Student nuisance: Municipality has to withdraw permission for a roof terrace

Recently we discussed another case in which the owner of a roof terrace successfully appealed against a decision of the municipality to remove the roof terrace. In this blog, however, we discuss a case in which someone successfully appealed against a permit granted by the municipality for a rooftop terrace by the neighbours.

Case

The owner of a property rents his building to students. For some time the students have been using the roof of the building as a roof terrace. However, according to the municipality’s zoning plan, the use of the roof as a terrace is not permitted. Following complaints from local residents, the municipality has informed the owner of the property that enforcement actions will be taken if the use of the roof as a terrace is continued.

The owner of the property then applied for an environmental permit in order to legalise its use. The application includes the construction of a fence on the roof of 185cm in height. The municipality decided to grant the environmental permit despite the fact that a roof terrace is not permitted according to the zoning plan. The planned fencing is also higher than permitted. A neighbour who overlooks the roof terrace from the back of his house, and who claims to experience serious noise nuisance from the students, appeals to the court after the municipality has previously declared his objections unfounded.

Conflict with zoning plan

Many people assume that if a permit has been granted in violation of the zoning plan, the permit was wrongly granted in that case. This assumption is often incorrect. After all, the municipality has the right to deviate from the zoning plan, but must take into account good spatial planning. In short, this means that the competent authority must ensure the maintenance of an acceptable living and residential climate.

In this case, the municipality stated that because it concerns an urban environment, local residents must tolerate some noise nuisance from each other. According to the municipality, the fact that the roof terrace has been reduced in size due to the placement of the fencing also contributes to the reduction of possible nuisance. The municipality also stated that, when granting a permit for a roof terrace, it does not want to make a distinction between use by a family or by students, since that there are also very quiet students.

Ruling

The court states that the municipality should take all the interests involved into account. The degree of noise nuisance is important in this respect. As the municipality indicates, it is plausible that the noise nuisance has decreased due to the placement of the fencing. As a result, fewer people can enter the roof terrace at the same time. However, this has not established that the remaining degree of noise nuisance should be considered acceptable. The court takes into account that the municipality did not take into account the fact that the nuisance providers in question are students with a higher chance of a deviating rhythm of life (night hours), and therefore nuisance.[1] According to the court, the municipality should have taken this into account in its decision. The court annulled the municipality’s decision.

Conclusion

Despite the court’s judgment, the environmental permit for the roof terrace has not yet been definitively dismissed. The municipality will have to take a new decision taking into account that the roof terrace will (mainly) be used by students. The municipality could also attach conditions to the use of the roof terrace by, for example, prohibiting the use of the terrace after a certain time. For local residents, the lack of conditions could therefore also be a means of challenging the municipality’s decision. In any case, it seems that municipalities will have to take more account of the presence of students in maintaining an acceptable residential and living climate in their policy.

Do you also suffer from noise nuisance from neighbours, for example, or do you disagree with an environmental permit granted to your neighbours? In that case you can contact M2 Advocaten without engagement.

Lawyer Ginio Beij (beij@m2advocaten.nl)

[1] Also see ECLI:RVS:2018:2276 en ECLI:NL:RVS:2012:BV3229

Roof terrace may remain despite lack of permit

An owner of a roof terrace had to remove her roof terrace from the municipality under penalty of a fine. She claimed, however, that certain commitments had been given to her so that she could now be confident that the roof terrace could remain in place. The judge agreed with her and so the principle of trust was successfully invoked. In this blog we will discuss this case and explicitly the principle of trust that seems to have been given a new interpretation with this judgment. 

Case study

An owner of a roof terrace is told by the municipality that she must remove her roof terrace soon. The municipality argues that a permit for the roof terrace has never been granted. The owner who bought the house with a roof terrace from the previous owner a few years earlier claims that the roof terrace has been there for 25 years without any problems. She claimed that during those 25 years there had been contact with municipal officials multiple times from which the (previous) owner could understand that no enforcement action would be taken due to the lack of the (environmental) permit. The owner says that she could now trust that this would not happen again. The municipality does not agree with this and maintains its position.

Ultimately, the case[1] ended up before the Council of State. In the end the Council of State ruled that although there was no reason for the owner to assume that no permit would be required or that she would receive a permit, she could assume, based on the contact moments of the former owners with the civil servants, that this would not be enforced. The Council of State also considers it important that the situation has lasted for 25 years and that it has not been maintained during that period. According to the Council of State, the interests of the municipality in enforcement subsequently do not outweigh the interests of the owner. The roof terrace may therefore remain.

Principle of trust

Many citizens believe that if something is promised to them by the government, they should be able to rely on it. This is also referred to in administrative law as the principle of trust. From that perspective, the judgment in the above case will not surprise many citizens. In practice, however, it turned out that it was far from easy for citizens to successfully invoke this principle. For example, a successful invocation of the principle of the protection of legitimate expectations previously required “that concrete and unambiguous undertakings attributable to the administrative body have been given by a competent third party, from which legal expectations can be derived”[2]. In short, this strict interpretation meant that, in practice, citizens could seldom rely successfully on the principle of the protection of legitimate expectations.

