WILLEMSTAD – The Association of Owners (VvE) of Coral Estate is entitled to impose a contractual fine of 50,000 US dollars on a plot owner who failed to complete construction of a home within the agreed timeframe. The ruling was handed down on appeal by the Gemeenschappelijk Hof van Justitie.
The case concerns a plot within the Coral Estate Resort where the owner did not finish building a residence within the period stipulated in the VvE’s statutes and general regulations. Under those rules, property owners are required to complete construction within a fixed timeframe, with a contractual penalty of 50,000 dollars applicable if the deadline is exceeded.
In the appeal proceedings, the owner and associated partners argued that the construction deadline was unclear, that delays were caused in part by the Covid-19 pandemic and illness, and that the fine should therefore be reduced. The court rejected those arguments.
According to the ruling, the construction obligation set out in the VvE regulations was sufficiently clear. The home was required to be completed no later than two years after the issuance of the first building permit. The court held that the later issuance of a second permit or internal circumstances leading to delays did not alter that obligation.
The court also dismissed the request to reduce the fine. It found that the VvE had already granted multiple extensions and additional time before deciding to impose the penalty. The amount of the fine was deemed not excessive and was considered appropriate to prevent plots from remaining undeveloped for extended periods, which could undermine the resort’s overall planning concept.
Because the plot is owned by a general partnership, the individual partners were also found to be personally liable for the fine. They have been ordered to pay the amount jointly and severally, and were additionally ordered to cover the legal costs of the appeal proceedings.