Picture for illustrative purposes only. ARCHIVE

Dubai-based lawyer Barney Almazar answers the most common questions regarding your legal options in various cases related to living and working in the UAE.

A reader asks: My sister invested in a trading company. During the first few months she was getting high returns, so my sister borrowed money so she can invest more. However, for the last six months, my sister was not getting any interest so she closed her accounts. To her surprise, the company demanded my sister to sign a new contract where it was stated that she will only get her money after 9-12 months. Her contract provides that she will be able to get her money back within 20 days only. What must she do? Atty. Barney says: She has to serve a demand letter to place the company in default pursuant to Article 272 (1) of the Civil Code as amended by Federal Law No. 1 of 1987. A lawyer will be able to assist you on this procedure. If the company is under financial distress, it will be highly advisable that your sister recover her investment the soonest—before the company losses all its funds. Remember, other investors are also claiming their investments and she would want to have a priority over them. Do not sign the new contract or the amendment as this will affect her existing rights to claim the principal investment and accrued interests plus damages. If the company does not settle despite the demand letter, she can open a collection case in the court.
This column also appears in the Expat Media Special Edition magazine. Do you have a question for Attorney Barney? Contact him at barney@gulflaw.info or know more about him here. Barney Almazar is a director at Gulf Law in the UAE, Philippines, UK and Portugal. He is a member of the Philippine Bar and holds a UAE legal consultancy license. He is listed by Thomsom Reuters as one of the Super 50 lawyers in the Middle East and North Africa. Asian Legal Business has ranked him as top lawyer in the Philippines, Southeast Asia and Middle East.
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