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Vacating a rented property for the purpose of sale

With property prices in Dubai continuously rising, we are witnessing a growing number of cases of landlords serving eviction notices to their tenants, for the purpose of the selling the property. It is widely known that a landlord must provide the tenant with 12 months’ notice, however there is often a question over whether an eviction notice served by the landlord, can legally transfer to a new owner, or if a new eviction notice must be served. The following article discusses this point.

When a property owner notifies their tenant of eviction as they intend to sell the leased property, a 12 months’ eviction notice is given as per the law. If during this period, the leased property is sold and the owner then notifies the tenant of this sale, it signifies that the rights and obligations arising from the lease agreement of the property in question have transferred from the previous owner to the new owner.

As such, the new owner is entitled to request certain obligations from the tenant, including the right to eviction under the same conditions as they were at the time of the eviction notice. Through the transfer of rights, and in the same capacity as the former landlord, considering them as the property owner, as established by the Dubai Court of Cassation, which ruled that:

"The assignment remains on the original commitment, transferring it from the assignor to the assignee with all its components, characteristics, and guarantees, and that the assignment of the right does not create a new commitment on the part of the assignee (debtor), but rather transfers the same original commitment standing against him to another creditor, who becomes the assignee, with all its consequences and guarantees. Upon its expiration, the assignee takes the place of the creditor in the same right assigned, in the condition that it was at the time of the creditor's acceptance of the assignment or announcement thereof, along with the characteristics attributed to it. The consequences of the right are transferred, including the claims that confirm it."

Therefore, the request for eviction for the purpose of sale meets its requirements as stipulated by law, and the tenant is required to pay the rent for the period following the expiration date of the eviction notice until the completion of the eviction.

This article, authored by Saad Younes, Senior Associate, explains that when a property in Dubai is sold, the new owner inherits any eviction notice issued by the previous landlord and can enforce it under the same conditions, as upheld by the Dubai Court of Cassation.

BSA is a regional Law Firm in the Middle East with offices in the UAE, Oman and Saudi Arabia. As a full-service law firm our practice areas include litigation, arbitration and corporate services, including M&A, banking & finance, Intellectual Property, TMT, Fintech, employment and insurance.

Published on 04 June, 2024.

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