Misrepresentation

Misrepresentation occurs when a party to a property transaction makes a false statement of fact (not opinion) that induces the other party to act. It can be fraudulent (deliberate lie), negligent (careless disregard for accuracy), or innocent (genuinely believed to be true). In real estate, common examples include overstating rental income, concealing structural defects, misrepresenting the unit size, or falsely claiming a property has certain approvals.

Under UAE civil law, a buyer who has been misled by material misrepresentation can seek contract rescission (voiding the deal), compensation for losses, or a price adjustment. RERA can also take action against licensed brokers who misrepresent properties, including fines, licence suspension, or revocation. Buyers should document all representations made during the sales process and verify key claims independently.

Misrepresentation claims require demonstrating that a false statement was made, that you relied on it, and that you suffered loss as a result. Proving reliance is often the hardest element. Courts will ask whether a reasonable buyer would have relied on the representation or would have conducted their own independent verification. Strong due diligence before purchase both reduces the risk of relying on misrepresentations and, if misrepresentation is discovered, demonstrates that you acted reasonably.

The distinction between statement of fact and statement of opinion matters legally. A seller who says "this building is the best-managed in the area" is expressing an opinion, not a fact, and cannot be held liable for misrepresentation if it proves untrue. A seller who says "the service charges are AED 15,000 per year" when they are actually AED 25,000 has made a false statement of fact.