Termination of Tenancy Agreements

General rule

Let’s start with the general rule. Under Dutch contract law, each party has the right to terminate a contract in whole or in part if the other party fails to fulfil its obligations, unless the breach, given its particular nature or minor significance, does not justify termination (Article 6:265 of the Dutch Civil Code). Termination can take place either out of court or through legal proceedings.

Termination of tenancy agreements

This general rule also applies to tenancy agreements. However, if the tenancy agreement relates to a constructed immovable property, a mobile home, pitch or mooring, the tenancy can only be terminated by the courts (Article 7:231 of the Dutch Civil Code). Constructed immovable property includes, for example, residential properties, retail premises, or office buildings. Therefore, court proceedings are required to terminate such tenancy agreements in situations such as significant rent arrears or nuisance caused by the tenant.

For tenancy agreements involving undeveloped land, vehicles, or equipment such as printers, this requirement does not apply, and out-of-court termination is possible.

Exceptions to Article 7:231 of the Civil Code

Although the default position for constructed immovable property, mobile homes, pitches, and moorings is court termination, the law does provide two exceptions where out-of-court termination is permitted:

1. When public order has been seriously disturbed, there is a threat of such disturbance, or if the property has been closed by the municipality due to violations of the Opium Act;
2. When a defect exists that renders the expected enjoyment of the property impossible for the tenant, and the landlord is not required to remedy the defect because it is either impossible or would incur unreasonably high costs (Article 7:210 of the Dutch Civil Code).

The first exception includes situations such as explosives being placed near the property, illegal prostitution, or the discovery of a cannabis plantation in the premises. In such cases, the mayor may order the closure of the property. During the closure period, the landlord can terminate the tenancy agreement out of court. The same applies to the second exception, for instance, when the property has been destroyed by fire. In such a case, both the landlord and the tenant may (although not always) proceed with out-of-court termination of the tenancy agreement.

More information

Do you have questions about the (out-of-court) termination of a tenancy agreement? Please feel free to contact me or one of the other specialists at GMW lawyers to discuss your options.