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Abu Dhabi, UAEThursday 15 November 2018

'Am I liable for my ex-husband's debts in the UAE?'

The Abu Dhabi resident says her former spouse has left the Emirates due to ill health

The reader's husband has left significant debts behind in the UAE. So is she liable for them?  Silvia Razgova / The National
The reader's husband has left significant debts behind in the UAE. So is she liable for them?  Silvia Razgova / The National

My ex-husband used to live in the UAE but left a short while ago and I believe he left large debts behind. He left partly as he can’t pay them but also as he is seriously ill so has gone home for treatment. I am concerned I might be held responsible for his debts, especially as the divorce has not been finalised. I don’t have the money to pay them but will the banks come after me if he doesn’t make the repayments or dies? SN, Abu Dhabi

Under UAE law, only the person whose name is on the debt, whether a mortgage, personal loan or credit card, is liable for it. A husband or wife is only accountable for a spouse’s debts if they are a guarantor or handed over a security cheque to the bank.

While it is not uncommon for a bank to contact someone with a connection to a defaulter, this must be in line with data protection rules and they cannot ask anyone else to repay an unconnected debt.

A legally married spouse is also not liable for the UAE debts of their husband or wife. Should a person die with outstanding UAE debts, this would not be the responsibility of the surviving spouse, but would need to be paid from the deceased’s UAE estate before any other monies are passed to beneficiaries.

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I work in a UAE university and all the professors are on a two-year probation period. I thought the UAE Labour Law stipulated six months as the maximum. Are higher education institutions exempt from this rule? Further, how much notice am I legally required to give if this two-year probation is indeed correct? MM, Abu Dhabi

UAE Labour Law states that a probationary period cannot exceed six months, per Article 37 of the law, which clearly clarifies this point. Note, however, that this law does not apply to everyone in the UAE. While free zones largely adopt these rules with few variations, there are some specific exemptions.

Article 3 of this Federal law states: “The provisions hereof shall not apply to the following categories: a - Employees and workers of the Federal Government and the governmental departments in the Emirates, members of the State, the employees and workers in public entities and institutions, whether Federal or local and employees and workers appointed for governmental Federal and local projects.” The Article goes on to mention other categories.

Even though this is a government employer, I would be very surprised if there is actually a two-year probationary period; perhaps it is actually a two-year fixed contract that has unclear wording or has been misread.

MM should check the wording in her contract of employment as this should clarify the agreement she made with the employer and the notice period required. All employees should check the terms of employment carefully before stating any job.

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We borrowed money in January 2017 from a loan shark, giving our passport as a guarantee. We were paying interest until my husband lost his job. Now we urgently need the passport back as my husband wants to take advantage of the current amnesty as he has overstayed on his visa. The loan shark does not want to return the passport without us paying back the full amount. What can we do now? EC, Dubai

It is never a good idea to borrow money from an unregulated and illegal source like this. I am well aware this happens as some people either do not earn a sufficient income to borrow from a bank or they have already exceeded the official lending limit, or are in the country without a proper visa. Loan sharks charge extortionate rates of interest with no legal safeguards.

No one is permitted to retain someone else’s passport; not an employer, not a bank, and certainly not a loan shark. The first step here is to send them a letter pointing out that it is illegal to retain a passport, that it needs to be returned immediately, and that failure to comply will leave no choice but to go to the police.

If the passport is not returned, EC and her husband will need to go to the police. The fact an amnesty is in place and that the loan shark is preventing them taking the proper action that is available should only assist with the case.

If money is borrowed, it should be repaid and I am sure they are being hassled but as the money was lent illegally I understand that by law there is no ‘right to collect’, so the loan shark has no legal recourse. Even if an agreement was signed, it will not stand up in court as the person lending the money has no right to charge interest. Under the penal code of the UAE, only a registered bank or financial institution is permitted to charge interest on money that is loaned to another party.

Keren Bobker is an independent financial adviser and senior partner with Holborn Assets in Dubai, with over 25 years’ experience. Contact her at keren@holbornassets.com. Follow her on Twitter at @FinancialUAE

The advice provided in our columns does not constitute legal advice and is provided for information only