Gradually, the judiciary seems to have wanted to connect more to the citizens’ perspective.[3] In the discussed case, the Council of State sought advice from Advocate General Wattel of the State Council, whose advice was followed and thus leads to a new interpretation of the principle of the protection of legitimate expectations.  This line has also been followed in case law in other judgments.[4] This advice is a brief summary:

– More emphasis should be placed on how a statement or behaviour comes across to a well-minded citizen and less on what the administrative body meant by this;

– Less emphasis is placed on the precise division of powers. Previously, a civil servant could make certain promises, but if it turned out that he or she did not have the authority to make decisions, the citizen would have lost no matter what. This was particularly sour because it will often not be clear to most citizens who actually has decision-making authority. The citizen will have to make it plausible that he had reason to rely on this official. Bar staff responsible for providing general information will not be covered by this, but it is usually necessary to be able to rely on promises made by a construction inspector in connection with a construction project, even if this inspector does not have decision-making powers;

– If both previous steps have been successfully completed, a balancing of interests will then have to be carried out. This means that if a citizen is justified in relying on a promise from an administrative body, it will still be necessary to assess whether the interests of the citizen are in proportion to other interests, such as the public interest.

Conclusion

Citizens will be able to rely more successfully on the principle of trust in the future. The government will have to realise that commitments can more often lead to justified trust on the part of citizens. However, this does not mean that citizens will always get their way, even if they had reason to actually rely on government communications. Interests will always have to be weighed up, with other interests sometimes outweighing the interests of the citizen concerned. In that case, however, compensation may be possible. Fortunately for the owner of the roof terrace, there were no other important interests involved and the roof terrace was therefore allowed to remain.

Are you looking for legal advice in case of disputes with the government? Please feel free to contact M2 Advocaten.

Lawyer Ginio Beij (beij@m2advocaten.nl)

 

[1] ECLI:NL:RVS:2019:1694

[2] ECLI:NL:RVS:2015:1016 and ECLI:NL:RVS:2015:1871

[3] see e.g. ECLI:NL:RVS:2017:1946

[4] ECLI:NL:RVS:2019:1778 en ECLI:NL:RVS:2019:1838

Purchase of property: what if it stinks?

You finally bought your dream house, but soon the house turns out to be more of a nightmare. It turns out to stink of fish and frying smells in the new house. You want to undo the purchase as soon as possible. What does the judge think of this case?

Case

A seller puts his house for sale on Funda. The house is located above a fish shop, but the seller puts the following text in the advertisement “absolutely no trouble from the shop below”.  Smell nuisance from the underlying shop seems to be out of the question. An interested potential buyer decides to visit the house and indeed does not smell any fish smell or other unpleasant smells during the visit. Then some time later, a sales agreement is concluded between the seller and the buyer. However, when the buyer enters his new home he appears to notice a penetrating smell of fish and frying.

The buyer then asks the seller to take measures so that the buyer no longer experiences the serious odour nuisance. Initially the seller promises to cooperate, but if he fails to do so, the buyer’s patience quickly runs out. He calls in a company to look into what causes the odour nuisance. In the end, the investigation shows that the fans of the fish shop are responsible for moving the smell of fish to the buyer’s home. The buyer then decides that he wants to cancel the purchase and institutes summary proceedings (urgent procedure).

Judgement of the court

In principle, a buyer of a house can dissolve the purchase agreement if the house does not comply with the agreement.  If a house does not comply with the agreement, this is also called non-conformity. What a seller has communicated about the property should also be taken into account. In short, if the seller has made it clear at the time of the sale that the house stank, the buyer cannot later dissolve the purchase agreement on the grounds of that smell. It follows from the law (Article 7:17 of the Dutch Civil Code) that the home possesses the properties required for normal use. This concept of normal use is, for example, also included in the NVM deed of sale.

In this case, the court ruled that it was plausible that there was some stench nuisance, but also that the stench was somewhat to be expected because the house was located above a fish shop. This was despite the fact that the seller had stated in the advertisement that there would be absolutely no nuisance. According to the court, it had not been sufficiently demonstrated that the stench was actually so serious that it impeded normal use of the house. Nor was it sufficiently clear that there were no ways to eliminate the stench. In short, the judge ’s opinion was  that the stench did not justify the dissolution of the purchase agreement.

