It happens more often than the brochures suggest. A plot is bought from a seller whose title turns out to cover less than the fence did. A villa is built a few metres beyond the surveyed line. An inherited house has stood for twenty years on a parcel that belongs, on paper, to a cousin who emigrated. In each case the building exists, somebody paid for it, and the register says the land belongs to someone else.
Montenegrin law does not leave this to be argued from first principles. Articles 41 to 45 of the Zakon o svojinsko-pravnim odnosima set out a matrix: who knew what, who objected and when, and which of the two — land or building — is worth more. The outcome turns on those facts, and on clocks that start running the day construction finishes.
Before anything else, one warning. Search this subject in English and the first results are commentary on the civil law of jurisdictions that have nothing to do with Montenegro, some of them stating that the landowner cannot force removal. In Montenegro, 🔴 article 42 expressly gives the landowner the option to demand demolition and restoration of the land. German-language material will steer you toward Erbbaurecht, a different institution entirely. Every rule and every number below is from the Montenegrin text.
Where this sits in the law
Article 29 lists the ways ownership is acquired by operation of law: creating a new thing, joining, mixing, building on another's land, separating fruits, acquisitive prescription (održaj), acquisition from a non-owner, occupation, and other cases the law provides.
That placement matters. This is not a claim you bring to be granted a right; it is a rule that has already allocated ownership by the time anyone reaches a courtroom. The litigation is about establishing which limb applies and what compensation follows.
The four combinations
Builder in good faith, landowner in bad faith
🔴 Article 41. A person who builds a building on land in which another holds ownership acquires ownership of the building and of the land on which it stands, as well as of the land necessary for the regular use of that building — if they neither knew nor could have known that they were building on another's land, and the landowner knew of the construction and did not object without delay.
Both halves are required. The builder's ignorance must be excusable, and the owner's silence must have been informed silence. An owner who watched a house go up on their parcel and said nothing loses the land.
What the owner keeps is a money claim, and it is time-limited: they may demand that the builder compensate the value of the land at its market price as at the time of the court decision, within three years from learning of the completed construction, and in any event within ten years of completion.
Note which price is used. Not the price when the foundations went in, not the price in the sale contract that started the problem — the market price at the date of the decision. In a rising market that favours the owner; it is also why delay is not neutral for either side.
Builder in bad faith, landowner in good faith
🔴 Article 42. If the builder knew or must have known that they were building on another's land, and the owner objected immediately, the landowner may demand:
- that ownership of the building be awarded to them; or
- that the builder demolish the building and restore the land to its previous condition; or
- that the builder pay the market price of the land.
In each of those cases the owner is also entitled to damages.
If the owner takes the building, they must compensate the builder its value at the average construction price for such a building in the place where it stands, as at the time of the court decision.
🔴 And then the clock that decides most of these cases: the owner may exercise that right of choice at the latest within three years from the completion of construction. After that period, the owner may only demand payment of the market price of the land.
Three years after the roof goes on, demolition stops being available. The remedy narrows to money.
Both in good faith
🔴 Article 43 covers the situation where the builder is in good faith and the owner did not know about the construction — so neither party can be blamed. Here the statute compares values.
- Where the building is worth significantly more than the land: the building together with the land belongs to the builder, who owes the owner compensation at the market price of the land.
- Where the land is worth significantly more: on the owner's application the court awards the building to the owner, who must compensate the builder the average construction price of such a building in that place. That application must be made within three years of completion.
- Where the two values are approximately equal: the court awards the building — or the building and the land — to the owner and the builder, 🔴 taking account of their needs, and in particular of their housing circumstances, with compensation as in the first limb.
The third limb is the one that surprises foreign buyers most: the court is directed to weigh who needs a home, not only who holds paper.
Both in bad faith
Article 44. Where both parties are in bad faith, the rule prescribed for a bad-faith builder and a good-faith owner applies — that is, article 42, with its three-year window.
When the materials belonged to someone else
Article 45. The rules on building on another's land apply also where the builder used a third party's material without the material owner's permission. That owner is entitled to the value of the material and to damages. If the parts used can be separated without damage, the owner may demand their return — 🔴 within two months of learning of the facts, and at the latest within one year.
Two months is short. It is the tightest deadline in this part of the statute, and it belongs on the checklist of anyone who supplied materials to a project that then went wrong.
