The Developer Offered Cash Instead of Fixing the Snags: How to Decide
A two bedroom apartment in JVC. The snag report had gone in, the developer had gone quiet for a fortnight, and then customer care replied with a short email offering a lump sum in lieu of rectification, with an acknowledgement attached to sign and return. This is one of the calls we get most often at Prime Inspections.
The owner forwarded it to us with one line.
“Is this good or bad?”
Neither, as it turned out. It depends on three things, and the size of the number is not one of them.
We have no stake in which way this goes. We do not carry out repairs, and we are not paid differently depending on whether you take the money or the works. What we can do is price the actual scope, which is the one thing an owner cannot do alone, and which is exactly what the offer was made without.
Can a Dubai developer pay you instead of fixing the snags?
Yes. Cash in lieu of rectification is a normal commercial settlement and it is lawful when both sides agree.
It is only sensible when two conditions hold. The amount must cover the full repair scope, meaning labour, materials, supervision and consequential damage risk, not just the visible work. And the wording must settle the named items only, not everything arising from the property.
Never accept cash for structural or waterproofing defects. That rule has no useful exceptions.
Why developers make the offer
It is worth understanding the logic, because assuming bad faith leads owners to make worse decisions than the ones they are trying to avoid.
The contractor has demobilised. Once the site team has stood down, bringing trades back for one apartment is disproportionately expensive.
The rectification queue is long. On a tower handing over hundreds of units, works are scheduled in batches, and a single unit’s list may sit for weeks.
Cost certainty. A settlement is a known number. A rectification programme is an open ended obligation with a risk of return visits.
Working in an occupied unit is expensive. Once furniture and residents are in, protection, access windows and making good all add cost.
Closing the file. A settled item is a closed item on their system.
None of that makes the offer a trick. It also does not make it well priced, because the same pressures that motivate the offer are the ones that produce a number generated from a quick internal estimate rather than a scope.
How to price the offer properly
Four components plus a contingency. Most offers we are asked to review cover one and a half of them.
Labour
Contractor day rates in Dubai vary widely by trade, by whether the job is a small callout or part of a larger package, and by the community and access arrangements.
Do not take a number from an article, including this one. Obtain two or three written quotations for the actual scope, from contractors who have seen the report. That is your labour figure.
Materials
The trap here is matching, not quantity.
Tile from the original batch may no longer be available, and a close match in one bathroom can mean retiling a whole floor for the finish to read correctly. Paint batches drift, so a patch repair often means the full wall or the full room. Ironmongery and sanitaryware specifications get discontinued between construction and handover.
Price the material for the finish you will actually accept, not the material area of the defect.
Supervision
This is the component almost every offer omits, and it is the one you inherit the moment you accept.
By taking cash you become the client. That means:
- Coordinating trades and sequencing the work
- Arranging access, and obtaining developer or Owners Association approvals to bring a third party contractor in, which many Dubai communities require
- Snagging the new work, because your contractor’s work needs checking too
- Making good adjacent finishes disturbed during the repair
- Your own time, which has a value even if you never invoice it
Consequential damage risk
Ask the question the offer does not: what happens if this repair fails?
While the developer holds the obligation, a failed repair is theirs to redo. After a settlement, a failed repair is yours, along with whatever secondary damage it causes. If a wet area repair leaks into the unit below, similar to what we cover in damp appearing on a ceiling, you are the party that other owner and their insurer come to.
That risk transfer has a price, and it should be priced into what you accept.
Contingency
Add for scope discovered on opening up. In wet areas that is not a possibility, it is the norm. You will not know the full extent of a waterproofing failure until the tiles come off.
The four line comparison
| Line | What goes in it |
|---|---|
| Offer | The developer’s figure, as stated |
| Priced scope | Labour plus materials plus supervision plus contingency, from written quotations |
| Gap | The difference between the two |
| Residual risk retained | What you carry if the repair fails, stated in words |
We reviewed an offer that covered materials and a day rate and nothing else. Nothing for supervision, nothing for snagging the new work, nothing for making good the adjacent finishes that would be disturbed.
