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Owners Association (VvE): Owner of crawl space by statute of limitations?

Earlier we discussed the situation in which an apartment owner wants to excavate an existing crawl space in order to turn it into a fully-fledged basement, for example. But what if a previous owner has enlarged his basement by adding an existing crawl space and the Owners Association (OA, in Dutch “Vereniging van Eigenaren”, abbreviated: VvE) has failed to act against this for 25 years?  Can an apartment right be enlarged by statute of limitations? In this blog we describe a practical case in which this issue arose and then discuss the court’s verdict.

Case study

A buyer has bought an apartment with attached basement space. The previous owner has enlarged the basement space by creating a passage to the crawl space below. The crawl space originally belongs to the communal area of the VVE. According to the previous owner, for 25 years the VVE has never made a problem of using this crawl space as storage space. He is therefore convinced that this space has become his property because of the statute of limitations. The buyer, on the other hand, finds it better to write to the VVE and proposes to buy the space from the VVE. Enquiries with neighbours had taught him that in similar cases the VVE had sold common parts without problems.

However, the buyer doesn’t get the outcome that he expected. The VVE refuses to sell him the crawl space. In addition, he is asked to deliver the crawl space within two weeks in the original state. The buyer did not comply with the request of the VVE and then defended himself by stating that the crawl space in question had become part of his apartment right as a result of prescription.

Limitation period

Although there there are various opinions about this, a common part of the VVE can, in principle, be transferred to a private part of a separate apartment owner due to statute of limitations. This requires that the apartment owner actually behaves for a certain period of time as if he is the owner of the common part and the VVE is aware that the statute of limitations has begun to run. Furthermore, this period must be uninterrupted. How long this period should be before prescription depends on each case.

In the case above, in principle, two forms of prescription may apply; acquisitive prescription or liberating prescription. Acquisitive prescription is when a person has owned an immovable property in good faith for a continuous period of 10 years. You are only in good faith if you could not have known that the property in question was not your property. Because ownership of real estate in the Netherlands is recorded in the land register, this form of prescription is rare. If there is no good faith then a period of 20 years of uninterrupted possession is required before the person who has appropriated the property can legally call himself owner. Incidentally, this possession may be interrupted if the VvE gives notice in good time that it does not agree to the possession.

Court ruling

The court took into account that the VVE had not been informed about the crawl space being used by the previous owner. This owner created a passageway from his own basement space that could not be observed by the VVE. If there is no public ownership, the limitation period will only start to run when the VVE has been informed of the situation, according to the court. In this case there was no reason to assume that the VVE had become aware of the use of the crawl space earlier. The fact that a local resident was able to confirm that the previous owner had actually been using this passageway for 25 years does not alter the fact that the VVE was not necessarily aware of this. The District Court’s judgment is therefore that there is no question of prescription. The crawl space remains the property of the VVE.

Conclusion

Although it turned out differently in this case, it can be deduced from this judgment that the ownership of a common space can in principle be transferred to a separate apartment owner by statute of limitations.  It is therefore important for an VVE to respond in good time if it becomes aware of the occupation of a communal area. For an apartment owner who wishes to invoke prescription, it may be wise to have the new situation included in the deed of division in order to avoid discussions later. This case shows that sometimes it is better not to let a sleeping dog lie. It might bite if you do.

Do you have questions about prescription within the apartment law or are you looking for advice in a similar situation? If so, please feel free to contact M2 Advocaten.

Lawyer Marius Rijntjes (rijntjes@m2advocaten.nl)

 

deserted area 2

Lost property due to statute of limitations: right to compensation or return?

The Supreme Court issued a judgment in 2017, in which it was ruled that in the event of expiry of the statute of limitations, a claim for damages or even restitution is possible.

The case before the Supreme Court concerned a resident of the municipality of Heusden who had fenced off part of the forest plot behind his plot by means of a fence. More than 20 years later, the municipality asked the resident to cease the “illegal use of municipal land”. The inhabitant does not intend to do so and states that he has owned the fenced off part for more than 20 years and has become the owner through a liberating statute of limitations.

The resident is right. Fencing off a part of the forest plot is an act of possession and that was known. Whether or not the municipality could only become aware of this after investigation (read: inspection) is irrelevant. In conclusion: the inhabitant has become the owner of the fenced off part of the forest plot. Is this the end of the matter? No, it is not.

The Supreme Court draws attention to the possibility that a person who has lost his property as a result of liberating statutes of limitations may bring an action for wrongful act. After all, a person who takes possession of another person’s immovable property is acting unlawfully. In such a case, compensation in kind could even be claimed, i.e. restitution of the immovable property.

In this respect, the Supreme Court notes that the claim for compensation itself is also subject to prescription: this claim lapses 5 years after the person who has lost his property has become aware of the loss (e.g. by a court ruling) and in any case 20 years after the loss of property. In the case of compensation in kind, this means that the owner could recover his property up to 25 years or 40 years after taking possession.

Lower case law (handed down after the Supreme Court’s ruling) now shows that a claim for restitution will not be granted just like that. The need for extradition will have to be properly substantiated. For the time being, compensation in money seems to be the starting point.

Incidentally, a person who has purchased immovable property from someone who has acquired the immovable property by way of liberating statute of limitations need not be afraid of a tort claim by the original owner. The original owner can only claim damages from the person who acquired the immovable property by way of liberating statute of limitations. After all, this is the person who acted unlawfully towards the original owner.

Please feel free to contact us.

Marius Rijntjes (rijntjes@m2advocaten.nl)