Court cancels hotel unit deal after 13 property liens prevent ownership transfer.
Dubai: A Dubai Real Estate Court has ordered a developer behind a hotel unit in the The Heart of Europe project on the The World Islands to refund more than Dh1.37 million to an investor and pay an additional Dh150,000 in compensation after ruling that the property could not be transferred due to multiple legal attachments registered against it.
The court cancelled both the sale and purchase agreement and a related hotel management contract, finding that the developer failed to meet a fundamental obligation under the deal—transferring ownership of the unit to the buyer.
In its judgment, the Dubai Real Estate Court ordered the developer to repay Dh1,370,749.12, along with 5% annual legal interest from the date the lawsuit was filed until full payment is made.
The court also awarded the investor Dh150,000 in compensation, with interest accruing at 5% per annum from the date the judgment becomes final.
The dispute concerned a hotel unit purchased in the The Heart of Europe development, where the investor expected to generate returns through the property’s operation as part of a wider hospitality project.
Court records show the investor paid around Dh1.4 million for the unit. However, despite fulfilling all payment obligations, the ownership was never transferred, no title deed was issued, and the investor was ultimately unable to secure full legal control of the property.
According to court documents, the investor filed a lawsuit seeking to cancel a 2022 purchase agreement for a hotel unit, recover all payments made under the contract, and claim additional compensation and alleged investment returns totalling more than Dh2.24 million.
The claim also stated that the property was subject to undisclosed legal restrictions, including attachments and enforcement proceedings that had not been revealed at the time of purchase.
During the proceedings, the developer argued that the project had been completed, was operational, and had received all required approvals, including a five-star hotel classification. The defendants further maintained that the unit had been registered in the interim property register and claimed that investment returns had already been paid to the investor.
Documents submitted to the Dubai Real Estate Court included a Dubai Land Department interim sale certificate, project completion records, tourism approvals permitting guest operations, and hotel classification certificates.
The court, however, focused on property records submitted during the case, which revealed the existence of 13 legal attachments registered against the property. According to the judgment, the earliest attachment was recorded on February 19, 2024, while the most recent was registered on July 28, 2025. The developer did not dispute the existence of these restrictions.
The court held that these encumbrances made it impossible for the developer to transfer ownership of the property, describing the transfer of title as a core obligation under the sale agreement. The failure to fulfil this obligation amounted, in the court’s view, to a serious contractual breach justifying termination of the deal.
The court further ruled that cancellation of the sale agreement automatically invalidated the related hotel management contract, as it was contingent on the investor’s ownership of the unit.
It found that the investor had paid the full purchase price along with administrative and handover fees, but excluded Dh55,862.88 paid as a 4% Dubai Land Department registration fee, which was paid directly to the authority.
Accordingly, the court ordered a total refund of Dh1,370,749.12, covering purchase payments, handover fees, and administrative charges.
Claims that the investor had already received Dh320,048 in investment returns were rejected by the court due to insufficient evidence.
The court also found that the investor had been deprived of both the property and invested funds for an extended period, awarding Dh150,000 in compensation for damages.
In addition, it dismissed the case against the other defendants, ruling that there was no contractual relationship or evidence of fraud or personal liability.
The developer was further ordered to cover court fees, legal costs, and Dh1,000 in legal expenses.
