Settlement Of Disputes Arising From The Execution Of Contracts For The Construction Of Citizens' Homes In The Emirate Of Dubai

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In line with the wise directives of the Government of Dubai to enhance the efficiency of the legislative system and adopt alternative dispute resolution mechanisms...

United Arab Emirates Real Estate and Construction

In line with the wise directives of the Government of Dubai to enhance the efficiency of the legislative system and adopt alternative dispute resolution mechanisms, His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, issued Law No. (8) of 2025 concerning the settlement of disputes arising from the execution of contracts for the construction of citizens' homes in the Emirate of Dubai, which will come into force on January 1, 2026

This law aims to establish an effective and fair mechanism to resolve recurring disputes in this vital sector, ensuring the protection of citizens' rights, continuity in project implementation, and the reduction of delays that negatively affect the timely handover of housing.

1. Objectives of the Law

This law seeks to achieve several key objectives, most notably:

Establishing a fast and alternative mechanism for resolving disputes prior to resorting to the judiciary
Enhancing the stability of contractual relationships between citizens, contractors, and engineers, even in the event of disagreements.
Ensuring timely execution and delivery of housing projects without disruption.
Promoting a culture of amicable settlements and alternative dispute resolution methods in the construction sector.

2. Dispute Resolution Branch

The law establishes a "Branch of the Center" under the umbrella of the Center for Amicable Settlement of Disputes, which shall be responsible for examining and resolving disputes arising from the execution of contracts for the construction of citizens' homes, provided the dispute value does not exceed AED 10 Million. These include:

Variation orders, discrepancies in material prices, and quantity schedules.
Withheld payments after the issuance of the completion certificate.
Maintenance, design, and supervision works, and the respective responsibilities of the contractor and engineer.
Delays in completion, and design or execution errors.

3. Cases of non-jurisdiction

The Branch of the Center shall not have jurisdiction in the following cases:

Disputes arising after the end of the maintenance period and final handover.
Claims that cannot be settled amicably under applicable legislation.
Disputes where the government or its affiliated entities are a party.
Labor claims or cases already pending before the courts or other competent authorities.

4. Adjudication of Dispute

If no amicable settlement is reached, the dispute shall be referred to a specialized committee known as the "Construction Disputes Adjudication Committee," which must decide the matter within 30 days (extendable), issuing a reasoned decision that shall constitute an enforceable instrument unless challenged within the legal period.

The decisions of the committee are subject to the following rules:

They may be appealed before the competent Court of First Instance within 30 days.
Execution of the decision shall be stayed pending a final court judgment.
If no appeal is filed within the legal deadline, the decision becomes enforceable pursuant to the Civil Procedure Law.
A petition for reconsideration of the decision may be submitted after the expiration of the appeal period, in accordance with the cases and time limits stipulated in the Civil Procedure Law, as well as in the event of a nullity related to the notification, provided that it is submitted to the committee that examined the dispute or issued the contested decision.

5. Suspension of Limitation Periods

One significant effect of this law is that the filing of a dispute before the Branch of the Centre suspends the running of the limitation and prescription periods, which shall resume from the date of completion of the conciliation phase or referral of the dispute to the committee.

6. Comment by Senior Advocate / Jaber Al Ameeri:

In light of the rapid urban expansion in the Emirate of Dubai and the resulting notable increase in disputes related to contracts for the construction of citizens' homes, the issuance of this law represents a qualitative leap in promoting the principle of expedited justice. It provides a flexible and swift legal framework that balances the protection of citizens' rights with the stability of relationships with contractors and engineers. The establishment of a dedicated body to resolve these disputes reflects the legislator's keenness to address the unique nature of such conflicts and accelerate the handover of homes without compromising the rights of all parties involved.

Conclusion

Law No. (8) of 2025 stands as an advanced model for activating judicial alternatives and expediting dispute resolution procedures. It contributes to the stability of the real estate sector and offers legal protection for citizens in one of the sectors most closely tied to family and community needs.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.