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UAE Leasing Property and Maintenance Responsibilities

UAE Leasing Property and Maintenance Responsibilities

July, 2018
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Overview 

  • The general principles, which govern the maintenance obligations of a landlord and tenant in the
    UAE, are set out in Federal Law No. 5/1985 referring to the Civil Code, and further amplified in
    the laws of the individual Emirates.
  • The general principles are further amplified (concretised) in the tenancy contract signed by the
    landlord and tenant.
  • The principles in respect of the parties’ maintenance obligations apply to residential and
    commercial property as neither the Civil Code nor the laws of the Emirates draw any distinction
    between the two (as far as the maintenance obligations are concerned). However, it is practice
    that the tenant of a commercial property undertakes a greater responsibility in respect of the
    maintenance and repair of the leased property’s interior.

 

Definitions

  • Abu Dhabi Tenancy Law: Abu Dhabi Law No. 20/2006 concerning the leasing of spaces and
    regulating leasing relations between landlords and tenants in the Emirate of Abu Dhabi.
  • Civil Code: Federal Law No. 5/1985 referring to the Civil Transactions Law.
  • Dubai Tenancy Law: Dubai Law No. 26/2007 regulating the relationship between landlord and
    tenant; as amended by Dubai Law No. 33/2008.
  • Rental Dispute Centre: The Judicial Committee that deals with tenancy related disputes in each
    of the Emirates.
  • Leased property: Any property or unit leased to a tenant. Agricultural land, hotel apartments and
    property of an employer occupied by his employee at no charge, are excluded from the
    definition, as special provisions will apply to such property.
  • Major maintenance or necessary repairs: The repairs necessary for protecting the structure of
    the leased property and repairs necessary for the tenant to utilise the leased property, which the
    landlord is obliged to carry out.
  • Minor maintenance or rental repairs: Minor repairs the tenant undertakes to carry out.
  • Petition Order: The order granted by the Rental Dispute Centre on an urgent basis.
  • Tenancy contract: The written contract entered into between the landlord and tenant.

 

Practical Guidance

The Civil Code
The principles set out in the Civil Code are the following:

  • The landlord has the obligation to repair any defect that affects the tenant’s use and enjoyment
    of the leased property. If the landlord fails to do so, the tenant shall have the right to cancel the
    lease or to apply for an order that he be allowed to effect the repair and recover the fair and
    reasonable cost thereof from the landlord (article 767(1)).

Note: this would apply to major defects (structural of nature) where the tenant is deprived of beneficial
occupation or enjoyment.

  • For minor repairs or repairs which require urgent attention and the landlord fails to attend thereto
    or the tenant is unable to get hold of the landlord, then the tenant is entitled to attend to the
    repairs and recover the expenses from the landlord or deduct such expense from the rent due
    (article 767(2)).
  • If the tenant repairs any item in or on the leased property which has the effect of preserving the
    leased property then the tenant shall be entitled to recover his fair and reasonable expenses,
    even if no express agreement to that effect is in place with the landlord (article 768).
  • The tenant must take care (as would a reasonable man) of the leased property (article 776).
  • The tenant shall, during the term of the lease, carry out the repairs to the leased property, which
    he is obliged to carry out according to custom and the tenant is obliged to keep the leased
    property clean and tidy (article 779).
  • The tenant is obliged to return occupation of the leased property to the landlord upon the expiry
    of the term in the condition in which he took occupation, subject to any damage thereto, caused
    or suffered through no fault of the tenant.

 

The tenancy laws of the Emirates

  • The general principles set out in the Civil Code are amplified in the laws of individual Emirate.
  • Although the overriding principles will be the same in all of the Emirates, it is advisable to make
    specific reference to the applicable tenancy law in each of the Emirates if dealing with a leased
    property in a particular Emirate. As examples, we have made make specific reference to the
    laws of Dubai and Abu Dhabi below.

 

The Dubai Tenancy Law provides that:

  • The landlord is responsible for the maintenance works and repairs of any defects in
    respect of the leased property, which may affect the tenant’s intended use thereof, unless
    otherwise agreed between the parties (article 16).
  • The landlord is responsible for any defect, damage, deficiency or wear and tear, caused to
    the leased property for any reason not attributable to the fault of the tenant (article 17).
  • The tenant is obliged to maintain the leased property as a reasonable man would maintain
    his own property.
  • The tenant must return occupation of the leased property to the landlord in the condition,
    which he received occupation, fair wear and tear excepted (article 21).

 

The Abu Dhabi Tenancy Law mirrors the principles set out in the Civil Code and also provides
that:

  • The landlord shall maintain the leased property to keep it fit for use and shall carry out all
    necessary repairs excluding rental repairs during the rental period unless otherwise
    agreed (article 7).

