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Eileen v Ehud [2014] DIFC SCT 003

Eileen v Ehud [2014] DIFC SCT 003

May 18, 2014

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Claim No. SCT 003/2014

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

In the name of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Ruler of Dubai

IN THE SMALL CLAIMS TRIBUNAL OF DIFC COURTS
BEFORE H.E JUDGE OMAR AL MUHAIRI

BETWEEN

EILEEN

Claimant

v

EHUD

Defendant

Hearing: 17 April 2014

Judgment: 27 April 2014


JUDGMENT OF H.E JUDGE OMAR AL MUHAIRI


Parties

1. The Claimant is Eileen.

2. The Defendant is Ehud.

3.  The property in this dispute is a one bedroom apartment.

Factual Background

4. The Claimant filed a Small Claims Tribunal complaint against the Defendant.

5.  The Claimant asserts that the Defendant overstayed his rental lease and requests the payment of the rent for the unpaid period from 11 March 2013 until the Defendant vacates the rental unit.

6. On 11 March 2013, the Claimant and Defendant signed a one year tenancy contract for a one bedroom apartment. The contract was to expire on 11 March 2014.

7. On 28 February 2013, the Claimant sent a letter to the tenant indicating that he must vacate the premises on 30 May 2013 with no option to renew the contract because the Claimant intended to use the unit for his “self- use purpose.”

8. On 20 May 2013, an e-mail was sent from the Defendant’s attorney indicating that the notice to vacate the unit sent by the Claimant had been insufficient. He asserted that a landlord must notify the tenant with valid reasons for eviction at least twelve months prior to the determined date of eviction, pursuant to Dubai Law No. 26 of 2007, Article 25. This e-mail was forwarded to the Claimant.

9. On the last day of the Tenancy Contract, 30 May 2013, the unit was not vacated by the Defendant.

10.  The Claimant sent an additional letter to the Defendant on 5 August 2013 through his legal representatives, demanding the Defendant’s eviction, claiming that the tenant was illegally occupying the unit without a tenancy contract.

11. The Defendant was given thirty days to vacate the unit before the Claimant would commence legal proceedings before the DIFC Courts.

12. On 13 January 2014, the Claimant filed a claim with the Small Claims Tribunal, now under consideration by this court.

13. On 29 January 2014, the Defendant disputed the claim filed by the Claimant on the grounds of jurisdiction. He contends that the DIFC Courts in general and the Small Claims Tribunal in particular are not competent to hear the dispute in question based on Article 9 of the Tenancy Contract.

The Hearing

14. The Claimant and the Defendant attended the hearing on 17 February 2014; the Defendant contested the jurisdiction of the Small Claims Tribunal and claimed that the DIFC Courts were not competent to hear the dispute based on Article 9 of the Tenancy Contract.
15. The Claimant asserted that the tenant must vacate the premises and pay the rent due.

Jurisdiction

16. The relevant provisions of DIFC Law identifying the scope of the Court’s jurisdiction are set out in Article (3) of the DIFC Law No. 4 of 2007; amended by Amendment Law No. 4 of 2012 covering Real Property Law, which states, “This Law applies to real property within the jurisdiction of the DIFC.”
17. Additionally, Article (9.1) indicates that, “Dubai real property laws do not apply to real property governed by this Law.”
18. Article 5(A.1.b) of the Judicial Authority Law (No. 12 of 2004) which was amended by Dubai Law (No. 16 of 2011 in respect of DIFC Courts) provides as follows:
“The Court of First Instance shall have exclusive jurisdiction to hear and determine: (b).Civil or commercial claims and actions arising out of or relating to a contract or promised contract, whether partly or wholly concluded, finalized or performed within DIFC or will be performed or is supposed to be performed within DIFC pursuant to express or implied terms stipulated in the contract;..”
19. With regards to the Small Claim Tribunal in particular, the Rules of the DIFC Courts state at Rule 53.2(1):

“The SCT will hear and determine claims within the jurisdiction of the DIFC Courts where the amount of the claim or the value of the subject-matter of the claim does not exceed AED 100,000.”

20. In this case, the civil claim arising out of the Tenancy Contract signed by the Claimant and the Defendant, was wholly performed and implemented within the DIFC pursuant to explicit and implied terms stipulated in the contract.
21. The real property in this case is located in the DIFC and the contract was carried out and implemented within DIFC. Furthermore, the Tenancy Contract signed by both parties expressly states under Observation (3), “Both parties agree to register the Tenancy Contract with Dubai DIFC.”
22. The Defendant’s argument in support of his challenge to jurisdiction relies on Article 9 of the Tenancy Contract which states:

“If the tenant is absent from the town at the expiry of the Period of Tenancy or leaves the premises without the Landlord’s consent or if he has not paid the balance of the Rent due by him the Landlord has the right to ask the Local Sharia Court to open and hand over to him the Premises after counting and selling the contents and paying the Landlord his dues.”

23. This Article of the contract applies only to a specific instance as indicated in the clause. It applies if the tenant is not in the country at the time the Tenancy Contract expires; if the tenant leaves the premises without the landlord’s consent; or if the tenant has not paid the balance of the rent due to the landlord. Furthermore, as the clause indicates, it is only within the landord’s discretion to ask the Local Sharia Court to open the premises. This clause does not indicate jurisdiction, it indicates the right of a landlord to open the premises if one of the three specific instances laid out in the clause are established.
24. There is no agreement between the two parties as to jurisdiction of the Local Sharia Court in the Tenancy Contract and furthermore, the Local Sharia Court no longer exists as it has been replaced by the Dubai Courts. Additionally, Dubai Courts do not hear real property cases as these claims are transferred to the Rent Dispute Centre which is established by Decree No. 26 of 2013. Furthermore, Article 6 (B)(1) of Decree No. 26 of 2013 states that the Rent Dispute Centre does not have jurisdiction to hear or determine disputes within free zones that have a tribunal or special court to hear and determine disputes within their borders.
25. As such, Dubai Courts do not have jurisdiction over this claim as the Tenancy Contract in this case was wholly performed and implemented within the DIFC and the real property in this case is located within the DIFC.
26. For the reasons stated above, it is hereby decided that the DIFC Courts in general and Small Claims Tribunal in particular have jurisdiction to hear and determine the dispute in question and the Defendant’s application to contest jurisdiction is denied.

FOR THE ABOVE MENTIONED REASONS IT IS ORDERED THAT:

1 . The Defendant’s application to contest jurisdiction is denied.

2.  The Court has jurisdiction to hear and determine this claim.

3. All parties to pay their own costs.

Issued by:
Nassir Al Nasser
Judicial Officer
Date: 18 May 2014
At: 12pm

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