Dubai Court Rules Arab Woman Insolvent Over Dh425,000 Mounting Debt

The Dubai Civil Court has declared an Arab woman insolvent after she accumulated debts of Dh425,000 to several banks and institutions. The court ruled that she was unable to meet her financial commitments or repay her outstanding dues. As part of the order, the court imposed regulatory measures, including a travel ban, and notified the relevant authorities and the Al Etihad Credit Bureau to register the decision in the official registry.

The woman herself had approached the Dubai Civil Court, requesting to be declared insolvent and for proceedings to begin. She explained that she could not repay her debts due to multiple financial obligations and limited income or assets. After reviewing the petition, the court issued a preliminary ruling to accept the request and initiate insolvency procedures. A trustee was appointed to examine her financial status and prepare a detailed report of the debts and available funds. This report will be published in two local newspapers, inviting creditors to file their claims.

The trustee’s report confirmed that her total debts amounted to about Dh425,905, owed to various entities. This included loans to a bank, an unpaid cheque amount, outstanding credit card dues and private school fees of Dh14,758.

The findings also confirmed that the woman does not own any property, vehicles or other attachable financial assets. She is neither employed nor engaged in any productive profession. Her monthly salary of Dh14,000 was found insufficient to meet her basic living costs, let alone repay the accumulated debts.

Accordingly, the Court declared her insolvent, commencing proceedings and suspending all creditor actions. She was prohibited from taking new loans or financing for three years and barred from entering into obligations, except where required for her essential needs.

Dr Alaa Nasr, the woman’s legal representative, explained that the UAE’s insolvency laws provide a structured mechanism to help debtors settle their obligations. This involves appointing an expert to audit debts and liquidate assets from the moment an insolvency request is accepted until the final ruling is issued.

He further noted that the law grants the debtor key protections during this period, such as suspension of enforcement actions and immunity from lawsuits. However, to benefit from these safeguards, the debtor must act transparently, disclosing all assets and liabilities while truthfully declaring their actual debts.

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