The Dubai Inheritance Court has taken an unconventional step in addressing debt-ridden estates by adopting a new methodology aimed at safeguarding the rights of creditors and the interests of heirs simultaneously. This new approach, supported by the leadership, highlights the court’s commitment to providing innovative solutions to ensure fair settlements for all parties involved.
Judge Mohammed Jassim Al-Shamsi, the head of the court, explained that the court now relies on appointing an expert to develop a comprehensive plan for managing debt-ridden estates that cannot be sold or liquidated. Under this plan, accumulated debts are scheduled, and the plan is then presented to creditors, who accept it as long as they are assured of receiving their full rights within an appropriate timeframe. Al-Shamsi noted that this step falls into three categories of estates: ordinary, bankrupt, and debt-ridden. In the latter case, debts are settled first, and what remains is distributed to the heirs. However, this may require unconventional procedures in certain large cases.
The court’s new methodology works by calculating the annual income of the estate compared to the debts and then devising a repayment plan that is presented to the creditors, with some agreeing to wait three to four years to receive their rights. This plan is currently being implemented with two large estates, and creditors have agreed to the new approach. In this scenario, efforts are focused on managing and operating the estate’s assets instead of selling them, providing all parties with an opportunity to receive their rights while protecting the assets from loss.
In another context, Judge Al-Shamsi emphasized that the Dubai Inheritance Court has achieved tangible results since its establishment in 2023. Among its notable accomplishments, the court has successfully settled inheritance disputes worth 2.3 billion AED, and amicably resolved 626 properties. Additionally, the court managed to complete 68% of inheritance cases in just 11 months, with a 71% approval rate for initial rulings.
These results serve as evidence of the court’s success in providing innovative and flexible solutions for handling large and complex estates, contributing to the enhancement of the social and economic impact of the legal actions taken.