Conclusion

In itself, it is remarkable that the judge ignored the fact that the seller had advertised with “absolutely no nuisance from the shop below”. In my opinion, it can certainly be defended that the seller actually obliged himself with this statement to deliver a home without any (odor) nuisance from the fish shop underneath. This would be different if, for example, the buyer had been inconvenienced by the approach of customers. From an objective point of view, the seller does not necessarily have to experience such a nuisance and it is also up to the buyer to ascertain the situation to some extent. This case definitely shows that a judge will not allow a quick dissolution of a sales contract. As a buyer, it is always important to investigate extra carefully if the circumstances give (any) reason to do so and not to accept the seller’s words too quickly.

Have you bought a property that does not meet your expectations or are you, as a seller, dealing with a dissatisfied buyer? Please feel free to contact M2 Advocaten.

 

Lawyer Ginio Beij (beij@m2advocaten.nl)

Holiday rental (AirBnB): Judge moderates fines, minister wants to increase fines

Holiday home rentals in the Netherlands continue to be very busy, especially in Amsterdam. Last year, for example, an obligation to report was introduced and at the beginning of this year in Amsterdam the number of days which a house can be rented to tourists was reduced from 60 to 30 days per year. It is clear that politics are very much interested in reducing the holiday rentals of homes through tough measures. In this blog, however, we look at a recent ruling in which the court saw reason for moderation of the fine.  Finally, we also look at current political developments in this area.

Rules for holiday rental Amsterdam

Because Amsterdam wants to prevent the housing shortage in Amsterdam from increasing even further, it wants to ensure that homes are actually used as houses and are not used too much for holiday rentals to tourists. Vacation rentals are also referred to as house withdrawals and are in principle prohibited. In case of a violation a fine of €20.500,- can be imposed. Nevertheless, under certain conditions it is possible to (temporarily) rent out a house to tourists. These are the rules:

– The main resident must actually have their main residence in the house and be registered as such;

– The holiday rental may take place for a maximum of 60 days per year;

– Accommodation may not be granted to more than 4 persons;

– It is not a rental home of a housing corporation;

– The holiday rental must have been reported to the municipality.

Moderation penalty

In principle, if one of these conditions is not complied with, the municipality may impose a fine of €20,500. It is now the case that this fine can be mitigated under special circumstances. For example, in one case the fine was mitigated because the municipality could be held responsible (long-term construction work) for the fact that the owner in question could not rent out his house regularly. Slightly less special is the circumstance that the court found reason to split the fine in two because the property had only been let once and only limited financial benefit had been enjoyed. [1]

In a recent ruling, the court goes one step further. A landlord has rented out his house to six tourists. This means he does not meet the condition of a maximum of 4 guests. Therefore, the municipality has imposed a fine of €20,500 on him. Although the court indicates that it does not consider the high fines in general unreasonable in themselves, it determines that not meeting the requirement of a maximum of 4 tourists is not so serious that a fine of €20,500 is justified. Thus, there was no evidence of a peculiarity, but the court nevertheless ruled that this violation was less serious than, for example, in the case of violation of the maximum number of days. The court subsequently decided to set the fine at €8,000. In view of this rather remarkable judgment, it is very likely that the municipality will go for an appeal in this case.

Minister puts forward a proposal for higher fines

Also recently, Minister of Interior Affairs Ollongren’s bill to substantially increase fines for illegal holiday rentals has been adopted. According to this bill, it will be possible to impose a maximum fine of no less than €83,000 for illegal rentals. Such a fine would then have to be a “repeated violation”. The bill also contains a plan for an obligation to register. In Amsterdam there is already an obligation to report, but compliance will be simplified in the case of a national registration system.

Of course, it is not yet clear whether a bill will get through and what it will ultimately look like. Nevertheless, it is particularly interesting to see whether higher fines will also give the courts more reason to moderation in certain cases. In any case, it is striking that it appears cautiously from the jurisprudence that judges sometimes see reason to moderate fines where politicians want to punish even more severely. For the time being, it can in any case be assumed that it can be advantageous to challenge a municipal fine in court.

1] Rb. Amsterdam 7 June 2018 (not published)

Have you been fined for holiday rentals? Please feel free to contact us.

Lawyer Ginio Beij (beij@m2advocaten.nl)

 

 

Penalty clauses in housing rental contract

In 2013, a ruling of the European Court of Justice revealed that many penalty clauses in leases with private tenants are not valid because they are considered unreasonable under European law. However, the District Court of Amsterdam recently issued a nuanced judgment, ruling that if the landlord is also a private individual, there is not necessarily a disrupted balance of power, as a result of which the landlord can still claim the fine.  

ROZ model and penalty provisions

When a house is rented out, usually a written rental agreement is drawn up. Often landlords use a standard Council for Real Estate Affairs (Raad voor Onroerende zaken, abbreviated: ROZ) model drawn up by specialists. Not surprisingly, many landlords assume that they have established a solid contract with this document. The ROZ-model also includes various penalty provisions to ensure that the tenant meets his obligations. But it was precisely these penalty provisions that proved to be far from ideal.

