Groundhog day: Locked out over unpaid service fee…again?

Groundhog day: Locked out over unpaid service fee…again?

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Kipp has an eerie sense of déjà vu, as reports emerge of residents on another development of the Palm being denied access to their property over unpaid service fees, yet again.

May 22, 2012 3:44 by Eva Fernandes

When we read about the recent developments on the Palm, Kipp had to double check our calendar-because we felt sure it was December 2011. Like those residents of the Shoreline Apartments who were denied access into their apartments over unpaid service charges at the end of last year, this week, residents of the Golden Mile apartments on the trunk of the Palm were prevented from entering their apartments by security guards. Cars were backed up leading up to the entrance of the building, where security guards stood checking tenants name against a list. The debacle only ended two hours later when the residents called the police.

The comments of British tenant Jo Parker best captures the issue at hand: “Security tried to stop me driving in but I drove past the cones. This is ridiculous. If there is a dispute, they can’t penalize tenants. We’re paying our rents. We can’t be locked out of our apartments.”

Kipp’s said this before and we will say it again, the issue of unpaid service fees is essentially a dispute between the landlords and developers which should be resolved in the court of law—not through a development’s security guards. If Dubai is genuinely serious about re-establishing itself as an attraction for real estate investors, then considerable attention needs to be given to ensuring the legal framework reflects the level of sophistication the market is now at. Of course, some leeway has been made by the introduction of the strata law-but more needs to be done and it needs to be done much quicker. After all, only last week was it reported ‘the first building in the emirate to be run by homeowners‘ was set to launch its owners association. Note the tentative ‘to be launched’ in the sentence.

The longer Dubai holds out to enforce a legit framework for owner’s association, the more damage is done to Dubai’s realty reputation. Kipp, for one, would never want to invest in a development that may or may not shut out our paying tenants on account of unpaid service fees.

And apart from the PR-blunder, shutting people out from their own apartments is indeed illegal. Consider these words from property lawyer Ludmila Yamalova: “As per the federal law, the definition of freehold ownership is an unencumbered and absolute right to use your property as you see fit,” he said. “Under the Dubai strata law, the recourse possible against defaulting owners is only through a civil case by the owners’ association and not by the association manager or the developer.”

This doesn’t come as a shock to Kipp-after all we very closely followed and covered the entire messy affair just six months ago. That the folks over at Golden Mile haven’t cottoned on or more like, chosen to imitate the events at the Shoreline, speaks only to the lack of protection the realty laws provide tenants and landlords here in Dubai.