two parties rejected the verdict and moved the Court of Cassation, which rejected the appeal, based on the text of Article 4 of Act 7 of 2006, which restricts the right to own property in the emirate of Dubai to citizens and nationals of GCC countries, with the exception of a decree issued by Sheikh Mohammed as per which a non-citizen can use or lease a property up to 99 years.

The court rejected the case as both the disputing parties are neither UAE citizens nor GCC nationals and did not have the documents of approval from the Ruler of Dubai for ownership.

The court added that though the contract was signed between the plaintiff and his partner - on November 10, 2002 - before the effectiveness of the provisions of Act 7 of 2006, as it is a public order the appeal is dismissed.

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