Unfair terms directive

In 2013, the European Court of Justice issued a judgment[1] which showed that the Unfair Terms Directive applied to rental contracts for residential premises. According to the Court, the aim of the Unfair Terms Directive is to provide consumers with effective protection against abuse by a commercial party of its dominant position.

Penalty clauses such as those in the ROZ-model were often found to be unfair according to this standard. An important consequence of this was also that the penalty clause turned out to be completely invalid, which meant that moderation was no longer an option. In short, the user of the ROZ-model could suddenly no longer claim a fine, even though the tenant in question was clearly at fault.

Judgment of the District Court of Amsterdam

The Directive thus aims to protect consumers against abuse by companies that are their landlord. But what if the landlord is a private individual? Until recently, this situation was uncertain, but recently the Court of Amsterdam ruled on this matter.[2] In this particular case, the landlord had only one property available for letting and it was apparently the first time that the landlord rented out housing. The court ruled that under these circumstances the lessor was entitled to claim the fine because there was no question of a disrupted balance of power.

Although the judgment as described above can be interpreted as a relaxation with regard to penalty clauses, our opinion is that in this case there were very special circumstances. We consider the scope for a broader application to be small.  For the majority of landlords, it is therefore particularly important to ensure that the penalty clauses comply with what is considered reasonable. For example, the penalty amount should not be unreasonably high, should be capped and should preferably be agreed in the lease itself and not in the general provisions[3].

Incidentally, the Council for Real Estate Affairs has meanwhile adopted a new ROZ-model for home rentals that has been adapted with due observance of current case law. If you would like a tailor-made rental agreement and/or would like to have checked whether your penalty provisions are valid, please contact M2 Advocaten.

[1] HvJ EU 30 mei 2013, EECLI:EU:C:2013:341

[2] Rb. Amsterdam 22 januari 2020, ECLI:NL:RBAMS:2020:291

[3] Hof Den Bosch 24 september 2013, ECLI:NL:GHSHE:2013:4346

 

Neighbourhood law: legal construction of roof terrace by statute of limitations

A roof terrace. Almost everyone wants to have one, but almost everyone finds it annoying when the neighbours put one on and then have clear view. So it’s not surprising that in a densely populated country like the Netherlands there are regular proceedings about the construction of roof terraces. In this blog we look briefly at the conditions under which the construction of a roof terrace is possible or not, and we also discuss a current ruling of the Arnhem-Leeuwarden Court of Appeal on this subject.

In principle, the construction of a roof terrace is not allowed, unless…

Since introduction of the new Civil Code on 1 January 1992, it has not been permitted to have windows or other wall openings, balconies or other similar works (such as, for example, a roof terrace) within two metres of the plot boundary, unless the owner of the neighbouring plot has given permission. If such permission has not been given, the owner of the neighbouring estate shall be entitled to have this unlawful state of affairs terminated. However, if this owner has permitted or tolerated the situation for more than twenty years, that right expires and he will have to tolerate the situation from that moment on. In that case, there will be an easement of prospects.

Transitional arrangement

As far as regulations are concerned, before 1992 it was still permitted to have a lateral view of the neighbouring property, which is no longer the case now (unless the neighbours have given their permission). When the regulations were amended in 1992, there was a transitional arrangement which provided that the owner of the neighbouring estate could demand that the situation be brought into line with the new law. However, the owner of the neighbouring estate had to pay for this himself. This will undoubtedly have been a reason for many people to leave their neighbours’ balconies, for example, untouched at that time.  But if the neighbors then leave the situation untouched for twenty years, there will also be an easement of view.

Case study

  1. became the owner of a semi-detached house in April 2012 (built in 1958). Since 1964 the house has a balcony that protrudes 90cm. A. started rebuilding the house almost immediately after his purchase. He removed the old balcony and built a new extension (protruding 240 cm) with a roof terrace on top of it. The neighbors are not happy with the roof terrace and claim at court among other things that the roof terrace will be removed. The court then agrees with the position of the neighbours and orders A. to remove the entire roof terrace. After all, A. has installed a roof terrace without the consent of his neighbors, which is not allowed under the current legislation.

However, a different judgment would follow in appeal to the court of appeal. The Court of Appeal argued that although the new extension does provide a side view, which has not been allowed since 1 January 1992, it was only in mid-2012 that objections to the extension were raised, whereas before that time there was already a balcony with a side view. Since 1 January 1992, the neighbours have had the opportunity to object to this extension for 20 years, which they failed to do. That is why there is an inheritance of view. However, this servitude of (side) views does not extend beyond 90cm, the length of the old balcony. A. therefore does not have to remove the entire roof terrace, but will have to make the part of his roof terrace that extends further than 90cm inaccessible, according to the court.

The neighbors had also argued that now that A. had removed the original balcony, the easement on the view would have been completely dilapidated. However, because A. had started building a similar structure at exactly the same location almost immediately, the court ruled that this did not mean that A. had renounced his inheritance service to the view. However, this was limited to 90cm.