An offer priced from a material list is almost always short.
Not sure what the repair actually costs? View our free sample report and see how we scope and score defects.
What accepting the cash actually discharges
This is where the real risk sits, and it has nothing to do with the amount.
The contractual Defects Liability Period
Your DLP is contractual, set by your SPA, commonly twelve months from handover. It is not statutory, so read your own clause.
A settlement can discharge the developer’s obligation for the items settled. Depending on the wording, it can discharge considerably more than that.
What “full and final settlement” means
There is a large distance between two sentences that look similar.
Settling listed items: the developer is released from the obligation to rectify snag items 14, 27 and 31. Everything else continues.
Full and final settlement of all claims arising from the property: the developer is released from everything, including defects nobody has found yet.
Owners sign the second thinking they signed the first. That is the single most common way value is lost in these settlements, and it costs nothing to correct at the drafting stage.
What cannot be waived
Decennial liability is the exception, and it is worth knowing precisely.
Article 821 of Federal Decree-Law No. 25 of 2025, previously Article 880 of Federal Law No. 5 of 1985, imposes ten year strict liability on the contractor and the supervising engineer for total or partial collapse and for defects threatening the structural stability and safety of the building. Federal Decree-Law No. 25 of 2025 repealed the 1985 law and came into force on 1 June 2026.
Article 823, previously Article 882, voids any clause that excludes or limits that liability. Article 824, previously Article 883, requires a claim within three years of collapse or discovery.
So no settlement removes decennial liability, whatever the letter says.
That is genuine protection, and it is also narrower than owners hope. Decennial covers structural stability and safety. It does not cover a leaking bathroom, a poorly finished wall or an underperforming AC. And a broadly worded settlement can still badly weaken your contractual and evidential position on everything that is not structural.
MEP and installation warranties
The MEP warranty, commonly twelve months, is contractual practice rather than law.
Check separately what a settlement does to manufacturer warranties on equipment. Some are voided when a third party contractor works on the installation, and that consequence usually appears nowhere in the settlement discussion.
When accepting cash is the right call
Sometimes it clearly is, and any article that will not say so is selling you something.
Cash tends to be the better outcome when:
- The list is cosmetic and finishing only, with the cosmetic conclusion actually tested rather than assumed
- The scope is contained and well understood, with no concealed elements
- You are renovating anyway, so the works are happening regardless
- You want control over finish quality rather than accepting the developer’s contractor
- The rectification queue is slow and time has real value to you
- You are selling or leasing and need certainty on a date
That last one is worth expanding. A landlord with a tenant ready deadline, a signed offer and Ejari timing to hit may find that six weeks of waiting costs more than the gap in the offer. Speed is worth money, and it is legitimate to price it.
We saw a finishing only list on a Bluewaters Island apartment where the owner was already planning a renovation. The settlement funded an upgrade on work he was commissioning anyway. That was a good outcome for him.
Cash works best when the defect is cosmetic, contained, and inside a scope you were going to run yourself.
When to refuse outright
Some categories are not negotiable, whatever the number.
Structural defects. Anything affecting stability or safety.
Waterproofing and water ingress. Any of it, anywhere, the category our Water Leakage Inspection service exists to test for before any settlement figure is agreed.
Fire and life safety items. Detection, compartmentation, escape routes, fire rated elements.
Electrical safety. Exposed conductors, earthing, RCD protection.
Facade and external envelope. Access alone makes owner managed repair impractical, and the same logic applies to private pool structures, which we assess separately under our Pool Inspection service.
Common property defects. These fall to the Owners Association or Management Company under Law No. 6 of 2019, so the developer settling them with you individually may not resolve anything.
Three reasons run through all of them.
Latency. These defects reveal themselves slowly. The offer is made when the evidence is thinnest.
Hidden scope. You cannot price what you cannot see, and these are exactly the categories where the visible defect is a fraction of the work.
