What Is The Legal Validity Of A Rent Agreement?
The legal validity of a rent agreement (a tenancy contract) stands for its legitimacy and binding of its provisions for all its parties during the whole contract period or until certain circumstances occur. In other words, this means each of the parties has certain obligations to another party but also has the right to claim that party to fulfill their responsibilities and liabilities as well.
So, let’s discuss the peculiarities of tenancy contract legal validity in Dubai.
Is rent agreement registration mandatory?
In general, a tenancy contract gets its legal validity after both parties sign it. However, in Dubai, you must attest the contract to EJARI, a special government body that was established to validate rental relationships.
Did you notice our word choice? Not “Need”, not “Should”. But “Must”. And this is no coincidence. We deliberately used this word as rent agreement registration with EJARI in Dubai is not optional but mandatory. Such a requirement was introduced in the Law no.26 of 2007 and is still operative.
And this is not only about the aspect that without validating your contract at EJARI you can’t file a complaint in Rental Dispute Center to settle your tenancy disagreements. Fortunately, we have plenty of examples when no disputes occur during the whole tenancy period. So, this is about DEWA, a Dubai utility company, will not connect water and electricity unless you register your tenancy agreement.
Thus, rent agreement registration is really a must.
However, this requirement concerns only long-term leases. Typically, the long-term lease is the rental agreement with a tenancy period of six months and more. So, short-term contracts are not regulated by EJARY. Therefore, you don’t need to register the contract when its duration is less than half a year. (But note, unfortunately, in this case, you can’t apply to the Rental Dispute Center with your issues as well.)
Whose responsibility is it to register the agreement?
One only needs to look through the tenancy contract (which is unified as we all remember) to understand who is responsible for registering it. Definitely, its 14th item of Terms and Conditions says it is the landlord who undertakes to verify the contract at EJARI and provide with all required documents.
This means the landlord must personally visit one of the Real Estate Services Trustee centers and apply for EJARI registration, submitting all the documents and paying the fees.
Fortunately, if you sign a property management contract with BSO, we will relieve you of this time-consuming registration procedure. In other words, preparing all the papers and visiting the Service Trustees is not your worry as long as you entrust your apartment, villa, store, or any commercial property under our management.
What are the rent agreement registration charges?
As of September 2020, the total amount of EJARI registration is AED 220. This sum includes VAT and all the applicable Government fees.
- Lease registration fees – AED 155 (excluding VAT),
- Typing fees – AED 35 (excluding VAT),
- Knowledge + Innovation Fees – AED 20,
- VAT – AED 10.
What Happens if a Tenant Breaches a Rental Agreement?
Well, it depends. To be more specific, it depends on whether the tenancy contract was validated. In other words, whether you registered it or not.
As we discussed earlier, if you attest the lease to EJARI, the lease got its legal validity. In this case, the law protects you against your tenant malicious intentions and his neglecting contract provisions. That is to say, you can file a complaint to the Rental Dispute Center and resolve your dispute with its help.
Any contract breach from your tenant side is a violation of your rights as a landlord. Therefore, when you prove the fact of the breach, the decision is always on your side. The penalty against the tenant varies from financial penalties to eviction.
Note the cases for eviction are not only rent payment, subleasing, compliance with law and regulations issues. According to the article (25) of the Law no.33 of 2008, tenant failing to observe any terms, both standardized (read as mandatory) and additional, can be a cause for eviction as well.
However, if you neglect to verify the lease, the Rental Dispute Center will not even accept your case. Thus, if your tenant breaches the agreement, you will have to try to resolve the issue only on your own.
At BSO, we always ensure the legal validity of rental agreements we sign for the properties we manage. So, sign a property management contract with us. This way, you can be sure not only that your property is in good hands but that your landlord’s responsibilities are fully fulfilled without your personal involvement and your rights are fully protected.