Picture for illustrative purposes only. ARCHIVE

The Dubai Civil Court has ordered an Arab man to repay Dh2 million he borrowed from a friend, ruling that the signed IOU constituted binding proof of debt and rejecting the borrower’s claim that the amount was only Dh1 million. According to court documents, the plaintiff lent the money in December 2024, with the defendant signing an IOU promising repayment within three months. Despite repeated reminders, the defendant failed to settle the debt, prompting the creditor to file a lawsuit seeking the loan amount plus Dh500,000 in damages for alleged lost investment opportunities. In his defense, the borrower admitted to taking a loan but argued that the real sum was Dh1 million, claiming he had already repaid Dh100,000. He also accused the plaintiff of attempting to impose “prohibited interest” and submitted WhatsApp messages as evidence. The court dismissed his claims, ruling that the signed IOU was conclusive evidence under UAE law since the defendant did not deny his signature. The court ordered him to repay the full Dh2 million, along with 5 percent annual interest from the date of the lawsuit until full payment. However, it rejected the Dh500,000 compensation claim, citing insufficient proof of financial loss. The ruling underscores the binding nature of written loan agreements under UAE law and serves as a reminder to parties engaging in informal financial transactions to formalize terms clearly. ICA/Expat Media
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