Commercial agreements under Dutch law
If you have chosen to establish your business in the Netherlands or to open an office in the Netherlands, you will be confronted with the Dutch legal system. And off course Dutch contract law.
Contracts under Dutch law have consequences for the legal position of your company in commercial agreements (with customers and suppliers).
In this article, we provide an overview of various aspects.
General information
Principles Contract Law
Every contract is governed by the rules set out in Books 3 and 6 of the Dutch Civil Code, as well as by various rulings and judgments handed down in recent years. Below is an overview of various aspects that apply to every contract.
An important aspect of Dutch law is that agreements are not subject to any formal requirements.
This means that an agreement between parties can be concluded either verbally or in writing. It goes without saying that a written agreement generally has greater evidential value.
Offer and acceptance
Furthermore, an agreement is concluded through an offer and acceptance. It is therefore important to record both aspects properly and in full, particularly if the parties are entering into an agreement for the first time. By recording these aspects properly, the risk of subsequent disputes about the legal validity of a contract is greatly reduced.
Reliance
The doctrine of reliance (in Dutch: “Wilsvertrouwensleer”) also plays an important role here. This doctrine essentially means that a party who could reasonably rely on the appearance of the other party’s statement, is protected. This means that if you could rely on the other party’s behaviour to believe that they also had the intention to actually conclude an agreement, then it is very likely an agreement exists. Here too, it is important to properly record what the parties wanted.
Putting the agreements between the parties in writing therefore makes things easier for everyone. This is certainly the case when interpreting an agreement, when the parties to a dispute each give a different interpretation to a provision.
Courts
A court will primarily assess the text of the agreement. However, if the agreement does not provide a solution to the conflict that has arisen, the so-called Haviltex standard will be applied. This is the name of an important ruling handed down by the Supreme Court of the Netherlands.
In this ruling, the Supreme Court ruled that when interpreting an agreement, consideration must be given to what the parties could reasonably expect from each other. All circumstances of the case must be taken into account. Against this background, it is always a good idea, especially with new clients, to discuss each agreement thoroughly and to review standard agreements to ensure that they comply with the agreements between the parties.
Agreements and General Terms and Conditions
As lawyers, we will primarily work with you to ensure that the agreements made are correctly recorded. We will also look at the background of the parties and the background of the agreements made to prevent situations from arising that have not been taken into account and for which other agreements need to be laid down in the agreement.
When drawing up agreements, there are various rules of mandatory law, which means that parties cannot or may not exclude them. We can inform you about this for each agreement.
It is also advisable to draw up General Terms and Conditions that apply to every agreement you enter into. In these general terms and conditions, you can lay down the conditions under which you always wish to contract with your contractual partner. Drawing up General Terms and Conditions is custom work that we, as lawyers, can do for you, but on balance it only needs to be done once. Once drawn up, you can use them at any time.
It goes without saying that General Terms and Conditions can be revised from time to time to check whether they still reflect the current situation.
Finally, it is wise to consider the applicable law, which court has jurisdiction to rule on the agreement in the event of a dispute, and whether previous agreements or commitments that are not included in the agreement are excluded or not (the Entire Agreement Clause).
We can also advise you on this.
The existence of different types of contracts
It is worth noting that the Dutch Civil Code treats certain contracts separately. For example: Sales and Exchange Agreements (including consumer sales), Credit Agreements, Lease Agreements, Agricultural Tenancy, Insurance Contracts, and Service Agreements.
All are described in the Dutch Civil Code and all have different specific aspects.
Identifying the type of contract and determining which specific provisions or conditions should be included can already provide much-needed clarity.
Tailor-made advice
As described above, there are several aspects to an agreement under Dutch law. However, as is the case in other jurisdictions, there is a tailor-made solution for every agreement or question.
GMW lawyers have extensive experience in drafting agreements and thinking creatively about solutions for recording agreements.
Of course, we can also assist you if you ever have any questions regarding the interpretation of an agreement.
More information
Do you need help drafting or reviewing a contract under Dutch law? Or are you unsure whether your agreements or general terms meet legal requirements? Feel free to contact us to discuss your situation.
