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Sun 25 Oct 2009 12:31 PM

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Tenants face eviction over landlord dispute

Families set to find out on Sunday if they will lose homes after paying rent to firm that was not landlord.

Thirty eight families will find out later on Sunday if they are to be evicted from their homes in Discovery Gardens after paying a year’s rent upfront to a brokerage firm which turned out not to be the landlord.

The tenants of building 219 in Moghul cluster say they are scared to leave their homes to go to work in case the locks are changed and they cannot get back in.

One month after paying AED45,000 for a one-bedroom flat to Corporate Business Solutions (CBS) they discovered the building is actually owned by Meraas Real Estate.

Meraas has filed a case against CBS, but the firm is believed to have closed down and the owner disappeared.

Rent Committee General Secretary Mohammad Ahmad Al Shaikh told Arabian Business on Sunday the tenants would have to approach CBS to claim the money back.

“They rented from someone who did not own the property. If they want to continue living there they can deal with Meraas and will have to file a case against CBS to get their money back,” he said.

One tenant said: “I can’t concentrate at work anymore. It’s always on my mind what’s going to happen. There’s no peace. I feel horrible.”

“We’ve got all the possible proof that we’ve gone through the correct process. We’ve done nothing wrong, yet it’s most likely that we’ll be evicted,” she added.

Her husband said: “We’re scared at work that someone is going to come and change the locks so we can’t get back in.”

Dubai Rent Committee is set to deliver its final verdict on Sunday. Two earlier hearings were held on October 4 and 18.

The tenants say they rented the flats through property agents Palma Real Estate, Imperial Real Estate and Homeland, all registered with Dubai Real Estate Regulatory Authority (RERA).

Palma has since offered to pay tenants back their AED2,250 commission if they sign a letter absolving the firm of any liability and preventing any “action, transactions or decisions done or taken during dealings with CBS.”

Sarah Derbas, Palma marketing manager, told Arabian Business: “To be honest, that’s all we can do. We can’t offer them anything else.

“We told the Land Department and RERA about it and we need them as an authority to deal with this. We were tricked as well.”

Tenants said they managed to register their contracts with RERA and Dubai Electricity and Water Authority (DEWA) and at no point was the authenticity of the contract questioned.

“For them it’s an apartment, but for us it’s a home,” another tenant told AB.

The father who has a three-month-old baby son said: “There’s no one here who can afford that. We are salaried people who don’t have that kind of money to move about Dubai.

“If there was one alarm raised we would have not gone through with this, but there never was. As far as we were concerned CBS were the landlords.

“What is the process to follow because we thought we were doing the right thing?”

A spokesperson for RERA told Emirates Business: "Tenants mostly use rental companies to rent units and they should ensure that the company is licenced and handles rental brokerage.

"Before signing the cheque, a tenant should ask for title deed and must ask the owner to register the contract with the agency.”

Arabian Business tried to call CBS, but the office number was constantly engaged and the mobile number of owner Alejandra was out of service.

Hardly. 9 years ago

This is absolutely sickening. Whilst the individuals could have gone to better lengths, some of this has to fall on the Real Estate Agents. They are registered as a proffesional body and charge based on 'services rendered'. It should be part of their Service to check if the property is genuine... Another example of an issue the government needs to step in on. This is a real real shame.

richard 9 years ago

Tenants must be listened to,

Jessica 9 years ago

This falls 100% on the real estate companies that rented the units. It's ridiculous to blame the tenants. They were leasing from legitimate real estate agents that were registered who should have checked out who they were doing business with. The tenants are complete victims actually of two parties.