Conclusion

Building a balcony or roof terrace with a lateral view within two meters of the neighbors’ property boundaries can become legal if one obtains permission from the neighbors or by statute of limitations. In addition, it is also possible to build a new balcony or roof terrace if there is already an easement of view as long as it does not protrude beyond the previous balcony or roof terrace under which the easement is located.

Did your neighbors build a roof terrace without your permission or do you want to build your own roof terrace and ask yourself if this is allowed? Please feel free to contact M2 Advocaten.

Lawyer Ginio Beij (beij@m2advocaten.nl)

larger picture hotel policy

The hotel policy in the four major cities

For years cities were fighting to attract tourists, nowadays the 4 big cities in the Netherlands also seem to see a downside. By means of policy, the municipalities try to steer the growth of the hotel sector in the right direction, and in the case of Amsterdam even to slow it down. In this article we take a look at the separate urban hotel policies of the four major cities in the Netherlands: Amsterdam, Rotterdam, The Hague and Utrecht. 

Amsterdam

Between 2007 and 2016, the number of hotels in Amsterdam increased by 31%. The number of hotel guests even increased by 61% since 2005.[1] With this, Amsterdam has left cities such as Barcelona and Paris far behind in terms of growth in the number of hotel beds. But the growth also has disadvantages. Nuisance, hustle and bustle and waste mean that Amsterdam believes that the quality of life in the city has come under pressure. This has ultimately led to the announcement of a hotel stop as of 2017. In short, in principle, new hotels are no longer welcome in Amsterdam. Nevertheless, hotels will be added in Amsterdam until 2020 because requests for these were already approved before the introduction of the hotelstop. In addition, the Municipal Executive is authorised to make an exception to the policy on the grounds of very serious spatial-legal or economic grounds.[2]

Assessment framework

First of all, these hotels are only allowed in specific areas. These are mostly areas outside the ring road of Amsterdam, with the exception of Amsterdam North, where there are still plenty of possibilities.[3] But apart from the location, there must also be a unique concept that actually adds something to the already existing hotel offer in Amsterdam. The initiative should therefore meet the following description:

The hotel makes a demonstrably exceptional contribution to both the innovative range of accommodation on offer in Amsterdam and to a special aspect of the social, cultural or economic climate. Only if it really adds something to the hotel market in Amsterdam and its immediate surroundings will an exception be made’.

It is also remarkable that the initiator not only has to convince the municipality that his hotel will be an asset to the neighbourhood, but the local residents also play a role in this. The initiator will have to demonstrate with a thorough report that there is sufficient support for the project in the neighbourhood and that there will be a positive connection with that neighbourhood. In the final assessment, the impact on the neighbourhood will then be taken into account.

In addition, the new hotel will also be subjected to a sustainability test. The City of Amsterdam has adopted the Agenda for Sustainability in 2015. As a result, the municipality is encouraging entrepreneurs to take more sustainability measures than the minimum which are required by law. If an initiator of a new hotel wants to get the green light, he is expected to go for the highest achievable level and strive for continuous improvement.

Finally, the initiator is required to submit a detailed plan demonstrating the existence of social entrepreneurship. This social entrepreneurship is tested against the standards of the Performance Social Entrepreneurship Manual. In short, this means that the activation and employment of certain target groups with a certain distance to the labour market must be promoted.

If it is decided to grant a permit, all agreements made to comply with the assessment framework will be laid down as far as possible in the special provisions of the leasehold contract or private law agreement. Sanction agreements may also be made in this respect.

Examples of new hotels

In view of the extensive assessment framework, it is not surprising that this significantly slows down the growth of the hotel offer in Amsterdam. Nevertheless, a number of new hotels have been added in Amsterdam in the recent period under this assessment framework. For example, a hotel has been added that mainly focuses on the so-called generation Z (born between 1995 and 2010) where everything revolves around technology and digital comfort. Another hotel was located in a building that had been empty for 12 years. The hotel is inspired by the seventies and explicitly seeks the relationship with the city and non-hotel guests. Finally, there is a new hotel that is inspired by Tiny Houses, creating an opportunity to combine living and working in a homely setting.

Rotterdam

Between 2012 and 2016, the number of hotels in Rotterdam increased by 37%. The growth is mainly due to domestic visitors, but the number of foreign hotel guests also increased significantly.[4] In 2017 alone, Rotterdam will have 600 hotel rooms, while the construction of the Ahoy hotel in 2020 will yield an additional 250 hotel rooms. Not only is the number of hotel rooms growing, but the occupancy rate is also increasing in Rotterdam. Whereas in 2016 it was still 69.4%, in 2017 this had already increased to 74.2% with an even higher occupancy rate to be expected for 2018.

