Property service charges non-payment consequences

  1. The Real Estate Regulatory Agency (RERA), the regulatory arm of Dubai Land Department (DLD), launched a judicial notices system against those defaulting in payment of common areas and service charges; in accordance to law No. 6 of 2019 concerning the jointly owned properties (JOP Law).
  2. The legal notice, which the newspaper got a copy of, detailed the charges and demanded payment.
  3. It also detailed 3 penalties that may apply as per the said law in the event of failure to pay due service charges:
  • First, banning the registration or renewal of lease contracts for the concerned unit.
  • Second, an execution judge may proceed with all and any judicial actions against defaulters same as those taken against debtors.
  • Third: sale of the real estate unit in an open auction.
  1. The notice stated that owner shall pay, to the managing entity as appointed by RERA, its share of service charges that cover the expenses of management, operation, maintenance and repair of common areas.
  2. Such share is determined by the ratio of the unit’s area to the total area of the JOP. It also stated that owner of sub developer may not abstain from payment of RERA-approved service charges for each unit.
  3. Also, the managing entity holds a usufructuary right for each defaulting unit.
  4. The notice also mentioned that in case of failure to pay the service charges share or any part thereof, the managing entity may, after 30 days of the date of notice, approach the execution judge to sell the defaulting unit by way of an open auction in order to recover the unpaid service charges.
  5. Furthermore, RERA shall notify the defaulting owner to pay the installments promptly to avoid the above legal actions and sale of unit in a public auction.
  6. A notice shall serve as a separate notice for each installment and there shall be no need to serve another at the due date of each installment.
  7. It shall remain valid in case of default and, furthermore, all expenses shall be incurred by the owner.
  8. Full payment shall be finalized by means of a receipt issued by the Notifying Party or by means of depositing the claimed amount into an account dedicated to the JOP and notifying the Notifying Party of the deposit.


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