Civil Law and UAE: Service Charges and Common Area Disputes

1. Introduction

Service charges and common-area disputes are a major category of UAE property disputes, particularly in jointly owned buildings, residential towers, mixed-use developments and master communities.

The central legal questions usually concern:

• who must pay service charges;
• how service charges are calculated;
• what expenses may legitimately be included;
• whether RERA or another competent authority has approved the charges;
• who is responsible for maintenance of common areas;
• whether a developer or management entity can recover charges from an owner;
• whether an owner can refuse payment because services are inadequate;
• whether unpaid charges create a lien over the unit;
• responsibility for charges accrued before a sale;
• distinction between unit maintenance and common-area maintenance; and
• the proper forum for challenging or recovering service charges.

For Dubai, the principal current framework is Law No. 6 of 2019 Concerning Ownership of Jointly Owned Real Property in the Emirate of Dubai. It defines service charges as annual charges for management, operation, maintenance and repair of jointly owned real property and establishes RERA approval, accounting, collection and dispute-resolution mechanisms.

Because property regimes differ between mainland Dubai, DIFC and other emirates, the cases below are identified by jurisdiction. DIFC cases are useful authorities on strata/common-property principles but should not be treated as binding precedents for mainland Dubai.

2. Meaning of Service Charges

A service charge is essentially an owner's contribution toward the costs associated with maintaining and operating jointly owned property.

Under Dubai Law No. 6 of 2019, these expenses include the management, operation, maintenance and repair of:

• common parts;
• common facilities;
• utility systems;
• security;
• cleaning;
• insurance;
• repairs;
• maintenance equipment;
• reserve/emergency requirements; and
• other approved costs connected with management and maintenance. 

The important point is:

Service charges are not simply an additional source of revenue for a developer or management company.

They are legally regulated contributions connected with the jointly owned property.

3. What Are Common Parts?

Dubai Law No. 6 of 2019 defines common parts broadly.

Article 7 includes, among other things:

• foundations;
• structural walls;
• columns;
• ceilings;
• roofs;
• staircases;
• entrances;
• emergency exits;
• swimming pools;
• gardens;
• certain parking areas;
• common equipment;
• electricity systems;
• water systems;
• heating and cooling systems;
• waste systems; and
• other common infrastructure. 

Therefore, a dispute may arise when an owner argues:

"This expense relates to my apartment and not the common property."

The legal classification of the relevant component becomes critical.

4. Who Must Pay?

Under Article 25 of Dubai Law No. 6 of 2019, an owner must pay the owner's share of annual service charges.

The share is calculated according to the approved methodology and is generally linked to the proportion of the unit's area to the total area of the jointly owned property. The law also requires developers to bear their share for unsold units, subject to the statutory and contractual framework.

Important consequence

An owner generally cannot say:

"I don't use the swimming pool, gym or garden, therefore I will not pay for them."

The obligation is attached to ownership and the jointly owned property regime rather than merely to an owner's individual use of each facility.

5. Tenant Versus Owner

Article 16 provides an important rule.

A unit may be leased, but unless the lease provides otherwise, the owner remains liable for service and usage charges.

More importantly, even where a lease transfers responsibility to the tenant, the owner is not automatically released from liability toward the relevant property-management structure if the tenant fails to pay.

Therefore:

Owner → statutory/property-law responsibility

Tenant → contractual responsibility under lease

These two relationships should not be confused.

6. RERA Approval Is Central

One of the most important protections in Dubai is that service charges cannot simply be invented by a management entity.

Article 27 provides that a management entity must obtain the relevant RERA approval before charging owners amounts for management, operation, maintenance or repair of common parts/common facilities.

The budget also requires certification by an audit firm recognised by RERA.

Therefore:

Invoice ≠ automatically legally recoverable service charge.

The underlying charge must satisfy the statutory and regulatory approval framework.

7. What Happens If the Owner Refuses to Pay?

Article 28 expressly provides that an owner may not simply refuse to pay service charges approved by RERA. The owner also cannot surrender an interest in common parts merely to escape the payment obligation.

But this does not mean that every amount demanded by a management company is automatically valid.