Assessment framework

Despite the growth that Rotterdam has experienced in terms of hotels, it is still open to new hotel initiatives. New hotel initiatives are assessed on two issues according to the assessment framework. Firstly, the spatial framework in which the municipality has designated places that it believes are best suited for hotel initiatives. In addition to the city center, Kop van Zuid, Ahoy and Hoek van Holland are also considered promising (but less than the city) locations. Secondly, the quality of the hotels are considered. These are assessed based on a scoring system with a minimum score per zone. In this way Rotterdam makes it easier for entrepreneurs to develop hotels in places in the city where it deems it desirable. In doing so, Rotterdam wants to encourage entrepreneurs to focus on the city centre.

The Hague

The number of hotel guests in The Hague is also rising strongly. In 2018 alone, The Hague will have eight hotels with a total of 1,000 extra hotel beds. In 2013, The Hague’s policy[5] was still aimed at less room for quantitative growth of hotel locations, but it has now (partly) come back to that.

Policy

The Hague is, in principle, favourably minded towards initiatives by private parties in the core tourist areas of Inner City and Scheveningen and will facilitate initiatives in these areas where possible. The Hague, on the other hand, is reluctant to facilitate initiatives outside the core tourist areas. Therefore, the ‘no, unless principle’ applies. It will not cooperate with necessary zoning changes unless the initiative has demonstrable added value for the city’s economy.  Only if it concerns a unique and special concept that The Hague does not have yet, is it prepared to make an exception.

Utrecht

In 2010 there was still a shortage of hotel rooms in Utrecht. At the time, the ambition was expressed to realise a thousand new hotel rooms in the city by 2020. It turned out that this number had already been amply achieved in 2017. In addition, a number of initiatives are still under consideration, which means that Utrecht now wants to curb its growth somewhat.

Policy

While at first Utrecht wanted to focus on the realisation of hotels in the city centre in 2015[7], in the meantime the pressure on the city centre has increased to such an extent that the municipality now wants to spread the hotels more over the city. Presumably, the preferred locations in the area development plans will be adjusted for this purpose. Utrecht still has a relatively large number of 3 and 4-star hotels that are mainly focused on the business market. It is for this reason that in addition to these star hotels, Utrecht wants to create space for innovative (and often small-scale) concepts that also have room for the lower budget segment. Where zoning plans do not directly provide for the construction of hotels, in some cases a change authority can be used. In that case, however, conditions can be set that relate to planning requirements, environmental quality and economy. Initiatives that conflict with the zoning plan can be authorised by means of a zoning amendment if they fit within the policy.

Conclusion

The number of hotel stays in major cities has grown considerably in recent years. On top of the leader board is Amsterdam, which now sees reason to want to curb this growth and has set up a strict testing framework for new hotel initiatives. For the time being, new hotel initiatives are still very welcome in the other major municipalities, although they are managed at certain locations and in some cases assessed on the uniqueness of the concept. This is probably due to the speed of today’s developments in the tourism sector municipalities will be more inclined to adjust or adjust their hotel policy in the mean time. A more extensive assessment framework, such as in Amsterdam, is one possibility. Rapidly changing municipal policy can also provide hotel entrepreneurs with the necessary challenges in plan development. A plan that can go ahead today may meet with resistance tomorrow or vice versa. In addition, more and more entrepreneurs will probably be called upon to develop innovative (and sustainable) concepts in order to gain a place in the hotel sector of the four major cities.

If you want to establish a hotel but you are in doubt whether this is possible under the municipal policy, for example, or if you need help with a notice of objection if an application has been wrongfully rejected, please contact M2 Advocaten.

Lawyer Ginio Beij (beij@m2advocaten.nl)

 

1] ‘The impact of the visitor economy on Amsterdam’, SEO economic research, October 2017.

2] Memorandum ‘Uitwerking Overnachtingsbeleid 2017 en verder’, October 2017.

3] See appendix 1 Area map, memorandum ‘Uitwerking Overnachtingsbeleid 2017 en verder’, October 2017.

4] https://evr010.nl/verkenning-2018/aantrekkelijk-voor-bezoekers-bewoners-ondernemers/rotterdam-aantrekkelijke-stad/

5] ‘Check in The Hague: Room service 2.0’, Hotelstrategie Den Haag 16 July 2013

6] ‘Check in The Hague: Room service 2.0’, Hotelstrategie Den Haag 16 July 2013

7] Update on market space hotel memorandum ‘Room With A View’ Utrecht February 2015

tape measure NVM

Realtors in the Netherlands must not apply double standards

The Supreme Court recently ruled that an NVM broker (NVM is the Dutch organsation for realtors) can be held liable for mentioning an (incorrect) living space in a sales brochure that has not been measured according to a measurement instruction laid down by the NVM. A clause in the sales brochure stating that no rights can be derived from information in the brochure does not detract from this liability.

