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Entrepreneurship is a complicated business. Every day it is about seeing and seizing opportunities, communicating, making agreements, taking risks and so on. A mistake is quickly made and a misunderstanding or miscommunication can happen to the best of us. Often such a thing is quickly resolved or talked out, but sometimes a conflict arises.

When the interests are big, solving such a conflict is not always easy. It is then important that you are timely and well informed about your legal position and your legal possibilities. After all, being right is not always the same as being put in the right. As an entrepreneur, it is essential for you to be able to determine your strategy in a well-informed way and to decide how to proceed with the conflict. Can this still be resolved in mutual consultation or must it be submitted to the court?

If the latter is chosen, it is of great importance that your story is brought to the court as well and convincingly as possible. You and your lawyer are a team with a common goal: convincing the judge and achieving a good result.

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Bouwe Bos

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A right to compensation after termination of cohabitation without a contract or marriage?

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The Supreme Court issued an interesting judgment on the question whether a partner is entitled to compensation from the ex-partner after ending cohabitation without a contract (also referred to as: informal cohabitation).

Right to compensation of ex-partner in case of termination of cohabitation without contract or marriage?

The case is clear. A man and a woman lived together without a marriage, registered partnership or cohabitation contract. They have a child together. The partners lived in a house owned by the husband. The (mother of the) woman took care of an expensive renovation (€ 74,000) of the man’s house. The man was financially unable to take care of the renovation himself. The partners did not agree on the costs of the renovation. Subsequently, the relationship was broken off. The question is whether the woman has a right to compensation towards the man concerning the costs she paid for the renovation.

Judgment of the Court of Justice on the right to compensation of ex-partner

The Court rejected the woman’s claim because they saw no legal basis for the claim. There is no contractual basis, because there is no cohabitation contract or agreement on the costs of the renovation. Article 1:87 of the Dutch Civil Code, which deals with compensation rights between spouses and registered partners, does not apply either, because there is no marriage or registered partnership. Nor can there be a corresponding application of the article. Furthermore, the Court of Appeal notes that on the basis of what has been stated by the woman he cannot establish that there is a claim on the basis of unjust enrichment.

Judgment of the Supreme Court on the right to compensation and the role of reasonableness and fairness in informal cohabitation

The Supreme Court upholds the judgment of the Court of Appeal. In order to accept unjustified enrichment, it is necessary to establish that if the woman had not borne those costs, the man would have made those costs himself or would have been obliged to make them. Since the man did not have financial means to incur the costs, there is no reason to believe that he would have incurred them. Therefore, the mere fact that the woman incurred costs does not automatically lead to the conclusion that the man saved himself the costs.

However, according to the Supreme Court, the above does not alter the fact that there is a legal relationship between informal cohabitants that is partly governed by reasonableness and fairness. It continues:

“Even if, with regard to certain expenses, a right to compensation from one cohabitant to another cannot be assumed on the basis of an agreement concluded between the parties or on the basis of the other legal figures regulated in Book 6 of the Dutch Civil Code, such a right to compensation may, in connection with the special circumstances of the case, arise from the requirements of reasonableness and fairness referred to in Article 6:2 paragraph 1 of the Dutch Civil Code”.

The Supreme Court considered that it would then have been up to the woman to establish the special facts and circumstances which, according to standards of reasonableness and fairness, imply that she has a right to compensation towards the man. The woman catches the bone after all:

“The documents of the proceedings allow no other conclusion than that the woman has not stated any special facts and circumstances which, assuming that the man was financially incapable of paying the costs of the renovation himself and that the renovation has not enriched her, may nevertheless mean that she has a right to compensation towards the man resulting from the demands of reasonableness and fairness”.

In this specific case, therefore, no compensation is granted in the event of termination of cohabitation without a contract.

No agreement, but a legal relationship between informal cohabitants

The Supreme Court’s interpretation of the legal relationship between cohabitants is interesting. Apparently, the Supreme Court does not assume that cohabitation creates an agreement, but it does create a legal relationship that is governed in part by reasonableness and fairness.

Do you have any questions about your rights when ending informal cohabitation? Please contact Peter de Graaf or Hans Rijntjes.

Hans Rijntjes

+31 (0)10 209 27 55

Gentia Niesert

+31 10 209 27 77


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