Thursday, April 1, 2010

A new property law in the capital maintains the existing five per cent rent cap

A new property law in the capital maintains the existing five per cent rent cap and restrictions on the eviction of tenants, according to new legislation signed by President His Highness Shaikh Khalifa Bin Zayed Al Nahyan, in his capacity as Ruler of Abu Dhabi.
Changes were made only to certain articles of the law, No 20 of 2006, but article 23 that specifically spells out reasons for eviction was left unchanged.
Under the law, landlords cannot ask tenants to vacate except in specific cases, like approved demolition, for personal use, if tenants fail to pay rent, if tenants sublet the property without the approval of the landlord or violate public norms.
In the case of demolition of the building, tenants must be given a grace period of not less than six months to vacate. If the landlord fails to live in the property, he had asked to be vacated for personal use, for three months or re-lets it to another party, the tenant can complain to the Rent Disputes Resolution Committee.

The new legislation, which took effect from February 10, gives landlords and tenants the right to end the tenancy contract or change its terms, after giving two months' notice for residential property and three months for commercial and industrial property as well as professional offices.
"The new law removes a five year moratorium on the eviction of tenants, but it does not give a free hand to landlords to evict tenants," said lawyer Osama Abdul Aziz of the law firm Tarik Al Serkal.
The new law also creates a cassation committee and brings the existing Abu Dhabi Rental Disputes Resolution Committee, its appeal arm and the cassation panel under the authority of the Abu Dhabi Judicial Department.
The chairmen of the rent, appeal and cassation panels, who used to be officers appointed by the Executive Council, will now be judges, according to the law.
Rulings by the rent committee on leases of up to Dh100,000 are final. Rulings on leases above Dh100,000 can be appealed within 15 days from the date of the ruling and cases related to leases worth more than Dh500,000 may be looked into by the cassation committee. Tenants have 30 days from the date of the ruling of the appeals committee to file with the cassation committee.
Tenants who are about to reach the end of their contracts still enjoy protection until November 9.
A landlord may ask to evict a tenant before the November 9 deadline provided the Rental Disputes Resolution Committee agrees on the grounds that "the occupancy causes serious harm to the landlord and provided the tenant had already been living there for not less than two years," according to the law. A grace period of not less than six months from the date of the committee's decision is granted.