Claim No: SCT 095/2017
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
In the name of His Highness Sheikh Mohammad Bin Rashid Al Maktoum, Ruler of Dubai
IN THE SMALL CLAIMS TRIBUNAL
BEFORE SCT JUDGE MAHA AL MEHAIRI
Hearing: 22 May 2017
Judgment: 28 May 2017
JUDGMENT OF SCT JUDGE MAHA AL MEHAIRI
UPON hearing the Claimant’s representative and the Defendant
AND UPON reading the submissions and evidence filed and recorded on the Court file
IT IS HEREBY ORDERED THAT:
1.The Defendant shall pay the Claimant the amount of AED 16,000 as rent for the period of 8 April 2017 through 8 June 2017.
2. The Defendant shall be responsible to pay his utility bills up to 8 June 2017.
3. The Claimant’s claim seeking eviction of the Defendant is accepted and thus the Defendant shall vacate the Premises by no later than 8 June 2017.
4. Each party shall bear their own costs.
Date of issue: 28 May 2017
1.The Claimant, Handan PJSC, is a landlord, renting apartments in the Hadwin Building in the DIFC.
2. The Defendant, Haunani, is the tenant in Unit H of the Hadwin Building in the DIFC (“the Premises”).
Background and the Preceding History
3. The Defendant entered into a Tenancy Agreement to rent Unit H of the Hadwin Building from the Claimant for a period commencing on 8 April 2016 (the “Tenancy Agreement”). The Tenancy Agreement listed the Landlord as Handan LLC and listed the Managing Agent as Hannah LLC (“Managing Agent”). The amount of rent for the 12-month lease agreement was listed as AED 96,900 payable by three cheques given in advance to the Managing Agent.
4. On 2 January 2017, the Managing Agent sent an email to the Defendant enquiring whether he wished to renew his Tenancy Agreement for another year. The email also contained a reminder that the expiry date of the Tenancy Agreement was 7 April 2017 and informed the Defendant that should he not wish to renew the Tenancy Agreement, the Managing Agent would provide him with the vacating procedures. On the same day, the Defendant replied to that email showing his intention to renew the Tenancy Agreement. On 8 February 2017, the Managing Agent sent an email back to the Defendant attaching the tenant update form in order to initiate the new lease process, but the Defendant never returned this form back to the Managing Agent.
5. On 15 March 2017, the Claimant sent an email to the Defendant containing notice of a change in property management, informing that the Managing Agent Hannah LLC would no longer be managing the Premises and instead the management would be taken over by the Landlord directly effective from 22 March 2017. The email also informed that any renewal/new lease/moving out agreements made with the old Managing Agent would remain valid and would continue as promised.
6. On 5 April 2017, the Claimant sent an email to the Defendant identifying that the Tenancy Agreement was expiring on 7 April 2017, and that the Defendant had not responded regarding the suggested renewal of his Lease Agreement. The email also expressed that if the Defendant wished to renew as he had previously stated in his email to the old Managing Agent, the renewal would be provided on the same terms and conditions as previously agreed. After communication with the Defendant and on 7 April 2017, a draft copy of the renewed Tenancy Agreement and the update form were shared with the Defendant, so that he could sign the renewed Tenancy Agreement for another year. However, the Defendant failed to send any signed forms back to the Claimant.
7. After several emails, the Defendant still did not revert back with his signed documents renewing the Tenancy Agreement for another year. On 9 April 2017, the Claimant sent a notice of breach of Tenancy Agreement stating that the Defendant was illegally overstaying in the Premises and that his Tenancy Agreement had elapsed. The notice also contained a demand to vacate the Premises pursuant to the Eviction notice sent on 2 January 2017, stating that rent owed for the period of overstay would be calculated on a pro-rata basis. The Claimant also sent the vacating procedure for the Defendant’s reference and action
8. On 26 April 2017, the Claimant filed a case in the DIFC Courts’ Small Claims Tribunal (the “SCT”) seeking eviction of the Defendant, payment for the Defendant’s overstay in the Premises after 8 April 2017, and for the Defendant to provide clearance letters from the utility service providers prior to vacating the Premises.
9. The Claimant’s representative and the Defendant attended a Consultation on 7 May 2017 before Judicial Officer Nassir Al Nassir. However, the parties were unable to reach a settlement during or after the Consultation.
10. As the parties could not reach a settlement, they were called for a Hearing before me, SCT Judge Maha Al Mehairi, on 22 May 2016, at which time I heard submissions from the Claimant’s representative and the Defendant.
