October 03, 2022 SCT - JUDGMENTS AND ORDERS
Claim No. SCT 290/2022
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
In the name of His Highness Sheikh Mohammed Bin Rashid Al Maktoum,
Ruler of Dubai
IN THE SMALL CLAIMS TRIBUNAL OF DIFC COURTS
BEFORE H.E. JUSTICE MAHA AL MHEIRI
BETWEEN
LEELANS
Claimant/Counter-Defendant
and
LONTAS
Defendant/Counter-Claimant
| Hearing : | 22 September 2022 |
|---|---|
| Judgment : | 3 October 2022 |
JUDGMENT OF H.E. JUSTICE MAHA AL MHEIRI
UPON this Claim being filed on 27 July 2022
AND UPON the Defendant’s Acknowledgment of Service and Counterclaim being filed on 3 August 2022
AND UPON a Second hearing having been listed before H.E Justice Maha Al Mheiri on 22 September 2022, with the Claimant’s representative and the Defendant in attendance
AND UPON reading the submissions and evidence filed and recorded on the Court file
IT IS HEREBY ORDERED THAT:
1. The Claimant shall pay the Defendant the sum of AED 23,332.
2. The Security Deposit in the amount of AED 6,250 shall be forfeited in favour of the Claimant and the Defendant shall pay the Claimant the amount of AED 320, unless she exercises her right under this Judgment to hire an external contractor to carry out the items that she is liable to repair by no later than 17 October 2022.
3. The Claimant shall pay the Defendant the Court filing fee in the amount of AED 1,166.60.
Issued by:
Hayley Norton
SCT Judge
Date of issue: 3 October 2022
At: 3pm
THE REASONS
The Parties
1. The Claimant is Leelan (the “Claimant”), the landlord of unit 001 DIFC, Dubai (the “Premises”).
2. The Defendant is Lontas (the “Defendant”), an individual leasing the Premises.
Background and the Preceding History
3. On 15 August 2020, the Claimant and the Defendant entered into an agreement to lease the Premises for one year (the “Lease Agreement”), starting from 15 August 2020 to 14 August 2021. The parties later renewed the Lease Agreement for another year ending on 14 August 2022 (the “Renewed Lease Agreement”).
4. The rent agreed between the Claimant and Defendant for the Lease Agreement was AED 125,000, to be paid in 1 cheque. The Defendant paid the full amount for the rent and AED 6,250 as a security deposit (the “Security Deposit”) for the Premises. The Defendant paid the Claimant the amount of AED 140,000 for the Renewed Lease Agreement.
5. The Defendant experienced a number of issues with the Premises, including a bad odour emanating from the air conditioning unit (the “AC Unit”), mould, and lack of hot water, in addition to other maintenance issues.
6. On 9 July 2022, the Defendant’s lawyer served a legal notice upon the Claimant notifying the Claimant of the breaches that he had carried out, in his capacity as the landlord of the Premises, and his failure to abide by the terms and conditions of the Renewed Lease Agreement and the relevant provisions of the DIFC laws (the “Legal Notice”).
7. Further to the Legal Notice, the Defendant attempted to negotiate a settlement with the Claimant but was unable to do so.
8. On 27 July 2022, the Claimant filed a claim with the DIFC Courts Small Claims Tribunal (the “SCT”) seeking an order that the Defendant vacate the Premises upon expiry of the Renewed Lease Agreement, and to hand over the Premises to the Claimant in good condition.
9. On 3 August 2022, the Defendant filed a counterclaim (the “Counterclaim”) seeking the following relief:
(a) the claims against the Defendant be dismissed;
(b) the Claimant refunds the security deposit in the amount of AED 6,250 to the Defendant on the expiration of the Renewed Lease Agreement;
(c) the Claimant compensates the Defendant with 5 months’ rent amounting to AED 58,333l
(d) the Claimant pays the Defendant’s legal and other costs of these proceedings;
(e) such other costs as the SCT may assess based on the unreasonable behavior of the Claimant in respect to the remedy sought under RDC 53.79(2); and
(f) such further or other relief as the tribunal deems appropriate.
