Yes, state-granted residential land may be seized and sold at public auction if the plot remains vacant, undeveloped, and has not been used by the debtor as an actual residence. This was established by the Abu Dhabi Court of Cassation (Commercial Division) in its judgment of 20 April 2026 in Commercial Appeal No. 324 of 2026, where the Court held that protection from enforcement depends on actual occupancy, not on the land's classification or designation. This ruling is a significant reference for banks, financial institutions, creditors, and legal practitioners working in judgment enforcement and debt recovery in the United Arab Emirates.

The UAE enforcement system is built on the principle of the general guarantee, meaning that all of a debtor's assets are available to satisfy creditors unless expressly exempted by law. Article 242 of the Civil Procedures Law, issued by Federal Decree-Law No. 42 of 2022, lists assets that may not be seized, including the dwelling actually occupied by the debtor and the dependants the debtor is legally obligated to support.

The question arises when the property is state-granted land designated for residential use but remains an undeveloped vacant plot: does it enjoy the same protection as an occupied home? This is what the Abu Dhabi Court of Cassation answered in the ruling under review.

The dispute arose from Execution Proceedings No. 3741 of 2019, initiated by a bank as a mortgagee of a plot of land under a mortgage registered on 19 February 2015. The bank requested the execution judge to attach the land and put it up for public auction to recover its debt.

The execution judge rejected the request on 14 February 2026, reasoning that the property was a government grant that could not be sold. The bank appealed, but the Court of Appeal upheld the rejection on 11 March 2026. The case was then brought before the Abu Dhabi Court of Cassation — Commercial Division.

The dispute centred on two legislative provisions relied upon by the lower courts to deny the creditor's request:

First: Article 242 of the Civil Procedures Law, which exempts from seizure the dwelling actually occupied by the debtor and the debtor's legal dependants.

Second: Resolution No. 25 of 2018, which prohibits the disposal of state-granted residential properties allocated to UAE nationals.

The courts of first instance and appeal applied both provisions broadly, concluding that the land — being a grant designated for residential use — was protected from enforcement. The Court of Cassation disagreed and overturned both rulings.

The distinction drawn by the Court of Cassation between compulsory judicial sales and voluntary disposals is among the most significant aspects of this ruling:

The Abu Dhabi Court of Cassation overturned the lower courts' rulings and ordered the continuation of the public auction proceedings for the disputed land. The respondent was ordered to pay the costs of both the cassation appeal and the earlier appeal.

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