Case Summary:
In this partial commercial lawsuit, the plaintiff sought to terminate a vehicle sale contract and recover the paid amount (AED 149,000), along with compensation of AED 20,000 for damages and losses incurred. The plaintiff alleged that the vehicle was subject to fraud and misrepresentation, as its specifications differed from those stipulated in the agreed-upon contract.
Plaintiff’s Requests:
- Termination of the Sale Contract: Recovering the vehicle’s value due to contractual fraud.
- Refund of the Paid Amount: Demanding the return of AED 149,000, which was paid as the vehicle’s value.
- Compensation: Claiming AED 20,000 for damages incurred to the vehicle.
- Legal Interest: Demanding 9% interest from the date of the claim until full payment.
- Litigation Costs: Charging the defendant with all expenses, including attorneys’ fees.
Case Facts:
- The plaintiff purchased a vehicle from the defendant via a specialized public auction for supported vehicles.
- It was discovered that the vehicle had been involved in a major accident and contained parts from older vehicles, making its specifications inconsistent with the agreed contract (model year 2020).
- Technical reports and inspection certificates were attached, confirming significant technical and electrical defects.
Court’s Ruling:
- Fraud and Misrepresentation: The court dismissed the plaintiff’s allegation of fraud or misrepresentation affecting the contract’s validity. The court highlighted that the plaintiff purchased the vehicle in a public auction and should have exercised due diligence, such as hiring an expert to inspect the vehicle before purchasing.
- Contract Validity: The court affirmed the validity of the contract and its essential elements, noting that no legal flaws or defects in consent were proven.
- Dismissal of the Claim: Based on the presented evidence and the expert’s report, the court dismissed the case and ordered the plaintiff to bear all litigation costs, including attorneys’ fees.
Legal Analysis:
- Application of the Law: The court referred to the provisions of the UAE Civil Transactions Law (Articles 534, 536, and 540), which outline the seller’s obligations regarding hidden defects and liability for fraud. The Evidence Law was also invoked to clarify the distribution of the burden of proof between the parties.
- Purchasing Procedures: The ruling emphasized the buyer’s responsibility to take necessary precautions in auctions, thereby exonerating the defendant from liability.
- Pacta Sunt Servanda Principle: The court stressed that a valid contract, free from defects in consent, is binding on both parties unless proven otherwise.
Conclusion:
The judgment reflects the UAE judiciary’s emphasis on caution and adherence to legal procedures when entering into contracts. This decision underscores the importance of parties being fully aware of contractual mechanisms, particularly in transactions involving technical complexities.
For Further Assistance:
For detailed legal consultations on terminating sales contracts due to fraud and misrepresentation or claiming damages, contact us today.
References:
- UAE Civil Procedures Law (Decree-Law No. 42 of 2022).
- UAE Civil Transactions Law.
- Dubai Courts official website.