Can I get the rent cheques back if I decided to cancel the tenancy shortly after signing the agreement?

If the tenancy agreement does not include an explicit early termination clause, the tenant may not have the legal right to cancel the contract before the start date unless there are exceptional circumstances.

Termination of the contract before it begins can still result in financial consequences for the tenant, especially if it is determined that the cancellation was without proper cause or agreement.

Typically, a security deposit is meant to cover any damages or breaches of the contract, but it can also be used to offset any loss caused by the tenant's abrupt cancellation.

If the tenant does not move in or breaches the agreement, the landlord might use the security deposit as compensation.

Regarding the cheques for rent, the landlord might be entitled to deposit the rent cheque for the first month (or the next due month), especially if the tenant has already agreed to the rent terms and provided the cheques.

This depends on whether the landlord can prove that the tenant agreed to the terms and that they are within the legal boundaries of the UAE tenancy laws.

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While the contract doesn't explicitly mention an early termination clause, the landlord might argue that the tenant's sudden cancellation constitutes a breach of contract.

In some jurisdictions, this could allow the landlord to seek compensation for the loss of rental income.

The landlord might claim that the tenant's abrupt cancellation caused financial inconveniences, such as lost rental income and potential costs associated with finding a new tenant.

We will discuss the possibility of depositing the cheque and demanding two months' rent as a penalty according to the legal point of view.

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In this case, considering that the lease agreement has been signed, the checks (one for rent and one for a security deposit) have been collected, and the tenant decided to cancel the agreement one day before moving in, here are some key points to consider regarding the landlord’s rights:

1. Security Deposit Check:

• The landlord has the right to deposit the security deposit check upon signing the lease. This deposit is typically refundable unless there are damages to the property or a breach of contract. As long as the check is being used for its intended purpose (security against damage or violations), the landlord may deposit it.

2. Penalty for Early Termination:

• Since the lease agreement does not include a specific clause for early termination, the landlord may still be entitled to impose a penalty for early termination under local rental laws. an early termination by the tenant may be considered a breach of contract, allowing the landlord to claim compensation, which could include rent for a certain period (such as two months or more).

• If the tenant’s cancellation results in financial loss for the landlord (e.g., inability to rent out the property immediately), the landlord may be entitled to claim compensation for the lost rental income.

3. Registration and Its Effect:

• Although the lease has not been officially registered yet, the agreement was signed, which typically creates binding obligations between the parties. The tenant could still be bound to fulfill the terms of the agreement, including paying rent, until the official move-in or until the lease is formally terminated.

4. Next Steps:

• The landlord should carefully review the terms of the lease agreement, as well as the local laws regarding early termination and lease cancellations. Local rental laws will clarify if the landlord can claim compensation for lost rent due to early termination.

• If the tenant’s cancellation results in a financial loss, the landlord can potentially deposit the checks as compensation or request a penalty for the cancellation, depending on local laws and the specifics of the lease.

Summary:

The landlord may have the right to deposit the security deposit check and claim two months’ rent as a penalty for early termination, especially if the cancellation results in financial harm. However, it is essential to consult local rental laws to understand how these rules apply in your jurisdiction.

Dear questioner

Yes,

The landlord can ask for compensation for the loss if the tenant does not comply with the formal requirements of termination as long as there are no early termination clauses.

The landlord can ask for a rent of two months and other compensation for the monetary losses incurred until a new tenant is in the property.

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While the landlord has some rights under this situation due to the signed tenancy agreement, specific actions should align with applicable local laws regarding tenancy disputes.

Thank you for reaching out with your question.

In Dubai, once a tenancy agreement is signed, both parties are typically bound by the terms of the contract, even if the Ejari registration has not yet been completed.

Since your tenant signed the agreement and issued cheques, the landlord has a right to rely on the contract.

In the absence of an explicit early termination clause, the tenant may still be liable for financial repercussions due to the sudden cancellation.

The landlord may be entitled to deposit the security cheque and, depending on the circumstances, seek compensation for at least two months’ rent as a form of penalty or liquidated damages, as this is commonly enforced in the absence of a termination clause.

However, specific recourse depends on the exact language in the tenancy contract and any mutually agreed terms.

To proceed effectively, I recommend consulting further on the potential steps to secure the landlord's rights and minimize financial loss. Please feel free to reach out to me directly via WhatsApp, phone, or email to discuss your case in more detail.

Best regards,

Suhail Rana

Dear AG,

Thanks for your inquiry.

According to UAE law, the landlord is entitled to deposit the cheques and demand 2 months' rent as a penalty in this case.

This is because the tenant has signed a tenancy agreement and has agreed to pay the rent for the full duration of the contract.

The landlord has also incurred financial inconvenience as they have prepared the property for the tenant and may have turned down other potential tenants.

If the tenancy contract does not have an explicit early termination clause, the landlord can still enforce the terms of the contract and demand the full rent for the duration of the contract.

However, it is recommended to try and negotiate with the tenant and come to a mutual agreement, such as deducting a portion of the penalty or allowing the tenant to find a replacement tenant.

It is important to note that the landlord must follow the proper legal procedures for depositing the cheques and claiming the penalty.

This may involve filing a case with the Rental Dispute Settlement Center. It is advisable to seek legal advice in this situation to ensure that all legal procedures are followed correctly.

Kindly do not hesitate to contact us by phone or email for further guidance.

Greetings