Question: I bought a real estate off-plan from one of the developers and paid 60 per cent of the agreed amount, but two months ago I stopped paying the instalment due to the termination of my services and I have no current income. Accordingly, I asked the developer to cancel the property purchase agreement and return part of the amounts I paid, but he refused. He also refused to transfer the property to a new buyer, whom I brought instead. What is the legal position on the developer and do I legally have the right to terminate the property purchase agreement because of the force majeure I am facing? Am I legally entitled before the court to request the transfer of the property purchase agreement to a new buyer whom I brought and to recover from him the sums I paid? Please advise
Answer: You can terminate the purchase agreement in front of the court but this will be on your responsibility because losing your job is not considered as a force majeure. You might lose all or some of the money you paid depending on the percentage of completion of the Real Property project unless there is a breach committed by the developer. You should refer to the conditions mentioned in your contract regarding termination and compensation which all contracts usually contain.
What law says
As per Article 11 of Law No. (19) Of 2020 Amending Law No. (13) of 2008 Regulating the Interim Real Property Register in the Emirate of Dubai, where the percentage of completion of the real property project exceeds eighty per cent (80%), the developer may terminate the off-plan sale agreement, retain up to forty per cent (40%) of the value of the real property unit stipulated in the off-plan sale agreement, and refund any amounts in excess of this to the purchaser.
Where the percentage of completion is between sixty per cent (60%) and eighty per cent (80%), the developer may retain up to forty per cent (40%) of the value of the real property unit. Where the percentage of completion is less than sixty per cent (60%), the developer may retain up to twenty-five per cent (25%) of the value of the real property unit. The rules and procedures stipulated in this Article will not preclude the purchaser from having recourse to courts.
As for the new buyer you brought, you are not entitled before the court to request the transfer of the property purchase agreement to him, because you cannot force the developer to make an agreement with another person. You may settle this matter amicably with the developer so that he might accept to give you a non-objection letter to be able to sell the property in the DLD (Dubai Land Department) to the new purchaser and recover from him the sums you paid.