10. The parties met for a Consultation with SCT Judge Delvin Sumo on 16 August 2022 but were unable to reach a settlement.
11. In line with the rules and procedures of the SCT, this matter was referred to me for determination, pursuant to a Second Hearing held on 22 September 2022, with the Claimant’s representative and the Defendant in attendance.
The Claim
12. The Claimant’s case is that he entered into the Renewed Lease Agreement with the Defendant for a 1-year period, from 15 August 2021 to 14 August 2022, for AED 140,000.
13. The Claimant is seeking an Order for the Defendant to vacate the Premises upon the expiry of the Renewed Lease Agreement and to return the Premises in the state that it was leased. On 15 August 2022, the Claimant provided the Defendant with a snag list setting out a list of the defects found within the Premises that allegedly occurred during the Defendant’s occupancy of the Premises (the “Snag List Dated 15 August 2022”). The Defendant accepted some items on the Snag List Dated 15 August 2022 and denied the rest arguing that the items fall under wear and tear, and the other items were already present when she leased the Premises.
14. The Claimant seeks the amount of AED 10,574.50 which reflects the total cost for rectifying the defects identified within the Snag List Dated 15 August 2022.
15. In reply to the Counterclaim, the Claimant sets out the following allegations against the Defendant:
(a) delayed maintenance reporting which caused damage to Premises;
(b) failure to provide maintenance as required by a landlord;
(c) delays to accept maintenance visits scheduled by the Claimant; and
(d) refusing multiple maintenance visits.
16. The Claimant refutes the Counterclaim and maintains its position that he seeks an order from the Court that the Defendant return the Premises in the state it was originally leased and denies the Counterclaim.
The Defence and Counterclaim
17. The Defendant vacated the Premises on 14 August 2022. The Defendant argues that she cleaned and painted the Premises, and returned it to the state that it was originally leased.
18. The Defendant asserts that she has taken all steps necessary to vacate the Premises in the same condition as it was first obtained two years earlier, other than fair wear and tear.
19. The Defendant also argues that the Premises was vacated in “great condition” and any works listed under the Snag List Dated 15 August 2022 are either as a result of fair wear and tear or an attempt by the Claimant to give substance to claims filed 15 days prior to vacating the premises in anticipation to any breach or damage to the property that may occur upon date of inspection.
20. In her Counterclaim, the Defendant alleges that the Claimant had breached the terms and conditions of the Renewed Lease Agreement by failing to attend to maintenance in a timely manner and by prolonging the process by requesting several quotes in order to reach the best price to perform the maintenance works.
21. The Defendant argues that when she raised urgent complaints to the Claimant that required major maintenance repairs, such repairs where not handled quickly.
22. The Defendant submits that she also raised a complaint with regards to the condition of the AC Unit to representatives of Luvit and Limat (the “Agents”), and informed them that the AC Unit was hazardous to her health and safety as it was growing mould. Evidence of this correspondence has been provided to the Court.
23. The Defendant also informed the Agents of her allergies to the dust that had accumulated in the Premises and insisted that the AC Unit needed be fixed and for the mould to be effectively treated, however, this issue which was only addressed after several months.
24. Even then, the Defendant claims that the mould was only addressed in the air ducts, and the mould continued to grow in the living room and the master bedroom as it had not been properly treated.
25. Further, the Defendant claims that the constant opening and examining of the AC Unit attracted more dust in the Premises, worsening her allergies, as also evidenced under the Defendant’s medical report.
26. The Defendant’s position is that had the source of odour been examined from 15 months ago, as initially reported, the Defendant would not have been exposed to such unhealthy environment and conditions.
27. The Defendant submits that as a result of the Claimant’s and the Agents’ failure to effectively address the Defendant’s concerns within a timely manner she has suffered emotional distress and endured concerns regarding her health and safety due to the delay and/or lack of repair to the various material defects and maintenance issues.
28. Further, the Defendant notes that the maintenance companies have prepared reports based upon the Defendant’s complaints and inspection of the Premises and have attested to the issues arising due to the congestion of the pipes and poor conditions of the AC Units as a result of which the mould has spread over the walls.
