Nakheel wins Sao Paolo The World island dispute

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Nakheel on Sunday said that it has won a legal case against a development company which was seeking to renege on an agreement to buy an island on The World project.

The Dubai developer said in a statement that a tribunal had ruled in favour of Nakheel, The World and others in the case against Sao Paolo Development Ltd and Diamond Developers.

Nakheel said Sao Paulo Development Ltd had sought to renege on its commitment to purchase The World island of Sao Paulo.

It added that the Dubai World Tribunal held that the "reservation contract for The World island of Sao Paulo was enforceable and binding".

The statement said Sao Paolo Development Ltd was ordered to pay The World AED127.6m ($34.7m) to cover outstanding instalments owed on the island and accrued delay fees.

The tribunal also ordered the other claimant, Diamond Developers, to pay AED10.9m to Nakheel's Jumeirah Village subsidiary.

Development of The World has stalled in the wake of the global financial crisis, with all but one of the island owners completing construction.

Owners have told Arabian Business they have been unable to develop the islands due to a lack of vital infrastructure promised by Nakheel.

Nakheel has previously said that building work is the responsibility of the owners.

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Posted by: Red Snappa

Since when is a reservation actually a contract, they must have signed the next best thing to a sales and purchase agreement, also Diamond Developers must have been trying to transfer, their deposit on Sao Paolo to a Jumeirah Islands plot.

The bottom line even less likelihood of anything getting built longer term and a strong deterrent to future investors. A patch of compacted sand out in the Gulf, with no geological fundamentals to keep it in shape. No central infrastructure and services access point in the overall group of islands. Attractive prospect

Greek islands I can understand, they don't generally decompose over time!

Posted by: Saudi Engineer

WT, I guess that's your Dubai legal system for you...

Posted by: What The!?

I can't believe a court would enforce payments into an obviously stalled / shelved project!

Posted by: Glen

Yet another glaring inacurracy of your reporting, and if it was taken from another agency a glaring example of the lack of editorial control.

The article states;

"Development of The World has stalled in the wake of the global financial crisis, with all but one of the island owners completing construction".

It should read "with only one of the island owners completing construction"

Posted by: Realty check

Well spotted, Glen! It seems 'none but one' and 'all but one' mean the same to AB.

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