There is an important distinction:

Valid approved charge

Owner normally must pay.

Unapproved/illegally imposed charge

The owner may challenge its legal basis.

This distinction is extremely important in litigation.

8. Collection and Lien

Article 32 creates a powerful enforcement mechanism.

The management entity has a lien over the unit for unpaid service charges.

The law requires written notice and a 30-day payment period under the specified procedure. If payment is not made, the financial claim may be enforced through the execution judge of the Rental Disputes Settlement Centre (RDSC), and, where appropriate, the unit may be ordered to be sold by public auction to recover the charges.

Thus:

Unpaid charges → notice → enforcement → possible execution against unit.

9. Management Cannot Simply Lock Out an Owner

An important protection exists in Article 29.

A developer or management entity cannot take action preventing an owner from possessing or using the unit or common facilities merely to force payment of service charges in a manner contrary to the statutory procedures.

Therefore:

Debt recovery must follow the legally prescribed process.

A management company cannot necessarily invent its own enforcement mechanism.

10. Use of Service-Charge Money

Article 30 requires service-charge money to be maintained in a dedicated account.

The funds are restricted to legally permitted purposes, including:

• cleaning;
• security;
• safety;
• operation;
• maintenance;
• repairs;
• improvements to common parts;
• insurance;
• auditing;
• management-company fees;
• approved administrative expenses;
• emergency reserves; and
• other approved common-property expenses. 

This creates an important fiduciary-like accountability structure even though the precise legal character of the relationship depends on the applicable legislation and documents.

11. RERA's Supervisory Role

RERA has extensive oversight powers.

Article 33 permits RERA to:

• inspect jointly owned property;
• inspect common parts and facilities;
• identify violations;
• audit service-charge accounts;
• investigate complaints;
• review contracts with maintenance companies;
• require information and financial statements; and
• take action concerning defective management or maintenance. 

This means that a service-charge dispute is not merely a private contractual dispute between owner and management company.

It also has a regulatory dimension.

12. Maintenance of Common Areas

Article 35 deals with inadequate maintenance.

Where common parts or facilities are not properly maintained, RERA can require the management entity to undertake necessary repairs.

If the management entity fails to do so, RERA can appoint another entity and charge the costs to the relevant service-charge or usage-charge account in accordance with the law.

Thus, owners have a legal mechanism for addressing:

• defective lifts;
• damaged common areas;
• poor security;
• inadequate cleaning;
• defective shared systems;
• unsafe common facilities;
• failure to maintain building infrastructure.

13. Common Area Disputes

Common-area disputes usually fall into several categories.

A. Ownership dispute

Who owns the relevant area?

B. Use dispute

Who can use the area and for what purpose?

C. Maintenance dispute

Who must repair it?

D. Cost dispute

Who should pay for the repair?

E. Alteration dispute

Can an owner modify the area?

F. Access dispute

Can an owner or tenant be restricted from using the common facility?

G. Service-quality dispute

Are owners receiving the services for which they are paying?

14. Owners Cannot Treat Common Areas as Private Property

Article 17 prohibits the independent disposal or conversion of common parts into private property without the required approvals.

It also restricts alteration, redesign or closure of common facilities in ways that restrict owners' use without the necessary approvals.

Therefore, an owner generally cannot say:

"I purchased my apartment, so I can permanently appropriate part of the corridor, lobby or other common area."

The legal title to the unit does not automatically create exclusive ownership over common parts.

15. Alterations to Common Areas

Article 23 of the earlier Dubai jointly owned property regime and the current framework similarly regulate alterations affecting common property.

A unit owner or occupant cannot ordinarily make structural or external modifications that materially affect the unit or common property without the necessary approval.

Where damage is caused, the responsible owner may have to pay the repair costs.

This creates the principle:

Private ownership of a unit does not eliminate obligations toward the collective property.

16. Case Law

Case 1: Luciane v Leon [2020] DIFC SCT 117

This is a direct service-charge dispute.

The claimant sought approximately AED 30,957.12 in unpaid service charges covering eight quarters.

The dispute concerned the management entity's entitlement to invoice owners for service charges under the DIFC strata framework.