 NVM measurement instruction

Since 2010, NVM brokers are obliged to measure the house according to a special uniform NVM measurement instruction.  In this way, the NVM wants to promote that customers know exactly where they stand in case an NVM broker gives an indication of the surface area. Despite this measure, unfortunately not all NVM brokers comply with this measurement instruction. The disciplinary board of the NVM therefore regularly reprimands members for mentioning a larger quantity of square metres than would be the case if the measurement instruction were properly carried out. The question is whether the broker has also acted unlawfully towards the buyer under civil law and if he can therefore be held liable.

Unlawful (also with standard exclusion clause)

In answering this question, the Supreme Court concurred with an earlier judgment of the Amsterdam Court of Appeal. The Court of Appeal ruled that an estate agent acts unlawfully if he states a larger living area than would be the case if he followed the measurement instruction, because the buyer of a dwelling may rely to a large extent on the fact that the measurement instruction was carried out in accordance with the measurement instruction. The measurement instruction, which the NVM has made compulsory for its members, is specifically intended to protect the interests of prospective buyers. An NVM broker cannot, therefore, simply use a different measuring method. The fact that a broker states in the sales brochure that no rights may be derived from measurements mentioned in the sales brochure is set aside by the Court of Appeal and the Supreme Court. “Such a standard statement is in itself not specific enough to undermine the confidence that the prospective buyer may derive from the mandatory nature of the measurement instruction”.

Exceptions

Although the starting point is that an NVM broker acts unlawfully if he does not comply with the established measurement instruction, this may be different when;

  1. the buyer had to understand from statements or behaviour of the realtor that a different measurement method was used;
  2. there are specific circumstances that should have led the buyer to doubt the stated area.

Did the buyer suffer any damage?

Finally, there may have been unlawful conduct, but there can nevertheless be no damage. In a case before the Court of Appeal of Arnhem-Leeuwarden, the real estate agent had also failed to comply with the measurement instructions used by the NVM. However, despite its smaller size, the house turned out to be worth more than the price originally paid for the house. Furthermore, the buyer could not prove that he had not bought the house for the same amount of money as he had known that the house was smaller. Therefore, the court of appeal rejected the claim for compensation now that there was in fact no question of damage.

Does your home not comply with what the real estate agent had measured? Then please feel free to contact M2 advocaten for free advice.

 

Lawyer Ginio Beij (beij@m2advocaten.nl)

rental law lawyer in Amsterdam

Rent Business premises: Substitution at 7:290 BW business premises

If a company wants to sell its business, it usually has an interest in also being able to transfer the lease to the buyer. But what if a landlord does not agree to the takeover of the contract? The law provides for so-called ‘substitution’ in the case of medium-sized business premises. This is a legal arrangement that may force a lessor to cooperate with the contract takeover. But that is not without conditions.

Substitution

Tenants of medium-sized business premises for, for example, retail, bars, restaurants, hotels, catering and craft businesses (Section 7:290 of the Civil Code) enjoy more protection than tenants of other business premises such as office spaces (Section 7:230 of the Civil Code). For example, not only is it more difficult for the lessor of a medium-sized business space to terminate the lease with the tenant, but under certain circumstances the lessor may even be forced to agree to a new tenant if this is in the interests of the previous tenant. This arrangement is included in Section 7:307 of the Dutch Civil Code, and is also known as substitution.

The underlying idea behind these regulations is that the value of a medium-sized business is largely linked to the location where the business is located. As a rule, these companies have built up a permanent clientele and provide the premises with the necessary inventory to receive their clients. If a potential buyer is unable to make use of those acquisitions and/or facilities because the lease contract is not continued, the sales value of the company decreases significantly. It is for this reason that a scheme has been set up specifically for medium-sized business premises that seeks to protect these interests.

Conditions

If a lessor does not voluntarily cooperate in the takeover of the contract, the lessee of a 7:290 BW business premises may apply to the subdistrict court for authorisation to put the new lessee in his place as lessee. A judge will assess such a request against the following criteria:

1) There must actually be a transfer of the business.

The primary objective of the contract takeover must be that the business is actually taken over and continued. If the new tenant takes over a supermarket, but does not have an interest in the inventory or the staff as well as current supply contracts, the claim for substitution will be rejected by the court. In this example, the new tenant is actually starting a new business and therefore there is no business transfer.[1]

2) The tenant has a substantial interest in the transfer.

This may include illness or reaching retirement age, as a result of which the tenant can no longer continue the business. Serious financial problems can also be of major importance. An example of a claimed interest that was not judged by the court to be sufficiently important was a tenant’s claim that he no longer saw any opportunities for growth despite the fact that his business in its current form was profitable[2].

3) The new tenant must be able to provide sufficient guarantees for the fulfilment of the obligations arising from the lease.

The fact that a lessor may be forced to accept a new lessee constitutes a major infringement of the freedom of contract. For this reason, it is very important that sufficient guarantees can be provided that the new tenant is able to fulfil the obligations arising from the lease. In addition to sufficient solvency, factors such as reliability and how an entrepreneur has acted in the past are also important.

