Abu Dhabi: People have become embroiled in complex legal disputes because of excessive trust in used car transactions, attractive price offers and reliance on verbal agreements while ignoring official ownership transfer procedures.
Courts across the UAE have heard several cases involving one party withdrawing from an agreement, with some deals linking the value of a vehicle to the settlement of accumulated traffic fines, while others relied on post-dated cheques as undocumented guarantees.
Traffic expert Dr Jamal Al-Amiri urged buyers and sellers to avoid verbal sales, verify any restrictions on a vehicle before making payments and comply with the 14-day deadline for transferring ownership.
Legal adviser Mohammed Al-Hayis also warned consumers against being swayed by offers to purchase cars in exchange for paying outstanding fines without first verifying the restrictions on the vehicle and whether ownership can legally be transferred.
Several advertisements offer vehicles for sale in exchange for settling outstanding traffic fines ranging from Dh5,000 to Dh10,000.
Court records show multiple cases in which parties suffered financial losses after used car transactions failed to proceed through official ownership transfer procedures.
In one case, a buyer paid Dh4,200 in traffic fines on a vehicle as part of an agreement to purchase it. The seller later withdrew from the deal and refused to complete the transfer process. The buyer filed a lawsuit, and the court ordered the owner to reimburse the amount paid for the fines.
In another case, a vehicle owner verbally agreed to sell his car on the condition that the buyer settled outstanding fines. Relying on their personal relationship, he handed over the vehicle, which the buyer used without completing the payment or ownership transfer. During this period, the buyer accumulated additional traffic fines worth Dh16,000 and was involved in accidents that affected the vehicle’s market value, prompting the owner to take legal action.
In a third case, a buyer paid Dh7,500 for a vehicle and requested an additional two days to complete the transfer process. He retained possession of the vehicle, incurred traffic violations amounting to Dh4,835 and refused to return the car or transfer ownership. The court rejected the seller’s claim to recover the fines, citing insufficient evidence that the relevant authorities had been notified to determine who committed the violations.
Dr Al-Amiri stressed the importance of completing vehicle ownership transfers through official channels to protect the rights of both parties. He noted that the executive regulations of the Federal Traffic Law set out clear and binding procedures governing ownership transfers.
Official channels
He explained that the registered owner remains legally responsible for all obligations and violations associated with a vehicle until ownership is officially transferred. As a result, verbal agreements and informal arrangements expose both parties to significant legal risks.
Dr Al-Amiri emphasised the need to formally document ownership transfers, avoid verbal agreements, verify vehicle restrictions before making payments, comply with the 14-day transfer deadline and settle fines only through official channels.
He also urged used car buyers and sellers to use approved channels when conducting transactions through social media platforms, warning that paying traffic fines on someone else’s vehicle does not give a buyer any legal ownership rights unless the transfer is formally completed.
He highlighted the importance of carrying out an immediate technical inspection at authorised centres to ensure the vehicle has not been involved in serious accidents and is free of major mechanical defects. He also advised checking digitally for restrictions or judicial seizure orders that could prevent ownership transfer.
Dr Al-Amiri recommended linking any financial settlements or payment of fines directly to the ownership transfer process at customer happiness centres or through official police smart applications to safeguard the rights of both parties.
Mohammed Al-Hayis said advertisements offering vehicles in exchange for settling fines and obligations can raise legal concerns and should be approached with caution. He explained that such arrangements do not automatically constitute fraud, provided the seller is authorised to sell the vehicle and any restrictions can legally be removed.
However, he warned that buyers often fail to distinguish between traffic fines and other restrictions, such as bank mortgages or judicial seizure orders. Paying fines alone does not remove these restrictions or guarantee that ownership can be transferred.
Liability and offences
He added that official ownership transfer procedures require the settlement of fines and the fulfilment of all conditions for releasing any mortgage or lien, alongside other licensing requirements.
Al-Hayis stressed that purchasing a vehicle does not transfer criminal liability for any previous offences, as criminal responsibility remains personal. He noted that not every unregistered sale is automatically invalid, and a distinction must be made between the contractual relationship between the parties and the official registration process.
He outlined common forms of fraud in the used car market, including forgery, impersonation of owners, the sale of rented vehicles, concealment of mortgages or serious accident histories, odometer tampering and fraudulent advertisements designed to collect deposits.
Al-Hayis noted that Article 451 of the UAE Crimes and Penalties Law provides penalties for acquiring another person’s money through deception or false representation, including cases where a vehicle is sold while burdened by restrictions that cannot legally be removed.
He also cautioned against vehicle sales based on post-dated cheques, warning that handing over a vehicle before receiving payment exposes sellers to financial risk. A returned cheque alone does not necessarily constitute fraud unless accompanied by deception and criminal intent.
He explained that the Commercial Transactions Law allows holders of returned cheques to use them as enforceable instruments for direct execution proceedings. The law also penalises bad-faith actions such as issuing a cheque in a manner that prevents payment or closing an account before the cheque is presented.
Regarding customary sales, Al-Hayis said legal ownership transfer requires an official application to the relevant licensing authorities, including the Roads and Transport Authority and traffic departments. He warned that relying solely on paper agreements leaves legal responsibilities attached to the registered owner.
He advised buyers to verify the seller’s identity, match the chassis number, inspect the vehicle thoroughly and check officially for restrictions, mortgages and liens. He also recommended coordinating payment with the completion of registration and avoiding reliance on transfer receipts or post-dated cheques. Receiving cash or clearing a certified cheque through a bank before signing a waiver remains the safest option.
Al-Hayis further recommended documenting all agreed financial payments, including conditions for refunds if ownership transfer cannot be completed. He urged buyers to coordinate payments with the removal of restrictions and the completion of registration to avoid paying a seller’s liabilities only to discover the vehicle cannot be registered in their name.
He concluded that the safety of a used car purchase should not be judged by an attractive price or advertisement, but by the validity of the documentation, the credibility of the seller, the ability to remove restrictions, the successful transfer of ownership and the protection of both parties’ rights.
In cases of suspected fraud, he advised buyers to retain advertisements, correspondence, documents and proof of payment and submit them promptly to the relevant authorities.
Al-Hayis urged consumers not to rely on offers that involve settling fines or obligations as the sole basis for purchasing a vehicle. Instead, they should first verify the nature of all restrictions and ensure that ownership can be legally transferred.