Hotel Unit Investor Ordered to Pay Dh1M for Failing to Take Possession

A Dubai court has ordered an investor to pay more than Dh1 million after failing to take possession of a hotel unit that had been ready for handover for over two years.

 

The Dubai Real Estate Court ruled that the defendant must pay Dh935,000 to a real estate development company, along with an additional Dh148,330 as a penalty for delaying receipt of the unit.

 

The dispute stems from a sale and purchase agreement signed in March 2016, under which the investor bought a hotel unit for Dh1.435 million. The developer completed the project, registered the unit in the buyer’s name in the initial register and obtained a completion certificate from the competent authorities.

 

According to court filings, the developer formally notified the investor in July 2023 that the unit was ready for handover and requested payment of the outstanding amounts to complete the transfer procedures. The investor, however, failed to appear, refused to receive the unit and did not settle the dues.

 

The developer subsequently approached the court, seeking the appointment of an expert to calculate the amounts owed as a result of the investor’s breach of contract. The court-appointed expert concluded that the defendant had failed to meet her contractual obligations and owed Dh935,000, including late instalment fines, penalties for delaying receipt of the unit and government service fees stipulated in the contract.

 

During the proceedings, the developer submitted the sale and purchase agreement, proof of notification of unit readiness and the approved expert report. The defendant did not attend the hearings despite being legally notified, which the court said supported the validity of the developer’s claims.

 

In its ruling, the court reaffirmed that a valid contract is binding on both parties and that a buyer is obligated to pay the agreed price, fees and penalties if they fail to fulfil their obligations. It accepted the expert’s findings, noting that the unit was ready for handover and that there was no lawful justification for the investor’s refusal to take possession.

The court also ordered the defendant to pay an additional Dh148,330 as a delay penalty covering the period from August 2025 to January 2026, along with legal interest of 5 per cent per annum from the date the lawsuit was filed until full payment.

 

The defendant was further directed to bear court costs, expenses and attorney’s fees. All other claims, including a request for future penalties beyond the date of the judgment, were dismissed.

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