Weighing up the interests

If the tenant meets all the above conditions, the substitution will in principle be granted. Nevertheless, all the circumstances of the case will be taken into account in the final balancing of interests. This may therefore mean that the court does not agree to the substitution despite the fact that the tenant meets all the conditions. The judge will have to weigh the interests of the lessor against the interests of the (former) lessee. An example of a landlord’s interest may be that a newly proposed tenant does not contribute to an intended necessary new impulse for a shopping centre. This could be a reason to reject the request for substitution.

Tips for tenants and landlords

– As the lessee, submit the claim for substitution in time and do not wait until the business is transferred.

– As lessee, ensure that the conditions are met with certainty. This means having an interest in nominating a reliable and solvent new tenant.

– It is very important for the landlord that the new tenant explicitly takes note of all agreements made with the old landlord. It is therefore probably wise to put verbal agreements with the old tenant on paper before agreeing to take over the contract.

– As the lessor, do not hesitate to put forward your own specific interests in the event of a lawsuit. In particular, the balancing of interests is extremely casuistic in nature.

Do you have any further questions about substitution? Please feel free to contact M2 lawyers for advice.

Lawyer Ginio Beij (beij@m2advocaten.nl)

 

Rent Business premises: Substitution at 7:290 BW business premises

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Lease of business premises: Lease contract does not automatically pass in the event of a change in legal form

Starting entrepreneurs often start as a one-man business or VOF (general partnership) and then, when turnover increases, switch to another legal form such as a BV (limited liability company). The lessor is not always informed of this change, let alone explicitly asked for permission. In principle, this means that the lease will not have been transferred to the new legal entity either. What are the possible consequences of this?

An entrepreneur will not always ask explicit permission from the lessor if a new company structure is formed. A lessor will often not make a problem of this. At least, as long as the rent continues to come in.  But the fact that the landlord continues to receive these payments does not automatically mean that the landlord has agreed to the contract being taken over by the new legal form.[1] This distinction is particularly relevant if the new legal form is no longer able to pay the rent as was shown in the following case study.

 Case study

An existing VOF entered into a tenancy agreement with the landlord.[2] The tenancy agreement was concluded for a period of five years and then extended for another five years. During this period, the VOF changes its business structure. The VOF becomes a BV (Limited liability company) and informs the lessor of this by letter. The lessor does not respond to the contents of the letter and continues to receive the rentals transferred by the BV. A few years later the BV goes bankrupt. However, the lessor states that he has never concluded a lease agreement with the BV and holds the former partners of the original VOF jointly and severally liable for the overdue rent payments. The partners argue that the VOF no longer exists and that they also informed the lessor of this by letter. Now that the lessor has not objected in all that time, they have assumed that the lessor has agreed to the takeover of the contract. According to them, the lessor can therefore only appeal to the (bankrupt) BV.

Contract takeover (6:159 Dutch Civil Code)

The court must assess whether in this case a contract was taken over as referred to in Section 6:159 of the Dutch Civil Code. In short, has the lease been legally transferred to the BV? According to Section 6:159 of the Dutch Civil Code, the following conditions must be met for a contract to be taken over:

– A deed in which the tenant transfers his legal relationship to the new tenant;

– Unambiguous cooperation of the lessor in the takeover of the contract (however, this cooperation does not necessarily have to be in writing).

In the case at hand, there was a deed showing that the VOF wished to transfer the lease to the BV, but the lessor never unambiguously cooperated in a contract takeover. It is true that the tenant wrote to the lessor, but the lessor then never explicitly stated that he agreed to a takeover of the contract. The former partners were therefore still jointly and severally liable for the rent arrears.

Incidentally, if a partner leaves the company, he remains jointly and severally liable as long as the lease is continued unchanged by his former partners.[3] It is therefore important for the retiring partner that the landlord explicitly agrees to the contract being taken over by the former partners so that the retiring partner is relieved of his liabilities.

Conclusion

Tenants of business premises would do well to ask the landlord’s explicit consent if they want the lease, and hence the liability, to be transferred to the new legal form. For a lessor, on the other hand, it is important to gain a good understanding of the financial position of this new legal form before agreeing to a contract takeover.

Are you looking for legal support in the transfer of your business to another legal form or has your tenant changed legal form and would you like to seek legal advice? Feel free to contact M2 Advocaten.

Attorney at law Ginio Beij (beij@m2advocaten.nl)

 

1] Hof Amsterdam 12 November 2013, ECLI:NL:GHAMS:2013:5220

2] Rb Dordrecht 30 July 2012, ECLI:NL:RBDOR:2012:BX5073

3] Ho f ‘s-Hertogenbosch 16 September 2014, ECLI:NL:GHSHE:2014:3642