Principle

The existence of a statutory strata-management framework can create an enforceable contribution obligation against unit owners.

Importance

This is a useful example of:

ownership → statutory strata obligation → service-charge liability.

Jurisdiction: DIFC — not mainland Dubai.

Case 2: Lajesh v Laasya [2020] DIFC SCT 429

This case involved a claim for approximately AED 62,371.20 in alleged unpaid service charges.

The claimant relied on the strata management statement and its by-laws, which provided for contributions proportionate to unit entitlements for:

• administration;
• maintenance;
• management; and
• control of common property. 

The documents also distinguished common-property expenses from maintenance of fixtures and fittings inside individual units.

Principle

A crucial question in a service-charge dispute is:

Does the expense relate to common property or to the individual lot?

Importance

This case illustrates the boundary between:

common-area expenses

and

individual-unit expenses.

Jurisdiction: DIFC.

Case 3: Mikhru v Mimba [2023] DIFC SCT 380

The dispute involved responsibility for utility/service-related charges.

The Court considered Article 33 of the DIFC Leasing Law, which places certain service charges, including strata and master-community service charges, on the lessor by virtue of ownership.

The Court also considered whether a particular Empower demand charge constituted a capacity charge falling within the lessor's statutory responsibility.

Principle

The legal character of a charge matters.

A payment described commercially as a "utility charge" may legally constitute a service/capacity charge depending upon the applicable statute.

Importance

This is particularly useful when analysing:

• cooling charges;
• capacity charges;
• common-area utilities;
• landlord/tenant allocation.

Jurisdiction: DIFC.

Case 4: Salem Dwela v DAMAC Park Towers Company Ltd [2018] DIFC CFI 083

This dispute involved a sale-and-purchase agreement for a DIFC unit.

DAMAC counterclaimed for service charges and other amounts. The Court held that the service-charge claim was justified in principle under the contractual arrangements, while dealing separately with the precise amounts and other counterclaims.

Principle

Service-charge liability can arise from both:

• the applicable strata/property regime; and
• the contractual arrangements governing the unit.

Importance

A purchaser cannot necessarily avoid service charges merely because the purchase transaction itself remains disputed.

The precise date from which charges become payable can depend on the SPA, applicable law and relevant completion/handover obligations.

Jurisdiction: DIFC.

Case 5: Eshraq Investments PJSC v Shehab M. Gargash & Others [2021] DIFC CFI 077

The sale documentation expressly required the purchaser to contribute to the expenses incurred by the association for:

• maintenance;
• management;
• administration;
• control of the building and common property.

The service charge was calculated by reference to the relevant participation quota. The agreement also addressed a service-charge deposit.

Principle

Contractual documents can establish important details concerning:

• contribution obligations;
• service-charge deposits;
• payment dates;
• participation quotas.

Importance

When a service-charge dispute arises, courts may need to examine not merely the invoice but also:

• SPA;
• constitution;
• strata-management statement;
• by-laws;
• applicable legislation.

Jurisdiction: DIFC.

Case 6: Daman Real Estate Capital Partners Company LLC v Rohan & Others

DIFC property disputes involving DAMAC/Daman developments demonstrate the interaction between purchasers' contractual obligations and development-related obligations.

These authorities are particularly relevant where owners seek to resist payment by alleging:

• delayed completion;
• defective development;
• contractual breaches;
• failure to deliver promised facilities.

The important legal question is whether the alleged developer breach actually extinguishes or legally reduces an independently arising service-charge obligation.

Principle

A dispute concerning the developer's performance does not automatically mean that every service-charge obligation disappears.

The obligations must be legally connected.

Jurisdiction: DIFC.

Case 7: DAMAC Park Towers-related service-charge litigation

The broader DAMAC Park Towers litigation demonstrates that service-charge claims can continue even where the purchaser is simultaneously challenging the underlying sale transaction.

In Salem Dwela, for example, the Court considered the purchaser's claim for rescission/misrepresentation alongside DAMAC's counterclaim for service charges. The Court treated the claims separately rather than assuming that one automatically cancelled the other.

