Supreme Court: eviction agreement no rent despite agreement on compensation

The Supreme Court handed down an important ruling last Friday. The ruling gives landlords (and to some extent their tenants) some breathing room. In the judgment (ECLI:NL:HR:2025:167) has been determined that an agreement stating that one party may continue to use the leased property for a period of time for a fee, but must vacate at a certain time, does not automatically qualify as a rental agreement. The judgment is important, because case law up to now has followed a rather rigid policy: if a property is given in use against payment, this generally does qualify as rent. This meant that such an agreement could quickly be regarded as a (new) lease and that the ‘tenant’ then enjoyed rent protection. The judgment now gives some leeway in this respect. Rental law attorney Robert van Ewijk explains the significance of the ruling.

The case: no continuation of rent by children of deceased tenant

The case before the Supreme Court involved a matter in which a tenant of Portaal housing corporation had died. The children could not claim a continuation of the tenancy by virtue of Art. 7:268 paragraph 2 BW. Portaal wanted to accommodate the children, so it agreed with them that they could stay in the home for a while while they looked for another home. That went wrong. The children took the position that this agreement should be seen as a rental agreement. Therefore, they would be entitled to rent protection. Portal has therefore given them subpoenaed and demanded that they vacate the property. The subdistrict court rejected that claim on the grounds that there was a lease. On appeal, Portaal was vindicated. The Supreme Court agreed with the district court.

Starting point: use + payment = rent

The law defines the lease as “the agreement whereby one party, the lessor, undertakes to provide the other party, the lessee, with a property or part thereof for use and the lessee undertakes to provide consideration.” If the agreement meets that definition, then in principle it is a rental agreement. It does not matter what the agreement is called. Nor does it matter whether the parties actually wanted the agreement to be covered by the legal regime of rent.

As a result, if the purpose of an agreement is to put an object into use and a consideration applies, it is therefore a rental agreement. It does not matter if that consideration is then classified, for example, as a ‘user fee’ or ‘expense allowance. If that lease then has a termination date that violates the lease protection rules, then that provision is void and the landlord is out of luck.

Exception: intent of parties

So now the Supreme Court has added an important nuance to that. Namely, the Supreme Court has ruled that although the contract may in itself meet the legal description of a rental agreement, it may still not qualify as such. For this, the given circumstances of the case, the content and scope of the contract must be considered. The exact situation that the parties intended to regulate must also be examined. In addition, it must be assessed whether the conclusion that the agreement not qualifies as a lease, can pass muster given the strict protections that lease agreements are subject to. The Supreme Court:

“In assessing whether this exception arises, it is also important for which situation the parties intended to regulate and whether a characterization other than as a lease in that situation is compatible with the mandatory protection regime for leases relating to residential premises.”

In other words, the protection that the legislature intended to give tenants may not simply be circumvented. However, at the same time, the Supreme Court finds that there may be circumstances in which it is not necessarily necessary to conclude that there is a lease. The corresponding protection then also does not apply.

When can the exception apply?

The Supreme Court found that the exception occurred in this particular case. What was important was that the very purpose of the agreement was to ensure that the children were not would be out on the street and could actually stay in the home longer. This while they were not actually entitled to do so. Their position was thus protected by the actions of the landlord. The landlord refrained from eviction of the leased property enforce.

“In such a case, the mandatory protection regime for leases does not preclude that an agreement that the occupant will be allowed to remain in the dwelling for some time in order to look for other living quarters for a fee, and thus the owner waives eviction for as long as that is the case, is not considered a lease.”

Settlement agreement to terminate lease also (always) a solution?

Another possibility explicitly mentioned by the Supreme Court is the conclusion of a settlement agreement. Indeed, in a settlement agreement, agreements can be made in which parties waive rights. Even if that would be contrary to mandatory provisions. However, this does not mean that you can simply settle everything with a settlement agreement. In fact, that settlement agreement can also qualify as a rental agreement. After all, that is the main rule. The question of whether the exception situation arises must then again be judged based on the facts of the specific case.

Supreme Court ruling on lease termination agreement gives breathing room

In addition to giving landlords more room to negotiate with residents about vacating the leased property, the ruling also gives residents more air. Indeed, as a result of increasingly stringent regulations, landlords are often forced to hold tightly to the end date of a lease. Currently, in fact, fixed-term rental agreements still exist with respect to housing. In fact, until July 2024, these were allowed to be entered into. If such an agreement is renewed, then that renewal is by law for an indefinite period of time and thus the tenant enjoys rent protection. Landlords are therefore reluctant to make agreements on a slightly later eviction date than that stated in the agreement. Indeed, such an agreement could be seen as an extension of the lease.

Rent law lawyer on eviction agreement

With last Friday's Supreme Court ruling, under circumstances, that is a thing of the past. Under circumstances, because it depends on the specific facts, the nature of the agreement and its scope. So get advice from a lawyer specializing in rental law. Do so before entering into an eviction agreement with the occupants of one of your properties. To do so, take contact with us.