This time, it concerns a blog that does not only affect our real estate practice. The Supreme Court judgment discussed in this blog affects all legal relationships in which parties owe each other mutual debts and wish to set them off against one another. On 23 January 2026, the Supreme Court issued a landmark ruling on the relationship between set-off and limitation (prescription). The judgment clarifies how far the possibility of set-off extends when a claim has become time-barred. In doing so, the Supreme Court provides a general framework that is relevant to all continuing agreements in which payment obligations play a role.
The Dutch Civil Code provides for set-off as a way for obligations to be extinguished. Under Article 6:127 of the Dutch Civil Code, a debtor may set off his debt against a counterclaim, provided he is entitled to enforce performance of that counterclaim. As a rule, limitation (prescription) forms an obstacle in this regard: once a claim has become time-barred, it can no longer be enforced in court.
However, Article 6:131 of the Dutch Civil Code qualifies this rule by stipulating that the right to set off does not end due to limitation. This does not mean that limitation automatically creates an independent basis for set-off. The provision is intended to prevent a debtor who was already entitled to set off from losing this possibility merely because the creditor did not bring a claim in time.
In legal scholarship and lower case law, this exception has been interpreted in different ways:
Assume a tenant has a €20,000 damages claim against the landlord due to defects in the leased property. The tenant takes no action, and the claim becomes time-barred. The lease agreement is then terminated, and upon handover the landlord identifies defects in the property, resulting in €25,000 in damages. The tenant then only pays €5,000 to the landlord, invoking set-off. The landlord disagrees. The three possible outcomes were:
The Supreme Court provides clarity and rules that, based on Article 6:131 of the Dutch Civil Code, the right to set off a time-barred claim must have existed before the limitation period expired. If the counterclaim only arises after that moment, set-off is not possible. In essence, the right to set off does not end due to limitation, but a time-barred claim cannot give rise to a set-off right.
In the earlier example, the tenant is therefore not allowed to set off and remains obliged to pay the remaining €20,000 to the landlord.
Vigilance and action are therefore required from the creditor. One must be aware of limitation periods and act in time. Once a claim has become time-barred, this cannot be reversed. This applies even if the claim is beyond dispute and acknowledged by the other party.
Do you have questions about (contractual) limitation periods and whether set-off is still possible? At De Clercq Lawyers we are happy to assist you.
Do you have questions about (contractual) limitation periods and whether set-off is still possible? At De Clercq Lawyers, we are happy to assist you. Please contact Joyleen Verhoek or Fiene Stolp, or one of our other specialists within the Real Estate & Government team!
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