Building on your own land
For completeness, because these are the provisions that make the exceptions legible:
Article 46. The landowner acquires ownership by building of the structure they built in accordance with the law.
Article 47. A landowner who built on their own land becomes owner of the building even where they used another's material, provided the building was constructed in accordance with the law. The material owner has a right to the value of the material and to damages; where parts can be separated without damage, they may demand the return of those parts, and damages.
The qualifier does a great deal of work in both articles: in accordance with the law. It is the hinge between this chapter and the entire permitting and legalisation layer.
Where the boundary itself was crossed
There is a narrower variant, where the building stands on the builder's own land but pushes over the line onto the neighbour's parcel. That case has its own provisions — articles 48 and 49 — and its own logic, including the point that good faith does not shield an encroaching structure from a restitution claim. We have set that variant out separately in boundary and survey disputes, which is the page to read if what crossed the line is a wall rather than a whole house.
One provision from that group belongs here too, because it is the safety valve for the whole chapter:
🔴 Article 50. Restitution to the previous state may also be demanded where the landowner warned the builder in time, or where the builder was otherwise in bad faith. By way of exception, the court will not permit restitution if it finds that this would not be socially justified in the circumstances of the case — having regard in particular to:
- the negligible value of the occupied land compared with the size of the damage demolition would cause the builder;
- the financial circumstances of the parties; and
- their conduct during the construction.
Read that as the answer to the question everybody asks: will they really make me knock it down? Sometimes; and the statute names the factors that decide it. Conduct during construction is one of them, which is why the paper trail of warnings, objections and replies is worth as much as the survey.
The signal that appears in the register
The cadastre does not merely record the outcome; in one place it records the problem.
🔴 Article 64 of the Zakon o državnom premjeru i katastru nepokretnosti provides that the person registered as holder of rights on a building is: the builder who built the building in accordance with the law; the builder to whom a building permit or use permit was issued; or the builder of a building that was not built in accordance with the law, or was built across several parcels, or on another's land — with the entry of an annotation of a burden in the G sheet of the folio.
That third limb is the early warning. A structure that sits across parcels or on somebody else's land is meant to carry a G-sheet annotation, and a buyer who reads the G sheet rather than only the ownership entry may see the problem before paying for it.
Article 65 adds the parallel entry for construction in progress: a building under construction is entered in the G sheet as an annotation of building on the parcel where construction began, recording the investor, the technical documentation, the building permit, the deadline for completing the works and other facts of importance.
What to do about it
- Date the completion of construction. Articles 41, 42 and 43 all hang their three-year windows on it, and article 41's outer limit of ten years runs from it as well.
- Reconstruct who knew what, and when. Article 41 needs the owner's informed silence; article 42 needs the owner's immediate objection. Emails, messages and municipal filings are the evidence that decides which article you are in.
- Get the two valuations early. Article 43 turns on whether the building or the land is worth significantly more, and article 42 on the average construction price. These are expert questions, and the statute fixes the valuation date at the court decision.
- Read the G sheet, not just the ownership entry. Article 64 puts the annotation there, and it is visible before you buy.
- If you supplied materials, calendar two months. Article 45's window for demanding separable parts back is two months from knowledge, one year at the outside.
- Do not assume demolition is off the table, and do not assume it is on it. Article 42 offers it; article 50 can refuse it on grounds the statute lists.
- Keep the conduct record. Article 50 makes the parties' behaviour during construction an express factor.
On the neighbouring frameworks: rights of way and servitudes on your plot, co-ownership shares and forced division, and, for the boundary-crossing variant, boundary and survey disputes.
Whose side we are on, and how we are paid
RoNa Legal DOO works for owners and buyers, not for developers, agents or sellers. We are paid by the client we act for and by nobody else in the transaction: no commissions, no referral fees, no share in the contract we are reviewing.
Work that requires representation before a Montenegrin court or state authority is carried out by an advocate admitted to the Montenegrin Bar. Our role is the preparatory and advisory layer: fixing the completion date, assembling the record of who knew and who objected, identifying which of articles 41 to 44 the facts fall under, and telling you which remedies are still open and for how long.
If a building on your file is standing on the wrong parcel
Send us the list nepokretnosti with the G sheet, the survey or geodetic report if one exists, the building and use permits, and any correspondence with the neighbour or the seller. From those, the first answer — which article applies, what it produces, and which clocks are still running — comes quickly.