Particulars and Defence
11. The Claimant argues that the Defendant was offered many opportunities to renew his Tenancy Agreement, but he failed to complete the renewal procedures. While the Defendant did express interest in renewing his Tenancy Agreement in his email to the old Managing Agent, he did not follow up on his request by sending the updated tenant form or the signed renewed Tenancy Agreement.
12. The Claimant relies on Clause 5.1 of the Tenancy Agreement which states:
“This Tenancy Agreement shall expire on the expiration date and the Tenant accepts that it shall not be renewed. The Tenant undertakes to vacate the Unit(s) by the expiration date.”
13. The Claimant argues that the Defendant, having previously signed the Tenancy Agreement, was well aware of the expiry date and had further been reminded of the expiry date on numerous occasions.
14. The Defendant responded to the Claim, indicating his intent to defend against it. In his submissions, he argues that the employees of the Claimant were aware of his intent to renew the Tenancy Agreement as informed to the prior Managing Agent. He also added that the Claimant only emailed him one day before the expiry date for him to finalise the renewal of the Tenancy Agreement. He further argued that the Claimant contends that its representatives called him, and that his mobile was switched off, however this was not true because the phone was never switched off. In his Defence, the Defendant contends that the Claimant never sent the new Tenancy Agreement for him to sign.
15. At the Hearing, both parties reiterated their arguments. The Claimant argued that the Defendant should vacate the Premises pursuant to Clause 5.1 of the Tenancy Agreement, and the Defendant argued that his intention was to renew the Tenancy Agreement, as was obvious from his email to the prior Managing Agent.
16. First and foremost, the relevant Tenancy Agreement states at Clause 9.1 that the “Agreement shall be governed by the prevailing laws of the DIFC, United Arab Emirates” and that upon failure to resolve any disputes connected to the Tenancy Agreement, the “dispute shall be referred to the DIFC courts.” Therefore, it is clear and undisputed that the DIFC Courts have jurisdiction to decide this matter. As the claim value is less than AED 500,000, this claim is properly before the Small Claims Tribunal of the DIFC Courts.
17. The issue before me to determine whether there has been a valid renewal of the Tenancy Agreement and, if not, what results from the expiration of the Tenancy Agreement. As discussed above, neither party has submitted any evidence showing that the Defendant’s intention to proceed with the renewal resulted in an actual renewal of the Tenancy Agreement. Even if the Defendant had every intention to do so, he failed to follow up that intention by sending the renewal form, or sending a follow up email, or even showing evidence that he tried to do so. On the other hand, the Claimant presented many opportunities to the Defendant for him to renew but he did not take them.
18. The Claimant also relies on Clause 5.1 as explained above, that gives it the right to evict the Defendant as soon as the period for the Tenancy Agreement expires. I am satisfied that the Tenancy Agreement has expired and that the Defendant is overstaying in the Premises, resulting in the requirement that he pay overstay rent on a pro rata basis.
19. In his previous Tenancy Agreement the Defendant paid AED 96,000 for 12 months. As he has already overstayed for one month and 20 days, I find it reasonable to order that he has up until 8 June 2017 to vacate the Premises and thus, he must pay the Claimant for two months of overstay rent for the period he overstayed in the Premises. This amounts to AED 16,000.
20. The Tenancy Agreement states under Clauses 3.7 and 3.8 that the Tenant undertakes to “[p]ay all charges for water, electricity, telephone, internet, air- condition, and district cooling capacity and consumption charges and the related third party billing fees” and that the Tenant undertakes to “[p]ay the district cooling bills on time and without delay.” Further, Clause 3.8 states that the “Tenant acknowledges and agrees that the district cooling billing will be prepared and collected by a third party company, and in that regard the Tenant undertakes to settle in full all charges and fees related to capacity, consumption, third party district cooling billing services including fees, fines and charges (if any).”
21. Thus, the Defendant is certainly responsible under the Tenancy Agreement to pay his utility bills, even though the Tenancy Agreement specifically states that the district cooling bill is prepared by and collected by a third party. The Defendant agreed in his Tenancy Agreement to “settle in full all charges” with that third party and has not, as yet, violated this agreement. Therefore, while the Defendant is responsible to pay these bills, I do not find it appropriate to grant the Claimant’s request to order the Defendant to provide clearance letters from the utility service providers prior to moving out, as such an order would be unenforceable and furthermore, it is more appropriate for the Claimant to bring a claim for any potential unpaid utilities when such a claim becomes ripe.
22. Each party shall bear their own costs.
Maha Al Mehairi
Date of issue: 28 May 2017
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