Questions & Answers
I bought a property off-plan and took me time to pay the 4% DLD. Can the developer cancel the contract?
I have bought a property in Dubai off-plan. The villa was completed at the end of Jan (1.5 months ago). I haven't had the funds to register the property with DLD until now, mid-March.
Until now, I have paid the 20% deposit to the builder and taking 80% on mortgage. The mortgage with the bank is now ready with the manager's cheque and sent to the DLD office ready for registration.
As it has taken some time for me to arrange the 4% DLD, the builder is now telling me he is going to cancel the contract or charge me an additional amount as the market price has gone up.
Is this possible?
What rights does the builder have?
I am ready to register the property next week with DLD but the builder is threatening to take alternative action.
We recommend reviewing the terms and conditions of the contract to determine if the developer has the right to increase the purchase price due to delays in registration procedures.
If the contract does not mention this, the developer is still obligated to abide by the contract and follow the laws of the country.
We recommend proceeding with the registration procedures in all cases.
TA
We are pleased to respond to your consultation
I cannot provide you with specific legal advice without knowing the terms of the contract.
But anyway, your rights are:
- The seller is not entitled to cancel the contract without a legal reason.
- The seller must afford you a reasonable opportunity to register the property.
- The seller may be allowed to impose a specific delay fine in the contract.
- The seller cannot charge additional fees that are not specified in the contract.
- Any fine must be a reasonable delay and proportionate to the seller's actual damage.
For further inquiries about your topic, you can reach our office or contact us on WhatsApp.
We have to understand the terms and conditions enclosed within the MOU in order to advise you regarding the rights.
Generally, the change in market price will not affect such a contract. Otherwise, it has to be accepted by both the parties.
We will discuss this in detail. Kindly share your WhatsApp number in order to proceed.
Dear Questioner,
Thanks for your inquiry.
Regarding the above, we would like to inform you that, according to Article 11 of Law No. 13 of 2008 (the "Real Estate Law") in Dubai, the developer is not allowed to cancel the sale and purchase agreement unless the buyer fails to pay the installments within the agreed timeframe.
In your case, it seems that you have paid the installments within the agreed timeframe and the delay in registering the property is due to your inability to arrange the DLD fees.
In such a situation, the developer does not have the right to cancel the contract or charge you an additional amount as the market price has gone up.
The developer is bound by the terms of the sale and purchase agreement and cannot unilaterally change the terms without your consent.
However, it is important to note that the developer may have the right to charge you a late payment fee for the delay in registering the property.
This fee should be specified in the sale and purchase agreement and should not exceed 2% of the property value.
If the developer continues to threaten you with cancellation or additional charges, you may file a complaint with the Dubai Land Department or seek legal advice from a lawyer specializing in real estate matters.
It is important to act quickly and protect your rights as a buyer.
Kindly feel free to contact us by email.
Greetings
The seller cannot cancel the contract as long as you do not breach your payment obligations.
He is also not entitled to impose any additional amounts unless the contract stipulates so
Therefore, you must review the purchase contract and its terms so that we can guide you properly and give correct legal advice.
For a free consultation and more information, kindly contact our law office by phone OR send an email.
