The reader had already paid the full amount and received the deeds to the property when the penalty was issued
Homefront: Can a developer fine me for late payment a year after handover?
I have recently received a fine for late payment for the handover of a property. We have already paid the full amount and the deeds have been issued but over a year later I have received a huge fine - is this legal? I’ve spoken to many people and everyone says the developer is just trying it on, but it’s still worrying that this is even possible. Why not charge this fee on handover? DS, Dubai
The main question here, which may determine the legitimacy of the developer’s claim, is did the developer provide you with a no objection certificate prior to obtaining the title deed? If yes then the developer would not be able to claim any penalty whatsoever. Having said this, even if no NOC was given, it would be difficult for a developer to substantiate the claim.
My advice would be to initially double check this with a lawyer because each case is taken by its own context and merits. My take on it is that the developer is trying it on. Given the current economic climate, this is becoming a common trend by companies, they send out these claims in the hope that they might get something back in return.
Read more from Mario Volpi:
I did not want to renew my tenancy contract and provided one month's notice of my intention to the landlord. The contract has a “not-to-renew” clause requiring 90 days' notice to the landlord, otherwise there is an automatic renewal. So basically, I’m giving less notice than required by the contract. The landlord insists that I have to renew for another 12 months at the existing contract price, and there are no other options on this. However, the contract does not have any clause that deals with providing late notice. There is a clause that states “in the event of the contract being broken, the tenant will have to pay the rent until a new tenant is found". RS, Dubai
The terms of any contract have to be adhered to by the parties that agreed to it by signing the contract in the first instance. The problem I see is that when these terms/clauses go against what is mentioned in the law, then your only other route would be to challenge the contract/landlord by filing a case at the Rental Dispute Settlement Centre. Only a judge can decide the outcome because clearly you and your landlord are looking at this issue from polar opposites.
Law 33 of 2008 amended Law 26 of 2007 and did away with the necessity for tenants to give 90 days’ notice for reason of non-renewal. Please note that there is a fee of 3.5 per cent of the rental amount to open the case.
My advice would be to initially continue with the dialogue between you and your landlord to see if you can come to some form of agreement. Explain to him that the law does not recognise the 90-day rule any more (for non-renewal).
Clearly if you get nowhere, at least you have the option to file the case and let the judge decide.
Mario Volpi is the sales and leasing manager at Engel & Volkers. He has worked in the property sector for 34 years in London and Dubai. The opinions expressed do not constitute legal advice and are provided for information only. Please send any questions to email@example.com