Principle

A property owner may have multiple simultaneous legal relationships:

sale contract + strata obligations + service-charge obligation + maintenance rights.

Each must be legally analysed separately.

17. Mainland Dubai Versus DIFC

This distinction is essential.

Mainland Dubai

The principal framework is:

Dubai Law No. 6 of 2019

with RERA/DLD and RDSC mechanisms.

Article 42 gives the Rental Disputes Settlement Centre exclusive jurisdiction over disputes concerning rights and obligations under that law and its implementing resolutions.

DIFC

DIFC has its own property/strata and leasing legislation and its own courts.

Consequently:

A DIFC case cannot automatically be cited as a binding interpretation of Dubai Law No. 6 of 2019.

It can nevertheless be persuasive or analytically useful for understanding common-property principles.

18. Service Charges After Sale of a Unit

One of the most difficult practical questions is:

Who pays old service charges when a property is sold?

Dubai Law No. 6 of 2019 gives the management entity a lien over the unit for unpaid charges.

This means the buyer must carefully investigate outstanding charges before completing the transaction.

The SPA may also allocate economic responsibility between buyer and seller.

Therefore, two separate questions should be distinguished:

Question 1

Who is liable to the management entity under the property regime?

Question 2

As between buyer and seller, who ultimately bears the economic burden?

Those questions may produce different answers depending upon the statute and contract.

19. Can an Owner Withhold Service Charges Because Maintenance Is Poor?

Generally, not automatically.

Dubai Law No. 6 of 2019 expressly prevents an owner from simply refusing approved service charges.

The proper approach is ordinarily to:

1. document the defect;
2. complain to the management entity;
3. involve the Owners Committee where applicable;
4. notify RERA where the matter falls within its regulatory authority;
5. challenge unlawful charges through the appropriate dispute mechanism.

The existence of defective services does not automatically create a unilateral right of set-off or non-payment.

20. Can Management Charge Anything It Wants?

No.

Article 27 is particularly important because it requires RERA approval before service/usage charges can be imposed.

Consequently, an owner challenging a bill should examine:

• RERA approval;
• approved annual budget;
• calculation methodology;
• unit area;
• service-charge rate;
• reserve allocations;
• supporting invoices;
• management agreement;
• master community declaration;
• building management regulation;
• audit documentation.

21. Common-Area Maintenance and Developer Liability

Service charges should not become a mechanism for transferring every defect to unit owners.

Dubai Law No. 6 of 2019 separately addresses structural defects and management/maintenance obligations.

Where the developer has a statutory or contractual responsibility for defects, the question may be:

Is this an ordinary maintenance expense or a developer's defect liability?

That distinction can be financially significant.

For example:

Ordinary maintenance

Replacing worn common-area lighting.

→ potentially service-charge expenditure.

Structural defect

Major structural failure caused by defective construction.

→ may engage developer/contractor liability rather than simply becoming an ordinary service charge.

22. Owners Committee

The Owners Committee plays an important governance role.

Under Article 24, it may:

• verify management of common parts;
• review annual maintenance budgets;
• request financial reports;
• discuss management difficulties;
• receive complaints;
• notify RERA where management fails to respond;
• report structural defects;
• coordinate safety and environmental matters. 

Thus, the committee is an important internal accountability mechanism.

23. Common Area Dispute: Typical Example

Suppose an apartment owner receives a bill for AED 40,000.

The bill contains:

• AED 15,000 maintenance;
• AED 8,000 security;
• AED 5,000 insurance;
• AED 7,000 reserve;
• AED 5,000 "management expenses."

The owner alleges that the management company has added unrelated developer expenses.

The legal analysis should be:

Step 1

Is the project governed by Dubai Law No. 6 of 2019?

Step 2

Is the management entity properly authorised?

Step 3

Has RERA approved the service-charge budget?

Step 4

Are the individual expenditure categories legally permissible?

Step 5

Were the charges properly calculated?

Step 6

Are the costs actually related to common property?

Step 7

Were they properly recorded in the service-charge account?

Step 8

What dispute-resolution mechanism applies?

Only then can the amount legally recoverable be determined.

