Investor must give partner cash back after failing to share car auction profits: Abu Dhabi court

An Abu Dhabi court has dissolved a business partnership between two young men who went into the car auction trade together, after one partner failed to share the profits or return the initial investment, Emarat Al Youm reported.

The Commercial Court ordered the defendant to repay the original capital of Dh62,500 to his partner, ruling that he had breached his contractual obligations by buying and selling cars without distributing the agreed-to profits.

Court documents show that the claimant filed a lawsuit seeking Dh62,500 plus 12 per cent annual interest from the date of the claim until full repayment, along with legal fees and expenses. He said he had entered a partnership with the defendant to buy vehicles from auctions and sell them for profit, with each party to receive an equal 50 per cent share of the proceeds.

The claimant said he paid the agreed amount to start the venture, but his partner failed to distribute the profits or return the money, despite repeated informal requests. To support his case, he submitted copies of the partnership agreement, account statements, and email correspondence.

The defendant, in his written response, denied wrongdoing and asked the court to postpone the ruling until witnesses could be heard, arguing for the case to be dismissed.

In its judgment, the court said it was clear from the documents and an expert report that the claimant had indeed transferred Dh62,500 to the defendant. The report confirmed that four cars were purchased through auctions, one of which the defendant admitted selling, yet he failed to provide any evidence of profit distribution.

The court concluded that the defendant had not fulfilled his key obligation under the contract to share profits, which undermined the purpose of the agreement. The court therefore ruled that the failure amounted to a breach justifying termination of the partnership.

Rejecting the defendant’s request to summon witnesses, the court said the case documents were sufficient to reach a decision. It ordered the dissolution of the partnership and instructed the defendant to pay the claimant Dh62,500 plus 2 per cent annual interest from the date of the claim until full repayment, not exceeding the principal amount. The court also ordered the defendant to bear all court costs and dismissed all other claims.