A new Dubai court that will deal solely with property disputes has started to register new cases and over the next few weeks will take on the backlog at the Dubai Real Estate and Regulatory Authority (Rera). The Property Court, which is an arm of Dubai's First Instance Court, began registering new cases on Sunday. It is expected to reduce the workload of Rera, which has been swamped with property disputes since it was set up last year.
The new court will also come as a relief to property investors, who until now have faced a wait of up to three years for their cases to be heard by Dubai's civil court. With many more disputes emerging out of the emirate's property boom, the Dubai Government issued a decree last December laying the groundwork to establish a specialised authority to handle property disputes. The court is expected to cut waiting times and the duration of each hearing, though it is too early to say by how much. Most of the issues Rera deals with relate to complaints by property buyers over project delays and contractual disputes.
While the authority acts as a mediator between investors and developers to reach amicable solutions, more contentious problems have to go through the court. According to a spokesman at Rera's legal department, the authority will transfer cases that require legal resolution over to the Property Court after Ramadan. The department has just three people handling property complaints. "We deal with dozens of issues, but some are the job of the court to handle," said the spokesman. "The new court will help us a lot."
The civil court has started to cut back on property cases in the last few months, in view of the arrival of the Property Court. Rera also reached a saturation point, prompting a slowdown in the number of complaints it takes on. "I filed a complaint to Rera in April, expecting it to take a month, and was told in June that it was so swamped it couldn't deal with any more complaints," said Christopher Mills, a property lawyer at Clyde & Company.
"And with the civil court refusing to take on new cases because of the decree, we didn't know where to take new complaints. The Property Court will no doubt come as a significant relief to Rera." Mr Mills added that three judges working within the civil court system will be transferred to the Property Court, with hearings expected to begin towards the end of September. He said that the majority of cases handled by the court would likely be those raised by expatriates who have invested in property in areas of Dubai that have been designated for foreign ownership.
The disputes are likely to fall into a number of categories including project delays, nonconformity with the property's initial description and avoidance of contact with investors. "The Property Court is another sign that Dubai realises specialism in its court system is required," said Mr Mills. Confidence in Dubai's property market has been hit by a series of high-profile conflicts between developers and investors, such as problems between offplan buyers and the developers of Ivory Tower in the International Media Production Zone (IMPZ). Investors in Schon Properties' Dubai Lagoon development have also raised complaints with Rera over the project's delay.
But both projects were launched before Rera was established, giving it little power to address conflicts arising from contractual issues. Until now, investors have had limited legal remedy for their problems. "Hopefully the Property Court will produce a bit more confidence in the market," added Mr Mills. email@example.com