In the UAE, a debt is directly executable before the UAE Courts where it has been notarized and stamped with a stamp of execution by a notary public. This may be an attractive route for settling debts, for debtors and creditors alike, due to the time and cost-efficient nature of the process. In particular, it offers a mechanism by which debt(s) can be settled without the need for further Court proceedings and avoids the costs usually associated with Payment Order applications in the UAE Courts.
Federal Law No. 4/2013 On the Organization of the Notary Profession, under article 12 on ‘Placing the Writ of Execution’ provides that, a notary may seal a written declaration of debt, which has been written or authenticated by him, with a ‘writ of execution’ at the request of a concerned party (usually a creditor). By stamping the declaration of debt with the ‘writ of execution’, the document is given executory force. This means that a creditor can have that debt directly executed before the UAE Courts without the need for any further Court applications or proceedings. Analogous provisions can be found in Dubai Law No. 4/2013 On Notaries Public in the Emirate of Dubai, under article 24 governing ‘The Executory Force’.
This procedure requires the debtor’s consent as they will be required to attend the offices of the notary public. Therefore, this procedure is usually used where a debtor is willing to settle their debt(s) amicably but wishes to enter into some form of deferred payment plan with its creditor(s).
In such circumstances, the parties can sign a declaration of debt. This is a document which sets out, amongst other things, the terms for re-payment and the date(s) by which payment(s) should be made. Where the debtor defaults on the terms of the declaration, the creditor can immediately execute the same in the UAE Courts, if it has been sealed by the notary public. This route generally affords payment flexibility to a debtor whilst providing security to a creditor.
The procedure for executing debts that have been duly notarized is as broadly as follows:
- The declaration of debt must be drawn up, this can usually be done by a legal consultant.
- The debtor and creditor will then be required to attend the offices of the notary to sign the declaration in front of the notary and have it notarized.
- Upon default of the debtor, the creditor can request the notary to stamp the declaration with the stamp of execution.
- The duly stamped declaration of indebtedness can then be presented to the UAE Court for execution.