Proof burden. A settled defect that reappears becomes yours to prove, and proving that a recurrence relates to the original construction defect rather than to your contractor’s repair is very difficult after money has changed hands.
We looked at a villa wet area on Jumeirah Bay Island where the visible evidence was a modest stain at the base of a wall. The real scope was tiles up, screed out, membrane reinstated, everything relaid, plus making good the ceiling below. The offer had been sized against the stain.
With water, the visible defect is a fraction of the scope.
Before you reply to the developer, speak to our engineer and get the scope priced independently.
The wording to insist on
The following is general information, not legal advice. Settlement wording has consequences that depend on your specific contract, so take your own legal advice before signing anything.
Points to raise with your lawyer:
- An itemised schedule. The exact snag reference numbers being settled, listed. Not “the defects raised” or “the snag list”.
- Express preservation of the DLP for everything else. A sentence confirming that the Defects Liability Period continues in full for all items not listed in the schedule.
- Express acknowledgement on statutory liability. Confirming that nothing in the document affects statutory decennial liability. It cannot be waived anyway, but having it stated removes the argument.
- No general release of all claims. Push back on any language releasing the developer from all claims arising from the property, whether known or unknown.
- Payment terms and a date. When, how, and what happens if payment is late.
- VAT treatment stated on the face of the document. So there is no dispute afterwards about whether the figure was inclusive.
We reviewed a case where the settlement covered a named list of items with the defects period expressly preserved for everything else. Two months later an unrelated item was raised and rectified normally, because the earlier settlement had been drafted to reach only what it was meant to reach.
Partial and itemised beats full and final.
VAT and the money itself
Whether a settlement payment is compensation falling outside the scope of VAT, or consideration for a supply, depends on how the payment is characterised. That distinction can materially change what you actually receive.
We are engineers, not tax advisers, as our About Us page makes clear, and we will not give you a definitive treatment here because the answer depends on the specific arrangement. Take professional tax advice and confirm current Federal Tax Authority guidance before you agree a figure.
The practical point is simply this: agree the VAT position in writing before you accept, not after the payment arrives.
If you refuse and the developer goes quiet
If the developer stalls rather than engaging, see our guide on what to do when a developer ignores your snag list. Otherwise the escalation route is the same as for any other unresolved snag.
- Written dated notice. To the developer or main contractor, citing the SPA defect clause and the DLP, restating the outstanding items with evidence.
- Customer care, then head of customer experience. In writing, one thread, referencing dates.
- RERA and the Dubai Land Department. Via the Dubai REST app or the Dubai Land Department website violations route. The fee is commonly cited at AED 1,000 per complaint, with an initial response in about five working days and admission roughly seven to fifteen days once documents are complete. The decision target is around 60 days. RERA sits within the DLD. Verify current figures and treat timings as targets.
- Dubai Courts. Claims above AED 100,000 generally need a report from a DLD registered property consultant, commonly around AED 5,000 to AED 15,000. Dubai Courts filing fees are percentage based with a cap commonly cited near AED 40,000.
Two corrections. The Rental Disputes Centre handles landlord and tenant disputes only and does not hear buyer versus developer defect claims. Dubai Municipality is the right authority for building code and structural safety concerns. The DLD call centre is 800 4488.
What an independent inspection changes
It converts a lump sum into a comparison.
Right now you have a number and no scope. A severity scored report with photographic evidence and a developer ready rectification checklist gives you a defensible scope, which is what a contractor needs to quote against and what turns “is this good or bad” into arithmetic.
Inspection ranges by unit type, as market ranges only, request a quote:
| Property | Market range |
|---|---|
| Studio or 1 bedroom | AED 800 to AED 1,200 |
| 2 bedroom | AED 1,200 to AED 1,800 |
| 3 bedroom | AED 1,800 to AED 2,500 |
| Townhouse | AED 2,500 to AED 3,500 |
| Villa | AED 3,500 to AED 6,000 and above |
The same scope-pricing approach applies whether you are at a new handover or verifying a resale purchase through our Resale Property Inspection service.
