Am I li­able for my for­mer hus­band’s debts in the UAE? Q

The National - News - - BUSINESS MONEY&MARKETS - KEREN BOBKER

My ex-hus­band used to live in the UAE but left a short while ago and I be­lieve he left large debts be­hind. He left partly as he can’t pay them but also as he is se­ri­ously ill, so has gone home for treat­ment. I am con­cerned I might be held re­spon­si­ble for his debts, es­pe­cially as the di­vorce has not been fi­nalised. I don’t have the money to pay them but will the banks come af­ter me if he doesn’t make the re­pay­ments or dies? SN, Abu Dhabi

AUn­der UAE law, only the per­son whose name is on the debt, whether a mort­gage, per­sonal loan or credit card, is li­able for it. A hus­band or wife is only ac­count­able for a spouse’s debts if they are a guar­an­tor or handed over a se­cu­rity cheque to the bank.

While it is not un­com­mon for a bank to con­tact some­one with a con­nec­tion to a de­faulter, this must be in line with data pro­tec­tion rules and they can­not ask any­one else to re­pay an un­con­nected debt.

A legally mar­ried spouse is also not li­able for the UAE debts of their hus­band or wife.

Should a per­son die with out­stand­ing UAE debts, this would not be the re­spon­si­bil­ity of the sur­viv­ing spouse, but would need to be paid from the de­ceased’s UAE es­tate be­fore any other monies are passed to ben­e­fi­cia­ries.

I work in a UAE univer­sity and all the pro­fes­sors are on a two-year pro­ba­tion pe­riod. I thought the UAE Labour Law stip­u­lated six months as the max­i­mum. Are higher ed­u­ca­tion in­sti­tu­tions ex­empt from this rule? Fur­ther, how much no­tice am I legally re­quired to give if this twoyear pro­ba­tion is in­deed cor­rect? MM, Abu Dhabi

UAE Labour Law states that a pro­ba­tion­ary pe­riod can­not ex­ceed six months, per Ar­ti­cle 37 of the law, which clearly clar­i­fies this point. Note, how­ever, that this law does not ap­ply to every­one in the UAE. While free zones largely adopt these rules with few vari­a­tions, there are some spe­cific ex­emp­tions.

Ar­ti­cle 3 of this fed­eral law states: “The pro­vi­sions hereof shall not ap­ply to the fol­low­ing cat­e­gories: a) Em­ploy­ees and work­ers of the fed­eral govern­ment and the gov­ern­men­tal de­part­ments in the Emi­rates, mem­bers of the state, the em­ploy­ees and work­ers in pub­lic en­ti­ties and in­sti­tu­tions, whether fed­eral or lo­cal and em­ploy­ees and work­ers ap­pointed for gov­ern­men­tal fed­eral and lo­cal projects”. The ar­ti­cle goes on to men­tion other cat­e­gories.

Even though this is a govern­ment em­ployer, I would be very sur­prised if there is ac­tu­ally a two-year pro­ba­tion­ary pe­riod; per­haps it is ac­tu­ally a two-year fixed con­tract that has un­clear word­ing or has been mis­read.

MM should check the word­ing in her con­tract of em­ploy­ment as this should clar­ify the agree­ment she made with the em­ployer and the no­tice pe­riod re­quired. All em­ploy­ees should check the terms of em­ploy­ment care­fully be­fore stat­ing any job.

We bor­rowed money in Jan­uary 2017 from a loan shark, giv­ing our pass­port as a guar­an­tee. We were pay­ing in­ter­est un­til my hus­band lost his job. Now we ur­gently need the pass­port back as my hus­band wants to take ad­van­tage of the cur­rent amnesty as he has over­stayed on his visa. The loan shark does not want to re­turn the pass­port without us pay­ing back the full amount. What can we do now? EC, Dubai

It is never a good idea to bor­row money from an un­reg­u­lated and il­le­gal source like this. I am well aware this hap­pens as some peo­ple ei­ther do not earn a suf­fi­cient in­come to bor­row from a bank or they have al­ready ex­ceeded the of­fi­cial lend­ing limit.

Al­ter­na­tively they may be in the coun­try without a proper visa. But in any case loan sharks charge ex­tor­tion­ate rates of in­ter­est with no le­gal safe­guards, so this is a highly in­ad­vis­able route to take.

No one is per­mit­ted to re­tain some­one else’s pass­port; not an em­ployer, not a bank, and cer­tainly not a loan shark.

The first step here is to send them a let­ter point­ing out that it is il­le­gal to re­tain a pass­port, that it needs to be re­turned im­me­di­ately, and that fail­ure to com­ply will leave no choice but to go to the po­lice.

If the pass­port is not re­turned, EC and her hus­band will need to go to the po­lice. The fact an amnesty is in place and that the loan shark is pre­vent­ing them tak­ing the proper ac­tion that is avail­able should only as­sist with the case.

If money is bor­rowed, it should be re­paid and I am sure they are be­ing hassled but as the money was lent il­le­gally I un­der­stand that by law there is no “right to col­lect”, so the loan shark has no le­gal re­course. Even if an agree­ment was signed, it will not stand up in court as the per­son lend­ing the money has no right to charge in­ter­est.

Un­der the pe­nal code of the UAE, only a reg­is­tered bank or fi­nan­cial in­sti­tu­tion is per­mit­ted to charge in­ter­est on money that is loaned to an­other party.

Keren Bobker is an in­de­pen­dent fi­nan­cial ad­viser and se­nior part­ner with Hol­born As­sets in Dubai, with over 25 years’ ex­pe­ri­ence. Con­tact her at keren@hol­bor­nas­sets. com. Fol­low her on Twit­ter at @Fi­nan­cialUAE. The ad­vice pro­vided in our col­umns does not con­sti­tute le­gal ad­vice and is pro­vided for in­for­ma­tion only

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