Sunday 20 March 2016

Changes introduced to keep UAE debtors out of jail

The former engineer had a company that exported and imported materials for construction. It collapsed in 2008 and his partners fled with the money.

“I filed cases against them but they left the country,” J A said. He was released from prison in March this year, after being sentenced to three years in jail.

“The judge wouldn’t listen,” he said. “All he asked was that if it was my signature on the cheques. He didn’t ask me about the circumstances or the money I was owed.”

J A owed more than Dh2 million to several banks.

“I can’t give this money back. Everything was sold and for half the price I paid. The police want to arrest me. My wife has left me and taken the kids and I don’t blame her. I am like a dead man,” he said.

He is wanted by the police to appear at civil court and will be jailed unless he pays his debts.

ABU DHABI // Mediation is to be introduced to reduce the number of people sent to prison and time served in civil cases over debts or bounced cheques.

Debtors in civil cases will have ready access to a judge without having to wait for a hearing, which also means fewer cases clogging up the courts. And those few who are eventually jailed over debts will not serve a day longer than their sentence.

“All they are required to do is to send in a request and a judge will meet them regardless of the date of their hearing,” said one judge, who asked not to be identified.

“We will have a separate registrar so that their cases are monitored to ensure that no one spends a day longer than his sentence in prison. Now we will always know the numbers in prison and where they are so we can reach them immediately.”

The judge said jail was considered a last option: “It is only for those who intentionally do not want to pay. Any person who shows the slightest intention to pay off their debts is given several chances to do so. If they even pay some of the amount or, for example, show us an offer letter from an employer and a bank that’s willing to reschedule their loans – just any proof or any seriousness to repay the debt – then we assist them in doing so.”

Under the process, the judge will determine a time of between 15 days and six months to pay the debt, based on the debtor’s situation. If after this they have not paid or given the judge a convincing plan of how they can, they will be arrested if the creditor insists.

However, during the hearings the judge will ask both sides how the debt can be settled. He will then decide to grant the debtor a grace period to settle their debt or be jailed for a month at most.

After that month, the debtor appears before the same judge and is again asked if they can pay, has a way of doing so, or if someone can sponsor him.

If none are available they will be jailed again for one month.

This is repeated for a maximum of six months. After that, the debtor is released for at least 90 days to find a solution.

There are no arrest warrants against them and they can be issued with a certificate of good conduct if they have no other pending cases.

“Civil cases do not influence such a thing or related to a certificate of good conduct,” the judge said. “People with pending civil cases are eligible for employment. Civil sentences are not a punishment and not registered on a person’s record or considered prior convictions.”

It is only if the person does not appear for their court date and has no reasonable solution to pay off their debt that an arrest warrant is issued.

After 90 days have passed and still the debtor has no means to even partially settle their debt or placate the creditors, the process is repeated and they can be jailed for another six months.

But the judge said that no person was to be in jail for more than 36 months – no matter how many cases or plaintiffs. “So if a person has any number of cases, all from different parties, then they can’t be arrested for more than this period.”

Those who have served time in prison for debt believe the current system must be changed.

“We are broke and there is no way we can pay the money we owe. All our assets have already been sold and no one will hire us,” said Tariq Al Jenaidi, who owed about Dh1.8 million to banks and suppliers.

“The arrest warrants makes it impossible for them to find employment. I’m not sure to whose benefit it is to arrest us. We can never pay the people we owe so long as we are in jail and it must be a burden and a cost on the Government to keep us in jail.”

Mr Al Jenaidi was jailed for more than 12 months last year after his contracting company was forced to shut down in 2012 after the global financial crisis.

He was released in March this year for a month to pay off his debts or be sent back to prison. “How am I expected to do that? The banks won’t settle if I don’t have a steady income.”

Mr Al Jenaidi applied for dozens of jobs after his release and passed all the initial interviews.

“As soon as they do a background check and find out that I have a case against me, they reject me. I can’t get a certificate of good conduct because I am wanted by the police.”

Lawyer Mohamed Alzaabi said it would help if the court could write off of the misdemeanour from the offender’s record while they were paying their debts.

The judge said more than 20,000 civil cases were filed each year, with fewer than 200 people jailed.



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