If you take the cash and run the works yourself, a Contractor Work Inspection at completion verifies what you paid for, which matters more when there is no developer left to hold responsible.
Frequently asked questions
Can a developer pay me instead of fixing snags in Dubai? Yes, cash in lieu of rectification is a normal commercial settlement and lawful where both sides agree. Whether you should accept depends on whether the amount covers the full repair scope and whether the wording settles only the named items rather than all claims.
Does accepting cash cancel the Defects Liability Period? It can, depending entirely on the wording. A settlement limited to listed snag items discharges only those. A full and final settlement of all claims arising from the property can discharge far more, including defects not yet discovered. Insist on an itemised schedule.
What does full and final settlement mean? It means the developer is released from further claims within the scope described. If that scope is a named list of items, the release is narrow. If it covers all claims arising from the property, it is very wide, including things nobody has found yet.
Should I accept money for a waterproofing defect? No. Waterproofing failures are latent and the visible damage is usually a small fraction of the real scope, which typically involves tiles, screed, membrane and often the ceiling below. If a settled waterproofing defect reappears, proving its origin becomes your burden.
Can a developer avoid the 10 year structural liability? No. Article 823 of Federal Decree-Law No. 25 of 2025, previously Article 882 of Federal Law No. 5 of 1985, voids any clause excluding or limiting decennial liability. Article 821 imposes it for ten years, and Article 824 requires a claim within three years of discovery.
How do I get an independent repair cost estimate in Dubai? Obtain two or three written quotations from contractors working to a defined scope, which means a severity scored inspection report with photographs rather than a verbal description. Without a documented scope, quotations are not comparable to each other or to the offer.
Is VAT charged on a settlement payment? It depends on how the payment is characterised, and that distinction changes your net amount. Take professional tax advice and confirm current Federal Tax Authority guidance. Whatever the answer, agree the VAT position in writing before accepting rather than after payment.
What if the repair costs more than the cash offered? Once you have accepted a settlement for those items, the shortfall is generally yours. That is precisely why pricing the scope before replying matters more than negotiating the number, and why supervision and contingency belong in the calculation from the start.
What if the defect comes back after I accepted cash? For settled items, recurrence is usually your problem, and you would need to establish that it stems from the original construction defect rather than the repair you commissioned. Structural stability and safety defects remain covered under decennial liability regardless.
What should the settlement letter say? An itemised schedule of the snag reference numbers being settled, express preservation of the defects period for everything else, acknowledgement that statutory decennial liability is unaffected, no general release of all claims, payment terms with a date, and the VAT position. Have a lawyer review it.
Where we carry out these inspections
We price and scope settlement offers across Dubai’s apartment towers and villa communities, including Dubai Hills Estate, Emirates Hills, District One, Palm Jumeirah and Tilal Al Ghaf, alongside Dubai Creek Harbour, Bluewaters Island and Jumeirah Bay Island covered above. Read more in our Home Inspection and Snagging blog categories.
The engineer’s judgement
An offer like this is usually neither a trap nor a gift. It is a number produced without a scope, by someone under pressure to close a file.
Produce the scope first, and the decision tends to make itself. Sometimes the priced scope comes in below the offer and you take the money with confidence. Sometimes the gap is wide enough that you reply asking for the works. Either way you are answering with arithmetic instead of instinct, which is the whole point.
And whatever you decide on the number, get the wording right. The amount is a one time question. The wording is what determines what you still hold twelve months from now.
Our inspections cover 250 plus points with thermal imaging, moisture metering and full MEP testing as part of our Complete Building Inspection approach, delivered as a photo based digital report within 24 hours with severity scoring and a developer ready rectification checklist. Clients rate us 4.9 out of 5 across 108 Google reviews, and the feedback that fits this page is: “The report was well structured and accepted by the developer without arguments.”
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Book an inspection now on +971 50 602 1830, WhatsApp for an instant quote, or email connect@primeinspections.ae. Office 1914-203, The Binary by Omniyat, Business Bay, Dubai.
