Suppose that you are an expat, you are married, you live in the Netherlands, your parents live abroad and you have received a considerable inheritance from them. You get divorced. Is your ex-spouse entitled to a part of this inheritance?
How are inheritances divided under Dutch law?
If Dutch law applies to your matrimonial property regime and you do not have a prenuptial agreement, you are married in community of property if you were married before 1 January 2018. On that date the Dutch law changed. Everything that you and your spouse have is part of this community. Thus also your inheritance. In the event of a divorce, this community of property is divided on a 50/50 basis. This means that your inheritance must also be shared. This can be prevented by making use of the so-called ‘exclusion clause’.
What is an exclusion clause?
It is a clause in the will of the testator/testatrix which stipulates that everything that his/her heir gets shall not fall under any community of property. If your parents have included this clause in their will then you are safe: in the event of a divorce, your spouse has no right to your inheritance. Since your parents live abroad, the chance is big that they have never heard of this exclusion clause and that it is missing from their wills. Then what? Or what if they have not made a will?
Are there any exceptions to the requirement of an exclusion clause?
Actually, no. Is this also the case if, in accordance with the law applying to the inheritance from your parents, the inheritance does not fall under any community of property? Your parents could not have known that they should have included an exclusion clause in their wills in order to prevent you from having to share your inheritance with your spouse. Until recently, judges have made an exception on the grounds of the ‘standards of reasonableness and fairness’ by ruling in such situations that the inheritance despite the absence of the exclusion clause does not need to be shared.
What does the Supreme Court think of this?
The Supreme Court is the highest judicial body in the Netherlands. On 17 February 2017, the Supreme Court ruled that the sole fact that, in accordance with the applicable foreign law regarding inheritances, an inheritance goes exclusively to the heir, is not sufficient in order to be able to make an exception to the Dutch system of dividing everything on a 50/50 basis (ECLI:NL:HR:2017:276). This is not good news for expats. In principle, it means that if Dutch law applies to your matrimonial property regime and you have no prenuptial agreement and your parents have not included an exclusion clause in their wills (or have not made a will), then, in the event of a divorce, you must share your inheritance. The Supreme Court has not totally ruled out the possibility that in particular cases, things may be different. But do not count on this. The Supreme Court considers that if you want to call upon ‘standards of reasonableness and fairness’, you need to prove that your parents assumed that your inheritance should not fall under community of property. This is of course a difficult task.
Can you ensure that you do not need to share your inheritance?
Yes, you can certainly do so either by getting the notary to prepare a prenuptial agreement (certainly in the situation where you have already received an inheritance before your marriage) or by instructing your parents to include an exclusion clause in their wills. Everything said before also applies for gifts.
If you have any questions, or you’need further advice on protecting your inheritance, please contact me.