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A homeowner who successfully sued a subsidiary company of Emaar Properties PJSC for a whopping AED3.36m ($915,663.10) over breach of contract has revealed he’d be more than happy to purchase a property from them again.
Brassed-off Spaniard Carlos Jose Periera, 46, felt he was left with no other option than to take Mrasem LLC, part of Emaar Properties PJSC Group, to court after the purchase of his dream Dubai holiday home turned sour.
He paid about AED3m ($800,000) for a villa at the Warsan Estate in the summer of 2009. But Dubai’s property market crumbled under the strain of the devastating world economic crisis and the agreed completion date of October, 2010 for the villa came and went with nothing in sight.
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After verdict was passed by the Dubai Court of Cassation last year, Periera received the sum of AED2,927,978.70 – the purchase price of the villa - plus 9% interest in compensation on 20 December, 2011.
But despite all the problems he encountered, Periera says he will use the cash won to buy another holiday home in Dubai … and fully intends on taking hold of the keys to another Emaar property.
“Sure, why not?”, Periera exclusively told ConstructionWeek.
“The first option for me when I purchase my future property in Dubai will be Emaar.
“They are big – it is impossible for them to disappear with my money.
“If the seller of the villa was another tiny company, sure my lawyers might win the case, but I’m 90% sure I would not recover the money.
“My recommendation for any other investors would be deal with big, serious and well established companies.
“They will offer guarantees in case you go to court that other tiny companies cannot offer.”
Periera, from the Basque country in northern Spain, has a younger brother Jose, 39, who also bought a similar villa at the Warsan Estate in Dubai.
But Periera says he bears no grudges against either Emaar or Dubai for the way his dream holiday home move was handled – insisting the brothers’ love for the emirate has not been diminished by the ensuing legal wrangle.
“We run an e-commerce business, where our company imports goods from other countries and sells them across Europe, mainly in consumer electronics,” said Carlos.
“One of our providers is from Dubai and he kindly invited us to visit and we accepted.
“We had heard about Dubai before on TV but when we arrived it was even more spectacular than expected and we decided Dubai was the perfect place to spend our holidays.
“It has excellent food and is very secure, so we decided to purchase a pair of villas, one for Jose’s family and one for mine.
“Our friend and provider in Dubai told us the Warsan project was a good opportunity to purchase. He told us Emaar is a big, serious company and we decided to sign the purchases.”
But then, after the deal was signed for the villa on 7 July, 2009, things started to go wrong.
“The problem was that we heard that the Warsan project was on-hold and they were issuing credit notes or moving money to other projects which were finished or near to finish,” said Periera.
“We decided to travel to Dubai and visit the Emaar offices and ask them about the possibility of changing the money from the Warsan project to a Burj Khalifa apartment.
“But the conditions they gave us to do so were unacceptable.
“They were only willing to allow us to change our money to a pre-defined list of projects which didn’t interest us.”
Feeling frustrated and believing Emaar’s subsidiary group Mrasem LLC was in breach of contract, Periera decided the only option was to take legal action.
“They never contacted us (again) after our visit to the Emaar offices.
“As we saw no solution, we decided to contact The Legal Group in Dubai and go to the courts, because we thought they had broken the purchase agreement.”
A hearing for breach of contract which began at Dubai Court of Cassation in March, 2010 was decided in Periera’s favour in April last year.
With his compensation cheque finally presented to him just five days before Christmas, it brought a much needed dose of festive cheer.
“I don’t know why Emaar did not fulfill their obligations,” said Periera.
“My opinion is that Emaar and a lot of constructors in Dubai were victims of speculators.
“The Warsan project was 100% sold only a few hours after the start of its sale.
“The next day, a lot of resellers were offering the villas.
“Then, when the crisis appeared and speculators didn’t sell the villas, they had no money for second installments and stopped payments.
“When Emaar saw the reality of the situation – in that only a few investors like us were continuing to pay installments on time - the project became non-viable.
“It’s my opinion that if all the people who signed a purchase agreement had met their payment obligations, then this summer I’m sure I would be in my Warsan Estate villa.”
Periera, however, says he feels entirely compensated by the Dubai Court of Cassation’s verdict – and will re-invest in the Dubai property market “as soon as it is stable.”
“No other place in the world offers me the peace and security that Dubai does,” said Periera.
“Emaar is a big company, very important in Dubai.
“Though they appealed all the decisions, the case passed through all the courts - first instance, appeal, cassation – and I have to say, the Dubai courts system is very fast. They do a great job.”
However, Carlos warned Emaar ahead of any future dealings : “We understand Emaar as company - they have to protect their company and investors’ interests - but if Dubai wants quality tourism, they have to differentiate between serious purchasers that love Dubai, and speculators.
“I think they should have enough tools to know who is who.
“Emaar should have protected us and other serious purchasers, offering us different options to solve the problem.”
A spokesperson for Emaar was unavailable for comment when contacted by ConstructionWeek.
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