24. Service Charges and Usage Charges

These should not be confused.

Service Charges

Generally relate to management, operation, maintenance and repair of the jointly owned property/common parts.

Usage Charges

Under Article 26 of Dubai Law No. 6 of 2019, a master developer may collect usage charges for management, operation, maintenance or repair of common parts in the master project, according to the approved methodology and Master Community Declaration.

Thus, a property owner may potentially encounter:

Building service charge + master-community usage charge

provided each has a lawful basis and appropriate approval.

25. Common Legal Defences in Service-Charge Litigation

An owner may potentially challenge a claim by arguing:

1. No RERA approval

The charge was never properly approved.

2. Wrong calculation

The unit area or contribution ratio is incorrect.

3. Wrong party

The claimant is not the legally authorised management entity.

4. Wrong expense

The expense concerns the private unit rather than common property.

5. Duplicate charging

The same expenditure has been charged twice.

6. Developer's responsibility

The cost concerns a defect that should be borne by the developer.

7. Lack of contractual/statutory basis

The charge has no valid legal foundation.

8. Procedural defect

Required notice or enforcement procedure was not followed.

But these are potential grounds, not automatic defences. The evidence and applicable property regime determine whether they succeed.

26. Common Legal Claims by Management Entities

A management entity may seek:

• unpaid service charges;
• usage charges;
• contractual interest where legally permissible;
• enforcement of a lien;
• execution against the unit;
• costs;
• other legally recoverable amounts.

Under Dubai Law No. 6 of 2019, the statutory enforcement process includes notice followed by enforcement before the appropriate execution judge.

27. Key Principles from the Case Law

The cases collectively demonstrate several principles:

Principle 1

Ownership of a unit can generate continuing service-charge obligations.

Principle 2

Common-property contributions are distinct from expenses relating exclusively to individual units.

Principle 3

The legal character of a charge matters more than the label placed upon it.

Principle 4

Contractual documents can supplement the statutory property regime.

Principle 5

A dispute about the sale contract does not automatically extinguish service-charge obligations.

Principle 6

The applicable jurisdiction must be identified before relying upon case law.

Principle 7

In Dubai, RERA approval is central to the legality of service charges.

Principle 8

Common-area disputes involve both private property rights and regulatory obligations.

28. Case-Law Revision Table

29. Important Statutory Provisions for Examination

For Dubai service-charge questions, remember:

Article 7

Common Parts

Article 16

Leasing and owner's continuing liability

Article 17

Disposition/use of Common Parts and Facilities

Article 24

Owners Committee duties

Article 25

Service Charges

Article 26

Usage Charges

Article 27

RERA approval

Article 28

Non-payment

Article 29

No improper prevention of use

Article 30

Service-charge account and permitted expenditure

Article 32

Lien and collection

Article 33

RERA audit and inspection

Article 35

Repair and maintenance

Article 42

RDSC jurisdiction.

30. Conclusion

Service charges and common-area disputes in UAE civil law involve a combination of property law, contract law, regulatory law and dispute-resolution principles.

In Dubai, Law No. 6 of 2019 establishes a detailed statutory structure: owners contribute to approved service charges; common parts are collectively regulated; RERA supervises and approves charges; service-charge funds are subject to restrictions; management entities have enforcement rights for unpaid charges; and RDSC has jurisdiction over disputes under the law.

The case law, particularly the DIFC decisions such as Luciane v Leon, Lajesh v Laasya, Mikhru v Mimba, Salem Dwela v DAMAC Park Towers and Eshraq Investments v Gargash, demonstrates recurring principles concerning the relationship between ownership, common-property obligations, contractual documents and service-charge liability.

The most important distinction is:

An owner cannot ordinarily avoid a valid approved service charge simply by refusing to use a facility, but a management entity also cannot automatically recover every amount it chooses to label a "service charge."

Quick Revision Formula

Common Property → Owner's Contribution → RERA Approval → Proper Accounting → Maintenance → Statutory Collection → Lien/Enforcement → RDSC Dispute Resolution

Core principle:
Valid service charge = lawful basis + approved budget/charge + correct calculation + common-property purpose + proper procedure.