How do you handle a situation when someone owes you money

Khaleej Times

10-07-2025

Lending money to a friend in need can seem like the right thing to do, but what happens when they can't pay it back? It can quickly lead to a fallout, animosity and the threat of calling in lawyers then court.
The most frequent debt-related cases tend to fall into a few main categories: personal loans (between friends, family, or acquaintances), unpaid invoices, credit card or bank debt, and rent arrears (tenants not paying landlords), according to Musaab Ali Alnaqbi Advocates and Legal Consultants. In the UAE, post-dated cheques also come up a lot. If someone issues a cheque that bounces, it can quickly turn into a criminal or civil case.
Lawyers typically get involved at three stages: Pre-litigation (negotiation phase) which can involve drafting a legal notice and initiating settlement talks. Next you have the litigation phase — filing a civil claim, attending hearings and enforcing judgments. Finally, there's the post-judgment phase which includes collecting the debt via court enforcement (e.g., freezing bank accounts, seizing assets). 'It's often smart to consult a lawyer early — even before sending a demand letter — to ensure it's worded properly and legally sound,' said Adv. Ibrahim Khaleel, Managing Partner at Musaab Ali Alnaqbi Advocates and Legal Consultants.
An important part of the process involves a case review – examining contracts, invoices, WhatsApp messages, and other documentation. 'It's all document-based so you really need a good water tight written agreement in place,' said Peter Lazarus, managing director of Elite Legal. 'But it's not impossible to open a case if you only have communication to prove the terms — whatsapp and emails.' Yes Whatsapp messages can be used in court. 'So always be very careful how and what you say. The golden rule is — would you be embarrassed if the message was read in court?' added Lazarus.
Next comes a legal notice – sending a demand letter asking for payment within a set deadline (usually seven days). Then negotiation – attempting a settlement before filing. As a last resort, a court filing – if the debt remains unpaid, then file a case in the civil court (or labour court if it's salary-related). Court proceedings will then follow – attending hearings, submitting evidence, responding to defenses. Finally, the enforcement – if a judgment is issued in your favour, filing for execution (freezing accounts, travel bans, etc.).
Employment
Employment disputes make up a significant share of legal cases in the UAE, typically involving unpaid salaries, end-of-service benefits, or other contractual entitlements owed to employees. 'I target speaking to bosses of the debtor companies as they are the decision makers and people in authority to get the debt cleared,' said Lazarus. How and when does he get involved? 'As soon as the client gets the 'false promises' to pay, this is a red flag that delay after delay is an issue waiting to happen. The older the debt the less chance of recovery. I use the court as a last resort and try to settle the cases amicably with face-to-face meetings, that way it remains professional and a solution can be found,' he added.
Costs
Legal fees in the UAE can vary significantly depending on the complexity of the case. In most situations, law firms will agree on fixed fees to be paid in advance of starting work. Some law firms may offer reduced fixed fees combined with a success fee, which is only payable if the case is successful and the client recovers the debt.
Musaab Ali Alnaqbi Advocates and Legal Consultants gave a helpful breakdown. Legal fees: Dh5,000–15,000 for simple cases. Court fees: usually six per cent of the claim amount, capped at Dh40,000 in most emirates. Translation costs: Dh500–2,000+ depending on documents. Power of Attorney notarisation: around Dh250–500.
'In total, for a simple claim of under Dh100,000, be prepared to spend Dh8,000–20,000 in total legal and court costs, though some lawyers offer flat fees or installment plans,' said Khaleel.
Ahmed Tony, a partner at Matouk Bassiony law firm, explained that the UAE operates a dual court system comprising onshore and offshore court systems, each with distinct legal frameworks and procedures. The offshore courts provide for a common law jurisdiction (similar to English courts) and are independent from the local court system. This includes the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market Dhabi (ADGM). Onshore courts, on the other hand, follow UAE federal and emirate-specific laws. Real-time updates on case status, hearing dates, and court decisions are provided through the court portals and mobile apps (like the Dubai Courts Smart App), making the process more user-friendly and predictable.
'Before starting court proceedings, it is important to keep in mind your ultimate desired outcome and whether going through with the case is worth it. For example, sometimes winning a case may not be in the business's best interest if it leads to reputational damage, waste of resources or cutting business ties with the other party,' Tony said.