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Shoreline maintenance fees row continues

Official registration of owners' associations for the Shoreline Apartments on The Palm Jumeirah stalls after board members are asked to sign document banning them from speaking to the media.
The Shoreline Apartments at the Palm Jumeirah in Dubai.
The Shoreline Apartments at the Palm Jumeirah in Dubai.

DUBAI // The official registration of owners' associations for the Shoreline Apartments on The Palm Jumeirah has stalled after seven weeks.

The registration was meant to empower owners in their dispute over service fees with the developer Nakheel.

To register the final eight of 13 groups, their board members were asked to sign a document preventing them from using any form of media to discuss association matters - a requirement property lawyers called unprecedented and too broad.

Meanwhile, the five groups registered on February 2 say they have no greater control over where the service fees are spent.

"They've just given birth to a 13-headed monster that isn't able to do anything," said a British owner who asked not to be identified. "We can't do a thing. It's all a bit depressing."

Owners said the Real Estate Regulatory Authority (Rera), part of the Dubai Land Department, told them the final registrations were being given an "internal audit".

"People are reluctant to characterise this as a limbo situation but it's a limbo," said one owner. "We don't know what's happening."

Rera did not respond to requests for comment.

When they were registered, owners hoped they could quickly replace the maintenance and other contractors used by Nakheel, believing they could find service providers for less. A Rera-stamped certificate said "the association can start undertaking the following responsibilities … reviewing the budget for the service charges and approving it … managing the association and common areas".

Instead, they ran into the same constraint other registered associations face. As non-legal entities, they needed the developer to handle legal tasks such as signing cheques and contracts.

Nakheel would not assume such responsibilities for Shoreline because the owners might not repay the developer, its chairman Ali Lootah said last month.

Shoreline owners owed Dh72 million in service fees as of December, with some refusing to pay for what they called poor maintenance.

Nakheel banned residents in arrears from access to the beach, gymnasium or pool. Over the next two months it collected nearly half of the outstanding amount.

The controversy drew wide attention after residents complained on Facebook and to the press.

The new document from Rera, called a Declaration of Compliance of Ethical Guideline, appears to ban such discussions.

The Arabic wording, considered the official version, banned the use of "media platforms, whether audio, written or audio-visual, for advertising purposes or to discuss any issues related to the association or a member thereof".

The English version, printed on the same page, had several differences. It prohibited "complaining" about any "private issue" or "dispute" and listed additional media "including internet, radio, paper, telephone, digital media or any other form of media".

The English wording seemed to be aimed at protecting the confidentiality of board members but the word "private" was probably a mistranslation of the Arabic word for "related to" (khasa), said the property lawyer Ludmila Yamalova.

"In Arabic it's much broader," Ms Yamalova said. "Basically, none of us should ever talk about anything related to our association. It's a total curtailment of free speech."

The document may conflict with the Rera-issued Association Constitution, which obliges board members to act in the best interest of owners, said Shahram Safai, the head of property at the Afridi and Angell legal consultancy. Board members may believe that discussing their dispute publicly fulfilled that responsibility, he said.

The Association Constitution has no ban on media but says board members "must not unfairly or unreasonably disclose information held by the owners association, including information about the owner or occupier of a unit, unless authorised or required by law".

The "ethical guideline" may have been intended to reinforce such privacy protections, Mr Safai said, but the wording is too broad.

"I have not seen this type of ban before," he said.


Updated: March 25, 2012 04:00 AM

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