29. The Defendant provided the Court with WhatsApp communication between herself and the Claimant’s representative to demonstrate her attempt to schedule an appointment to fix the issues.
Discussion
30. First and foremost, the relevant Amended Lease Agreement is in relation to a unit in the DIFC, therefore, by default, any agreement shall be governed by the prevailing law of the DIFC, United Arab Emirates and that upon failure to resolve any disputes connected to the Amended Lease Agreement, the dispute shall be referred to the DIFC Courts. Therefore, it is clear and undisputed that the DIFC Courts have jurisdiction to decide this matter. As the claim value is less than AED 500,000, this claim is properly before the SCT.
The Claimant’s Claim
The Snag List Dated 15 August 2022
31. The Claimant provided the below Snag List Dated 15 August 2022 setting out items for the Defendant to rectify:
| Item | Area in Apartment Unit | Cost of Repair Work in AED | Responsibility |
|---|---|---|---|
| 1 | Cooker Glass need to clean with buffing and cleaning 300 Defendant | 300 | Defendant |
| 2 | All door and side edge cleaning, repairing and apply silicon | 150 | Claimant |
| 3 | Painting needs to be done | 120 | Defendant |
| 4 | Filing creaks repairing and apply silicon | 200 | Claimant |
| 5 | Bathroom door edge repairing and missing skirting installation | 225 | Defendant |
| 6 | Bed side shelve re-fixing | 120 | Claimant |
| 7 | Wall corner repairing and painting | 300 | Claimant |
| 8 | Inside bathroom re-grouting | 180 | Claimant |
| 9 | Bathroom washbasin counter need removing mark and polishing | 550 | Defendant |
| 10 | Bathroom ceiling creaks Filing and repainting | 300 | Claimant |
| 11 | Livingroom curtain broken | 150 | Defendant |
| 12 | All steps marble re-fixing with marble glue | 300 | Claimant |
| 13 | Full sofa cover replacement | 4,500 | Defendant |
| 14 | Kitchen Cabinet lock missing | 75 | Defendant |
| 15 | Broken Fridge box replacement | 900 | Defendant |
| 16 | Kitchen room floor trap cover replacement | 100 | Defendant |
| 17 | Curtain side area creaks repairing and painting | 200 | Defendant |
| Total | 8,670 | ||
| VAT | 433.50 | ||
| Total with VAT | 9,103.50 | ||
32. The Claimant provided two snag lists in support of his claim. The first list was produced on 26 September 2020, being the date when the Defendant first leased the Premises (the “First Snag List”) and the second snag list, i.e. the Snag List Dated 15 August 2022 was produced when the Claimant vacated the Premises. The Snag List Dated 15 August 2022 was prepared following an inspection of the Premises, held in the presence of the Defendant and a representative of the Claimant (the “Inspection”). Following the Inspection, the Claimant notified the Defendant that there were a few items that needed fixing before the Defendant would return the security deposit. The Defendant accepted that she needs to clean the carpets (an item not documented on the Snag List Dated 15 August 2022) and she also responsible for items 13 and 15 above.
33. The Court after comparing both snag lists has reached the below conclusion, that the Defendant shall be responsible for items 1, 3, 5, 9, 11, 13, 14, 15, 16, and 17 in the amount of AED 6,570, plus vat. The Defendant may hire an external contractor to carry out the repairs or agree to pay the amount set out by the Claimant in respect of these items, being the amount of AED 6,570, plus vat. In the event the Defendant wishes hire an external contractor to carry out the repairs, she may do so by no later Monday, 17 October 2022. Failure to fix the above list will result in the Security Deposit being forfeited in favour of the Claimant, in addition to the Defendant paying the Claimant the amount of AED 320.
