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Dubai Court rules realtor to refund Dh922,000 to investor

The child handed over the envelope to Buhaira police station. (Magdy Iskandar))

By Mohammed El Sadafy

A realtor is responsible for bearing damages to any party involved in a contract in case of fraud, established the Dubai Court of Cassation in its new legal principle, and added that the realtor should not involve in deals violating laws.

The legal principle was issued in a verdict given in favour of an investor, wherein the realtor was ordered to refund Dh922,000.

The woman investor claimed that she had paid the realtor Dh922,000 - in two cheques  of Dh631,000 and Dh291,000 – for buying a unit from a real estate development company after he told her that realty prices had doubled and it was a good opportunity to buy and sell units.

However, she learnt later that the developer was not registered with the Ajman Real Estate Regulatory Agency. When she checked with the realtor, he told her that he had booked a residential unit, and would return the amount after its sale.

The investor (plaintiff) claimed that she also discovered that the realtor had neither made any investment nor was the developer (company) – from whom he claimed that he had bought the property from - registered with the Ajman Real Estate Regulatory Agency.

So she filed a case of cheating against the realtor in a Dubai civil court demanding a refund, but the realtor moved the Court of First Instance, saying that a civil court is not specialised in looking into such disputes.

The Court of First Instance dismissed his appeal and confirmed that the proceedings, indeed, is a civil case as it’s a claim of cash, and also ruled that he refund the amount, plus 5 per cent interest from the date of jurisdiction claim.

The realtor challenged the verdict in the Court of Appeal, which dismissed his appeal.

The realtor then moved the Court of Cassation, which upheld the judgment of the lower courts and ordered him to pay the amount.

The Court of Cassation based its judgement on Article 18 and Article 22 of Regulation 85 of Registered Realtors, 2006.

Article 18 stipulates that brokers (realtors) are wrong if a deal is made violating applicable laws and regulations. Article 22 establishes that it is realtors’ responsibility for any loss or damage, incurred as a result of fraud, to any of the parties involved in a contract.