The Dubai Court of Cassation has issued an important judgment that significantly clarifies the jurisdictional boundaries between the Dubai Courts and the Rental Disputes Center (RDC) in disputes arising from the management of common property. In Commercial Cassation No. 53 of 2026, the Court reaffirmed that disputes concerning rights and obligations governed by Dubai Law No. (6) of 2019 on Jointly Owned Property fall within the exclusive jurisdiction of the Rental Disputes Center, regardless of how the parties characterize their contractual relationship.
The decision is particularly relevant for developers, owners’ associations, property management companies, facilities management companies, and legal practitioners involved in the real estate sector. It emphasizes that jurisdiction is determined by the true nature of the dispute and the governing legislation, rather than by the contractual labels adopted by the parties.
Background of the Case
The dispute arose from a Facilities Management Agreement executed on 23 September 2022 between the parties, under which one company agreed to provide integrated property management and maintenance services for the other’s real estate portfolio. The agreement was subsequently amended on 29 April 2024.
After providing services for more than two years, the service provider alleged that substantial invoices remained unpaid despite repeated demands for payment. The outstanding amount claimed exceeded AED 2.2 million, together with statutory interest and compensation for material and moral damages resulting from the alleged breach of contract. The claimant also sought judicial confirmation that the agreement had been terminated due to the employer’s breach.
A panel of accounting experts was appointed during the proceedings. Following the expert report, the Dubai Court of First Instance partially upheld the claim, ordered termination of the agreement, awarded approximately AED 1.41 million together with legal interest at 5% per annum, and granted AED 100,000 as compensation. Both parties appealed, and the Court of Appeal affirmed the first instance judgment.
The defendant subsequently challenged the judgment before the Dubai Court of Cassation.
The Central Legal Issue
Rather than focusing on the contractual obligations themselves, the Court of Cassation examined a preliminary issue of jurisdiction.
The principal question before the Court was whether a dispute arising from a facilities management agreement concerning common property should be heard by the Dubai Civil Courts or whether it falls within the exclusive jurisdiction of the Rental Disputes Center established under Dubai’s real estate legislation.
This jurisdictional issue became decisive because jurisdiction is considered a matter of public policy under UAE procedural law. Consequently, courts are required to examine jurisdiction on their own initiative even if neither party raises the issue.
Jurisdiction is a Matter of Public Policy
The Court reiterated a well-established principle that questions concerning subject-matter jurisdiction are matters of public order (public policy). Accordingly, every court has a continuing obligation to determine whether it possesses jurisdiction before addressing the merits of a dispute.
The Court further explained that judges are not bound by the legal characterization adopted by litigants. Instead, courts must independently determine the true legal nature of the dispute by examining the substance of the parties’ rights and obligations and identifying the applicable statutory framework.
This principle ensures that parties cannot confer jurisdiction upon a court merely by describing their claim as a contractual dispute where legislation allocates exclusive jurisdiction to a specialized judicial body.
Interpretation of Dubai Law No. (6) of 2019
The Court carefully analysed Dubai Law No. (6) of 2019 concerning Jointly Owned Property.
The judgment referred to several statutory definitions contained in Article 2, including:
- Common Property;
- Common Areas;
- Shared Facilities;
- Building Management System;
- Owners’ Committee;
- Service Charges;
- Usage Charges;
- Property Management Company; and
- Facilities Services.
These definitions demonstrate that the legislation creates a comprehensive legal framework governing the management, operation, maintenance and repair of jointly owned property within Dubai.
The Court also referred to Article 19 of the Law, which requires the principal developer to manage and maintain the common facilities through an approved management company under a written agreement approved by the Real Estate Regulatory Agency (RERA).
Most importantly, the Court relied upon Article 42 of Law No. (6) of 2019, which provides that the Rental Disputes Center has exclusive jurisdiction to hear and determine all disputes concerning the rights and obligations created under the Law and the regulations issued pursuant to it.
Substance Prevails Over Form
One of the most significant aspects of the judgment is the Court’s emphasis that legal characterization depends upon the substance of the dispute rather than the contractual description used by the parties.
Although the parties described their arrangement as a facilities management services agreement, the Court observed that the agreement concerned the management of common facilities within jointly owned real estate developments.
Accordingly, the dispute related directly to rights and obligations regulated by Dubai Law No. (6) of 2019.
Because the claim concerned payment for management and operation of common facilities governed by that legislation, the dispute necessarily fell within the exclusive jurisdiction of the Rental Disputes Center.
The Court’s Decision
The Dubai Court of Cassation held that both the Court of First Instance and the Court of Appeal had incorrectly assumed jurisdiction over the dispute.
The Court ruled that:
- the dispute falls within the legal framework established by Dubai Law No. (6) of 2019;
- jurisdiction belongs exclusively to the Rental Disputes Center;
- the ordinary civil courts lacked subject-matter jurisdiction; and
- the judgments of the lower courts therefore had to be set aside.