Counterclaim
5 months compensation
34. Pursuant to Clause 23 of the Renewed Lease Agreement, it is stated that,
“Major maintenance is the sole responsibility of the Landlord including the Chiller charges. Major maintenance is described as maintenance on the structure of the building and include but is not exhausted by work required to the roof, drainage, major plumbing, electrical, including maintenance for private swimming pool pumping equipment where present, and A/c. Minor maintenance is the responsibility of the Tenant. Minor maintenance is described as maintenance on leaking faucets and exposed pipes in the kitchen, laundry, toilers, faulty locks, fused light blobs, A/c filter cleaning etc. In the event that the property is under the Developers Warranty, the tenant may attempt to seek recourse for such warranties. (Tenant is responsible for the cost of minor maintenance for up to AED 500/-, while the Landlord is responsible for the cost above AED 500/-.”
35. Therefore, pursuant to the aforementioned provision of the Renewed Lease Agreement, I find that that major maintenance works falls under the sole responsibility of the Claimant, in his capacity as the landlord of the Premises.
36. Further, pursuant to Article 38(1) of the DIFC Law No. 1 of 2022 (the “DIFC Leasing Law”), it is stated that,
“A Lessor must ensure that Residential Premises are maintained in good repair”
37. In addition, and in accordance with Article 14 of the DIFC Leasing Law “a Lessor must take all reasonable steps to ensure that the Lessee has quiet enjoyment of the Leased Premises during the term of a Lease.”
38. Therefore, pursuant to the aforementioned provisions of the DIFC Leasing Law, the Claimant is required to ensure that the Premises is maintained in good repair and is also required to take all such reasonable steps in order to ensure that the Defendant has quiet enjoyment of the leased Premises during the tenancy period.
39. After review of the parties’ submissions, the Court is satisfied that the Claimant has been negligent in his role as a landlord to ensure that the Premises has been maintained in good repair. Although the Claimant sent maintenance teams to attempt to resolve the issues within the Premises, it is apparent that the root of the problem was not addressed, and the problems continued to reoccur throughout the Defendant’s tenancy.
40. In his submissions, the Claimant argues that the Defendant failed to immediately report the issues within the Premises which resulted in the problems worsening. It is noted by the submissions, that the Defendant, upon the discovery of the defect and maintenance issues within the Premises raised the complaints with the Claimant and the Agents, however, fundamentally, the Agents do not have the final call in approving the maintenance request and such approval can only be provided by the Claimant.
41. I also find that the complaints raised by the Defendant have not been fully addressed and there have been substantial delays over consecutive months in obtaining approvals as well as the execution of arrangements in order for the major maintenance works to be carried out. Although it is noted that, on occasion, the delay was caused by the Defendant, the majority of the problem falls from not solving the root of the defect.
42. As a result of the above, the Claimant has failed to ensure that the Defendant has quiet enjoyment of the leased Premises and benefit of the Premises during the term of the lease, thereby breaching Articles 14 and 38(1) of the DIFC Leasing Law.
43. I will not list the defects and maintenance recommendations that the Premises requires throughout the duration of the lease but it should be noted that the parties’ submission have been taken under full consideration.
44. In light of my findings above, it is ordered that the Claimant pay 2 months’ rent as compensation for the poor quality of maintenance provided to the Premises throughout the duration of the Lease.
45. The Claimant shall pay the Defendant the amount of AED 23,332 as compensation for the short comings of the maintenance support needed during the term covered by the Lease Agreement and the Second Lease Agreement.
46. The Defendant also seeks to recover the fee that was paid to the Court for the filing of this Claim. I am of the view that, although the Claimant has been unsuccessful on some of its claims. As such, the Claimant shall recover the percentage from the amount rewarded.
Conclusion
47. In light of the aforementioned, I find that the Claimant shall pay the Defendant AED 23,332 as compensation for failure to attend to maintenance properly.
48. The Security Deposit in the amount of AED 6,250 shall be forfeited in favour of the Claimant and the Defendant shall pay the Claimant the amount of AED 320, unless she exercises her right under this Judgment to hire an external contractor to carry out the items that she is liable to repair by no later than 17 October 2022.
49. The Claimant shall pay the Defendant the amount of AED 1,166.60, being the filing fee applicable to Claims awarded.