Note however, the following limitation to the tenant’s remedies in Abu Dhabi:

  • If the tenant fails to refer a dispute to the Rental Dispute Centre within one month of being
    deprived of the use or enjoyment of the leased property, he shall forfeit his right to do so,
    unless the tenant is able to provide an acceptable reason for the delay in seeking the
    assistance of the Rental Dispute Centre (article 9).
  • In practice, the parties’ respective repair and maintenance obligations are set out in the tenancy
    contract.
  • Tenancy contracts often use the terms “major maintenance” or “minor maintenance” when
    referring to the parties’ respective maintenance obligations.

 

Residential leases

Landlord’s obligations. In respect of residential leased property the landlord is responsible for
the “major maintenance” items which include:

  • any structural repairs;
  • the air conditioning system and the cleaning thereof;
  • the plumbing and sanitary installation;
  • the electrical system.

If a leased property is leased as furnished, which is common in residential apartment blocks, this
includes the major furniture items, e.g., the television, beds, lounge suites, washing machine and
kitchen appliances, the maintenance of these items will fall under the principle of “fair wear and tear.”
For example, if the compressor of the fridge needs to be replaced, the landlord would have to attend
to that or at the very least reimburse the tenant for the cost of such.
However, if any of these items are destroyed or damaged by the tenant, then the tenant would be
obliged to repair the damage. In the case of the fridge, if one the glass shelves breaks, the tenant
would have to replace it.

Tenant’s obligations:

  • The maintenance obligations of the tenant (being “minor maintenance”) are those
    associated with day-to-day usage of the leased property’s furniture and appliances by the
    tenant, which would include replacing any items that the tenant breaks.
  • The tenant is obliged to return the leased property to the landlord in the condition that it
    was when the tenant took occupation, subject to fair wear and tear. It’s tenant’s obligation
    to replace any broken or damaged items (caused by the tenant) and the liability for the
    cost of repainting and cleaning the leased property on the termination of the lease.

 

Commercial leases

  • Although there is no distinction drawn between residential and commercial leases in respect of
    the parties’ maintenance obligations in any of the tenancy laws, in practice the tenant of a
    commercial property undertakes liability (responsibility) for a greater portion of the maintenance
    liability.
  • A typical clause in a commercial lease would be:
    “The tenant shall at its own cost and expense and at all times be responsible to repair, clean, maintain
    and keep the leased property (including the mechanical, electrical and plumbing systems contained
    therein) in good and safe working order and condition in addition to preventing any blockage of any
    sewerage or water pipes or drains in or used in connection with the leased property and remove at its
    costs and expenses any obstruction or blockage of sewerage, water pipes or drains.The tenant shall care for and maintain the interior of the leased property, and keep all the keys, locks,
    doors, windows, sewerage pans and pipes, electrical installations, water taps and appurtenances
    therein in good order and condition. At the termination of the lease agreement, the tenant shall return
    and redeliver the leased property to the landlord in like good order and condition, subject to
    reasonable wear and tear, and the tenant hereby undertakes to make good and repair at its own costs
    and expenses any damage/s or breakages and where applicable reimburse the landlord for the costs
    and expenses incurred by the landlord in replacing, repairing or making good any broken, damaged or
    missing items.”

Remedies

  • If a landlord fails to fulfil his maintenance obligations, the tenant may file a complaint with the
    Rental Dispute Centre for an order to compel the landlord to effect the repairs (a Petition Order).
  • The tenant may also attend to the repairs himself and claim the amount thereof as damages
    from the landlord or deduct the amount from a future rental payment.
    The tenant may also have the right to terminate the tenancy contract under certain
    circumstances.
  • If any of these courses of action are to be pursued it is important for the tenant to comply with
    the terms of the tenancy contract in respect of any notice which is required to be given to the
    landlord (breach notice) before any such actions are taken.
  • There are court fees which will be payable for any claim for compensation or for cancellation of
    the tenancy contract which must be taken into account.
  • Similarly, the landlord has the right to recover the costs of any maintenance and repairs from the
    tenant , for which the tenant is liable. This is usually deducted from the tenant’s deposit.
  • The landlord may also refer any dispute to the Rental Dispute Centre.

 

Related Content
Legislation

  • Federal Law No. 5/1985 referring to the Civil Transactions Law
  • Abu Dhabi Law No. 20/2006 referring to the Abu Dhabi Tenancy Law
  •  Dubai Law No. 26/2007 Dubai Tenancy Law; as amended by Dubai Law No. 33/2008

Publication: Lexis Nexis GLA

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