How a Real Estate Lawyer in Dubai Handles Service Charge Disputes

A real estate law attorney can review RERA-approved charges, payment records, management duties and enforcement steps before a service-charge dispute affects the property.

For many property owners, service charges remain a routine expense until the amount increases, a payment is disputed or an outstanding balance begins to affect a sale. In Dubai, service charges for jointly owned property are governed principally by Law No. 6 of 2019 Concerning Ownership of Jointly Owned Real Property in the Emirate of Dubai.

A dispute cannot be assessed from an invoice alone. The approved budget, registered unit area, payment history, account statements and formal notices may all be relevant. For owners, developers and investors, the key question is whether the amount demanded and the steps taken to recover it comply with the applicable Dubai property rules.

Start With the RERA-Approved Budget

Service charges are amounts collected from owners to meet the costs of managing, operating, maintaining and repairing jointly owned property.

A Management Entity cannot simply determine an annual figure and demand payment without regulatory approval. The service-charge budget must be approved by the Real Estate Regulatory Agency, and the prescribed audit process must be completed before approval.

An owner should therefore compare the demand against the approved budget for the relevant year and check how the charge has been allocated to the unit.

Dubai Land Department also provides access to approved service-charge information through its systems. This can be an important first step before instructing a real estate lawyer in Dubai to examine whether there is a genuine calculation, approval or enforcement issue.

Check How the Owner’s Share Was Calculated

Law No. 6 of 2019 links an owner’s share of service charges to the area of the unit recorded in the Real Property Register and the approved calculation method.

The registered area can therefore become important where an owner believes the amount has been calculated incorrectly. Title documents and official property records should be checked against the figures used in the demand.

An approved budget may cover expenses such as security, cleaning, maintenance, common-area utilities, insurance, management costs and reserve funding where applicable.

The question is not simply whether an expense exists. It is whether the expense falls within the approved framework and has been properly allocated. Real estate law firms handling these disputes may need to review both the property records and the financial breakdown before advising on the next step.

Who Pays When the Property Is Leased?

As a general rule, the owner remains responsible for service charges.

A tenancy agreement may place responsibility for payment on the tenant. However, the owner is not released from liability to the Management Entity if the tenant fails to pay.

For landlords, this means the tenancy agreement should be reviewed together with the tenant’s payment history and any outstanding account statements. A contractual obligation between landlord and tenant does not remove the owner’s statutory exposure to the Management Entity.

Unpaid Charges Can Affect a Property Sale

Outstanding service charges can also create problems during a property transfer.

Law No. 6 of 2019 gives the Management Entity a lien over the unit for unpaid service charges. The law also provides that the unit may not be disposed of until the outstanding charges are paid.

Before a transfer proceeds, any outstanding balance subject to the statutory lien should therefore be identified and settled.

A buyer, seller or investor instructing lawyers in Dubai should also check whether the amount claimed was properly approved and whether the account accurately reflects previous payments.

A Dispute Does Not Automatically Allow Payment to Be Withheld

This is an important point for owners.

Article 28 of Law No. 6 of 2019 provides that an owner may not refrain from paying service charges that have been approved by RERA.

A disagreement over calculation, management performance or the use of funds should therefore not be treated as an automatic right to withhold a RERA-approved amount.

The dispute and the payment obligation may need to be addressed separately. Where there is concern about an incorrect demand, the approved budget, registered unit area, payment records and available complaint or dispute procedures should be reviewed promptly.

Non-Payment Can Move Into Enforcement

If an approved amount remains unpaid, the Management Entity must follow the prescribed enforcement process.

The owner must be served with a written notice approved by RERA. The law provides a period of 30 days from service of that notice for payment.

If payment is still not made, the financial claim may become enforceable before the execution judge at the Rental Disputes Center under the applicable procedures.

The consequences can be significant. Where necessary, the competent execution judge may order the unit to be sold by public auction to recover unpaid service charges.

An owner should therefore not ignore a formal notice simply because the amount is disputed.

Management Entities Also Have Legal Duties

The owner’s payment obligation does not remove the Management Entity’s responsibilities.

Service-charge funds must be paid into the prescribed account for the jointly owned property, and the law regulates how those funds may be used. Management Entities are also responsible for the operation and maintenance of common parts within the scope of their statutory duties.

RERA has supervisory and audit powers over the management of jointly owned property.

This means a service-charge dispute may involve more than whether an owner has paid. It may also require review of the approved budget, financial records, management conduct and the way common areas are being maintained.

The Role of Owners Committees

Where constituted under the applicable project category, Owners Committees also have defined functions.

Their role may include reviewing budgets, receiving complaints, reporting defects and making recommendations concerning management and maintenance.

The composition and powers of an Owners Committee can vary depending on the category of jointly owned property. It is therefore important not to assume that every development has the same management structure.

Where the dispute concerns building management rather than only an unpaid invoice, advocates and legal consultants in Dubai may need to review the project classification, Management Entity responsibilities and the available complaint route.

Conclusion: Review the Dispute Before It Affects the Asset

Service-charge disputes are easier to assess before enforcement begins or a pending transfer creates additional pressure.

A real estate law attorney can compare the title information, approved budget, statement of account, payment history and notices to identify what is properly due and whether there is a legal basis for challenging any part of the demand or process.

For property owners and investors dealing with top law firms in Dubai or other property advisers, the objective should not be to avoid a lawful charge. It should be to ensure that the amount demanded, the process followed and any enforcement action are supported by the applicable law and approved records.

If a service-charge demand, management dispute or pending transfer is creating legal or financial risk, AY Advocates can review the relevant documents, applicable Dubai property rules and the available course of action.

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