Living together in the Netherlands: Property and legal aspects

This is the second blog in our series Living together in the Netherlands, in which we discuss property relations. In addition to financial obligations and alimony, property is an important aspect for cohabitants. What happens to jointly purchased goods or a shared home when the relationship ends? This blog discusses the legal aspects of property relationships for cohabitants and how they can protect themselves legally.

Property relationships: What does the law say?

Married couples and registered partners are automatically covered by family law. They are married or registered partners, which means they are protected by the community of property or by a marriage contract, if they have one. The situation is different for cohabitants. They have no automatic right to property that their partner has acquired during the relationship. Legally, the property remains with the person who acquired it, unless otherwise agreed.

This means that if a house is registered in the name of only one partner, the other partner has no legal claim to it, even if he or she contributed financially. This can lead to significant complications in the event of a relationship breakdown or death.

Joint ownership: How can this be arranged?

To avoid confusion and disputes, cohabitants can make legal agreements about their property. This can be done in a number of ways, including;

• Drawing up a cohabitation agreement that specifies what property was contributed by whom and how it will be divided in the event of separation.
• Entering into a cohabitation contract that is notarized and explicitly regulates property rights and financial contributions.
• Register a home jointly in the deed so that both partners are legal owners.
• Make agreements about joint investments so that it is clear who is entitled to what share of jointly purchased goods.

What happens when the relationship ends?

Without clear agreements, cohabitants can find themselves in a state of legal uncertainty when the relationship ends. Without written agreements, the law applies strictly:

• The person who is the legal owner of an asset retains ownership after divorce.
• If a home was purchased jointly, but one of the partners contributed more, a dispute may arise over the division of the added value.
• In the case of unjust enrichment, the non-owner may still be able to claim financial compensation under certain conditions.

However, claiming unjust enrichment is a legally complex procedure and requires thorough legal assistance.

Property rights and compensation

Married couples and registered partners are subject to special legal rules regarding property relations and compensation rights.

• In the case of joint property, everything acquired during the marriage is in principle joint property.
• In the case of a prenuptial or partnership agreement, specific arrangements can be made regarding private assets and any reimbursement rights in the event of an investment in the joint property.
• If private assets are used for a joint purchase, a right to reimbursement may arise, depending on the agreements made and the legislation (Article 1:87 Civil Code).

Cohabitants do not automatically have such rights. A cohabitation agreement may contain provisions on the division of property and investments, but without explicit agreements there is no legally enforceable arrangement.

Case Law on Property Relationships between Cohabitants

Recent case law shows that in many cases, cohabitants cannot claim property or compensation in the absence of an agreement:

• HR 10 May 2019, ECLI:NL:HR:2019:707 - The Supreme Court ruled that family law cannot be applied by analogy to cohabitants. A right to compensation can only be claimed on the basis of general contract law.
• Supreme Court 17 November 2023, ECLI:NL:HR:2023:1571 - The Supreme Court ruled that a cohabitant is not automatically entitled to compensation for investments in a shared home, unless there is an explicit agreement to that effect.
• Supreme Court 8 November 2024, ECLI:NL:HR:2024:1598 - The Supreme Court overturned a decision in which a cohabitant had offered evidence of an implied right to a share in his ex-partner's home, which had been rejected by the Court of Appeal. The case has been referred to another appellate court for further consideration. A final decision has not yet been issued.

Statute of limitations for cohabitants

Another important issue is the statute of limitations. Cohabitants are subject to the general statute of limitations of the Civil Code:

• A claim based on a contract expires five years after the due date on which the claim becomes payable (Article 3:307 Civil Code).
• A claim based on undue payment expires after five years, but no later than 20 years after the claim arises (Section 3:309 of the Civil Code).
• A claim based on unjust enrichment expires after five years, but no later than 20 years after the claim arose (Section 3:310 of the Civil Code).

For married persons and registered partners, the limitation period is extended by six months after the end of the marriage or registered partnership. In some cases, judges also apply this extension to cohabitants, but there is no clear case law on this.

Conclusion

Property relations are a crucial part of cohabitation and can lead to legal and financial complications when a relationship ends. To avoid legal uncertainty, it is advisable to put agreements in writing. This can be done through a cohabitation agreement, a notarized document that contains clear agreements about shared property and investments.

Recommended steps for cohabitants:

• Draw up a (notarized) cohabitation agreement with agreements on ownership, how to deal with investments in each other's assets, mutual contributions to the costs of (joint) assets, and division in case of separation.
• Put real estate in the names of both partners so that it is jointly owned.
• Consult a legal professional to properly map out property rights and potential risks.

In our blog series Living together in the Netherlands, we discuss other legal points of interest. Read our first blog about the general rights and obligations of cohabitants. In future blogs, we will look at other important topics, such as pension rights and inheritance law.

Do you have questions about your property rights when living with a partner?

If you have any questions or would like more information on this topic, please contact family law attorney Sandra Verburgt.