Ask the law: Can property purchase contract be cancelled if project is delayed

A property purchase contract can be cancelled if the project is delayed. Photo for illustrative purpose only

Question: Four years ago, I bought a property from a developer and paid 80 per cent of the property value. Currently, however, building completion is only 30 per cent. The developer asked me via email to pay the instalment, otherwise the contract will be cancelled and all my payments will be lost according to the developer. My question is, am I legally entitled to file a real estate lawsuit to cancel the purchase contract and recover all payments and also claim compensation?

Answer: You have to check the completion date agreed upon in the purchase agreement and the payment plan whether it is connected to the completion date or not because this agreement governs the relationship between the developer and the buyer. You have to pay the instalments as per the agreement.

The law doesn’t allow the developer to be late forever or as much as he finds it suitable. The contract shall be implemented, according to the provisions contained therein and in a manner consistent with the requirements of good faith. In the event the date agreed on to complete the property is due and the landlord did not yet finish it, you can file a suit in front of the civil court to cancel the purchase agreement. You can also ask to return back your money and request for compensation because in bilateral contracts, if one of the parties does not perform his contractual obligations, the other party may, after serving a formal notification to the debtor, demand the performance of the contract or its rescission.

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Additional time

The judge may order the debtor immediate performance of the contract or grant him specified additional time, as he may order rescission with damages, in any case, if deemed justified.

In the event the completion agreed date is not due yet and taking into consideration that the completion percentage is only 30 per cent, then you have the chance to file a suit in front of the court leaving the matter to the court to estimate whether the landlord is late or not from the situation and documents submitted as per what is stipulated in Dubai Courts that “to assess whether the seller has been late in the implementation of his contractual obligations, and that this delay amounts to what leads to the buyer’s response to the request for the termination of the contract or not, and the assessment of the corresponding binding obligations of the two sides is one of the issues of reality that is related to the court of subject matter.”