The Dubai Court of Cassation has upheld a final ruling convicting a family heir of repaying Dh34 million from estate assets, concluding a dispute spanning nearly two decades.

The case dates back to 2006, after the death of the family patriarch. One heir took control of the family's holding group and real estate portfolio. A later financial review uncovered a shortfall of Dh34 million (about 9.2 million US dollars).

Court findings revealed that the heir had taken out personal loans against estate assets, engaged in buying and selling properties for personal gain, entered into undisclosed joint ventures, and collected commissions from real estate transactions without informing the other heirs or distributing the profits.

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An independent audit commissioned by the court confirmed the financial misconduct. The Dubai Court of First Instance convicted the heir of breach of trust and embezzlement, a verdict later upheld by both the Court of Appeal and the Court of Cassation.

To safeguard the estate, the court appointed a custodian to oversee and manage the assets while the case was under review.

Khalid Farooq, Senior Partner - Advisory at Resilice Chartered Accountants and Advisory Services, who reviewed the records, stated:

“The court's decision reflects the scale of financial mismanagement uncovered. While the ruling covers transactions worth Dh34 million, the total civil claim could be larger, as revenues and dividends were never distributed over the years.”

Farooq added that the case highlighted the importance of corporate governance in family businesses, noting:“Families should not rely solely on trust. Regular audits, transparent reporting, and clear profit distribution policies are essential to avoid disputes of this magnitude.”

He also pointed out that cases involving guardianship and inheritance can sometimes place minors in vulnerable positions. When they reach legal age, they may be asked to sign documents confirming they have received all their dues from a guardian.

Khalid cautioned that such situations should be approached carefully.“A lot of times, minors are made to sign these documents once they come of age, but they may not be fully aware of the legal consequences,” he said.“It is always advisable for them to seek independent legal advice before signing anything to ensure their rights are fully protected.”

In 2023, Dubai's Special Court of Inheritance settled over Dh4.1 billion worth of inheritance cases, demonstrating the city's commitment to resolving such disputes efficiently. The court handled 580 cases, including 512 Muslim estates, 38 non-Muslim estates, and 30 private estates. Remarkably, the success rate of inheritance settlements reached 92.6 per cent, surpassing the target of 90 per cent.

This high success rate underscores the effectiveness of Dubai's judicial system in managing complex inheritance matters. It also highlights the importance of proper documentation and transparency in asset management, principles that were central to the case in question.

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