How to shut down a loss-making firm when a partner is missing

■ We are three partners in a limited liability company. For two years, the third partner has been outside the UAE and we do not know his whereabouts. This partner owns 60 per cent of the shares. The company is suffering losses, but we cannot shut it down due to his absence. What are our options?

File a lawsuit to liquidate the company even in the absence of the 60 per cent shareholder. This might be done in case of the loss of all or most of the assets of the company, in such a manner that renders the investment, or the remainder thereof, not profitable. According to Article 308 of the Federal Decree-Law No. (32) Of 2021 on Commercial Companies, if the losses reach three quarters of the capital, the partners holding one quarter of the capital may request to dissolve the company.

Moreover, according to Article 678 of the Civil Transaction Law, any interested party may apply to the court to appoint one or more liquidators to carry out the liquidation and partition the company. There are also decisions taken by the Dubai Higher Court of Rights Cassation No. 271/2002. The liquidation shall be based on its request, or the request of one of its partners. It shall be liquidated by taking an inventory of its assets, stating its rights and obligations, and dividing the money from the liquidation among the partners in proportion to the capital share, so he gets his share of the profit and bears his share of the loss.

The court may, according to Article 676 of the Civil Transaction Law, on the demand of a partner, dissolve a partnership if a partner shirks his obligation, or damages the partnership through his management.

Errant contractor

■ Two years ago, I received my villa from the contractor who built it. However, the roof of the villa is leaking, in addition to other defects. The contractor refuses to fix the problems on the pretext that the defect warranty expires one year from the date of delivery of the villa. What is the position of the law on this?

You have the right to file a case against the contractor within three years from when the destruction took place or was discovered as he is liable for 10 years or a longer agreed period, to indemnify the master of work for total or partial destruction and for every defect endangering the solidity and security of the building.

This is stated in Article 880 of the Civil Transaction Law, unless the two parties agreed that these constructions are meant to stay for less than 10 years.

This obligation to indemnify shall remain in effect even if the defect or the destruction is due to a defect in the ground itself, and even if the master authorised the erection of the defective buildings or fixed constructions. The 10-year period shall start as of the time of delivery of the work.

If the architect’s work is limited to the preparation of the plans without being entrusted with the execution, he shall be responsible only for defects in the plans. Any clause tending to exonerate or limit the warranty of the contractor or the architect is void.

Court action on the warranty may not be heard after three years from the occurrence of the destruction or the discovery of the defect.