In a recent article published by Khaleej Times, Dubai’s Rental Dispute Center has established a judicial principle allowing both landlords and tenants to annul lease contracts before they are implemented if deception is proven.
Implementing this ruling helps a large number of tenants and landlords avoid the trouble disputing issues involving the withholding of information or deception by one party against another. This is based on articles 170, 171 and 173 of the UAE Civil Transactions Law.
How does an annulment happen when renting in Dubai?
As an example: If a landlord finds out that a tenant or property management company has a history of bounced cheques, unpaid obligations and other rent-related disputes, the landlord can raise a request with the RDC to annul the agreement that was signed.
So, in the specific case provided above, even if the agreement was initially signed and there were no issues with the current terms of the agreement, the landlord discovered something that was not initially revealed and such revelations can potentially get an agreement annulled if proven.
What should landlords and tenants do?
The most general response to this is to do enough background checks without just limiting them to the standard checklist to complete the documentation process when renting in Dubai.
When dealing with companies, the client can always check their track record, understand what kind of clientele they handle, or look at the feedback from their past clients. Make sure you actually go through the agreement you sign and understand if any loophole is left open or if anything is phrased in a questionable manner.
Individuals do not have a public track record most of the time, but you can request necessary certification to understand their form of income, the regularity of it, the nature of their occupation and whether their social behaviour has any flagged history. The initial conversations and approach are the best time to determine if the individual or the institution has certain elements that would raise any flags.
Rental Good Conduct Certificate.
The Dubai REST app provides an option to eliminate a huge part of this issue. Rather than collecting documentation and information individually, there is an option for both tenants and landlords to get official certification of the other party’s rental history.
The Rental Good Conduct Certificate is available on the Dubai REST app, which is reportedly free of charge to be obtained. It provides information about any rental cases that the RDC would have on a specific person.
Make sure to conduct due diligence before entering a tenancy agreement in Dubai.
The RDC’s move to provide the option to annul rental agreements that are proved to be deceptive is a healthy step towards creating a better rental culture in Dubai. Without having to be trapped in an agreement in which you have been deceived, both tenants and landlords now can remove themselves from contracts they would otherwise dispute.
Even if renting out a property or looking for a property to rent via a property consultancy seems stress free, most clients would have to depend on the due diligence of the company that does it for you. This is why renting out or finding a property to rent via a consultancy that is reputed and has the required expertise is important.
Dealing with a multitude of contracts, agreements and property transactions in Dubai and internationally, Anarock makes sure that every party in an agreement with us is secured. Make sure you are informed, and in good hands in Dubai’s property market.
Source: Khaleej Times