Simon 9 years ago

A little known fact but one which the tennants should exploit and demand action. Real Estate Brokers are NOT by LAW allowed to lease/rent apartments as a part of their activity as stated in their Trade Licences. They all do but its illegal...unless they have lodged a AED5,000,000 bond at the Dubai Economics Department (DED). Everyone will say this isn't true...but it is. Check at the Economics Dept and they will confirm the same. RERA know it bu never enforces the law. I would imagine that only 3 large Real Estate Brokers in Dubai have this activity on their trade licenses and have lodged the AED5,000,000 bond. How do I know...because I have tried 3 times to put the activity on my trade license and each time i have been met with a request for AED5,000,000 bond. I don't have AED5mil there my company doen't have the legal capacity to do lease/rental business therefore we don't. A standard Real Estate Brokerage license does not give that brokerage, under the law, to conduct leasing or rental business. I'd be happy to hear from other agents who believe it does...other than those that say of you can because we've done it for years. Point me to a part of your brokerage license that tells me the activity exists. It doesn't because you have to apply for it...and thats where the bond keeps coming up...

Navin 9 years ago

I'm really saddened by what the tenants are having to endure and I honestly wish I could for once see these unscrupulous scam artists being brought to justice and made an example of. Unfortunately, its something RERA just doesn't have on its agenda. I think we're failing to address a bigger problem here. Why are these entities STILL being allowed to operate? Why hasn't an example being made of anyone of them? With is the "REGULATION" that RERA is supposed to provide? Honestly, if I could do some investigative journalism for Arabian Business to expose these entities and bring them to justice then bring it on. I'm sick of the very people fueling this economy treated as if they were unwanted refugees. RERA, its time you stepped it up and made your existence worthwhile.

Naveen Shetty 9 years ago

The incident is very sad and shows the apathy of the regulators in Dubai real estate. All the agencies which were involved in registering the Tenancy Agreement and provided utilitiy services are at fault. The Tenants are not the people who should be approching the CBS, its the duty of the Meraas to file a case against CBS. As you know...anything can happen in Dubai. If this is not handled properly it will tarnish the image of the regulators as it clearly shows that it is a agency without tooth,

Nigel 9 years ago

"Rent Committee General Secretary Mohammad Ahmad Al Shaikh told Arabian Business on Sunday the tenants would have to approach CBS to claim the money back. “They rented from someone who did not own the property. If they want to continue living there they can deal with Meraas and will have to file a case against CBS to get their money back,” he said." What is the purpose of RERA if not to protect consumers from fraud? The RERA registration process is clearly broken else these victims would not be in the situation they are. 1. RERA is responsible for this and therefore should cover the transfer of contract to legal owner then seek to recover costs from the alleged fraudster. Only RERA has the necessary resources to do this. 2. An action plan should be developed and published by RERA articulating exactly how they will prevent such fraud impacting innocent consumers in future. Without these two basic remedies RERA is a waste of time and should be closed down. This is exactly the type of story that gets high profile press in the anti-dubai western media. No-one living here wants that so please, RERA, stand up and take responsibility.

Hamid 9 years ago

Shameful I strongly believe the real estate agents are fully responsible in this regard. They are the professionals, and they must have checked all of these documents. The problem is that we have thousands of “brokers”, who have no qualification to be one. Brokers must be knowledge, liable, accountable, and bound with codes of ethics. Many of these supposedly “Brokers” are nothing but referral service, but charging thousands dirham’s of broker fees without providing any service. I feel very bad for these people, who at no fault of their own have sustained such loss. These people seem to be hard working people, who really must not go through this

Cash Flow Messiah 9 years ago

Being able to register DEWA & RERA in this case is one thing bewildering by itself. I'm wondering, if CBS was not the real owner of the apartments, how did they get the keys to all the apartments to give to the tenants??

AJ 9 years ago

Here's a possibility - The original owner had some sort of property management agreement with a secondary party. Basis the agreement, original owner hands over property docs/possession & apartments keys to secondary agent to deal with the tenants directly. So, everything was more or less legitimate, possibly. Secondary party then leases all units with payments to themselves. There's a fall-out between original owner & secondary party, probably due to non-payment from secondary party. Original owner now wants all tenants out. Just a thought.