A recent judgment by the Rental Dispute Settlement Centre (RDC) of the Dubai Land Department has upheld that the dismissal of an employee (also the tenant and Plaintiff in this case) from his job qualifies as an “Exceptional Circumstances” event and therefore, justifies the termination of his lease contact with his landlord (the Defendant).
The RDC confirmed in its judgment that a lease contract may be terminated in two cases, either by applying the principle of “force majeure” or the application of the theory of “Emergency Circumstances” which cannot be prevented or expected at the time of contracting. This is a significant finding as the termination of employment is deemed to meet the criteria for “Exceptional Circumstances” events as per UAE law and is ultimately considered grounds for the termination of the lease contract with no penalty for early termination being imposed on the tenant.
The RDC in its judgment stated the following:
“The RDC is of the view that the termination of the Claimant is an event of emergency circumstances, which the Claimant cannot mitigate nor predict. The lease has become burdensome to the tenant to the extent that it is impossible to continue with the lease agreement.”
We are happy to support you with your real estate and rental disputes and litigation matters. For further information, please reach out to one of the contacts below or your usual Baker McKenzie contact.