Limitless, a Dubai-based developer, is ordered by a UAE court to pay Dh411.9 million to Deyaar Development in a dispute related to the purchase of land.
The Court of Cassation ruled in favour of Deyaar, ordering cancellation of a sales and purchase agreement, as it rejected an appeal by Limitless against an earlier Court of Appeal ruling which was also in Deyaar's favour, according to a filing to the Dubai Financial Market, where its shares trade.
In addition to the Dh411.9m payment, the court also ordered Limitless to pay fees as well as compensation of Dh61.1m. The court also dismissed counterclaims filed by Limitless, according to the statement.
“The impact of the judgement on the financial position of the company and the expected period of the impact of the news on the financial statements depends on the date of the amount collection,” Deyaar said.
The company's shares rallied on the news, closing 4.6 per cent higher on Thursday at 38 fils per share.
In September, Deyaar said the Court of Appeal issued a judgement, confirming the judgement of Dubai Court of First Instance to terminate all sale and purchase agreements of the lands in dispute, and return all amounts paid by it in addition to the legal interest rate.
Established in 2005, Limitless is a sister company of Nakheel involved in planning large scale, mixed-use communities and waterfront developments, according to its website. The company declined to comment on Thursday's judgement.
Deyaar, on the other hand, is one of the larger listed real estate companies in Dubai and is currently building Midtown at Dubai Production City with an investment of Dh2.6 billion.
The company reported a 54 per cent decline in its third quarter net profit as revenues fell and expenses increased.
Net profit for the three-month period ending September 30 dropped to Dh16.3m and revenue slipped 4.1 per cent to Dh145.7m from the same period a year earlier, while expenses increased to Dh43.6m. The developer had total assets of Dh6.3bn.