have you suffered damage or have you been held liable for damage?
Dutch liability law
The basic principle under Dutch liability law is that every person bears his or her own damages. A person can only be held liable for part of another person’s damages if there is a basis either in contract or in law for such liability. Both types of liability are regulated in the DCC (“Burgerlijk Wetboek”). Do you have damage and would you like to recover it from a party that is liable for it? Or have you been held liable for paying damages yourself? Ask our legal expert to review your case.
Article 6:74 of the Code stipulates as a basic rule that a party is liable for all the other party’s damages resulting from the first party’s nonperformance of any contractual obligation. In addition to claim damages, the creditor has two additional options:
- Claim specific performance (nakoming)
- Partly dissolve the contract (ontbinding)
Upon dissolution of an agreement, the parties are no longer bound by the obligations arising from the agreement and each party must undo or repay any obligation arising from the agreement and must undo or repay any obligation that was already performed by the other party. In a situation both parties to a contract have obligations to each other, the nonperformance of one party may provide the other party with the right to suspend its own obligation under the contract.
In case of contractual obligations, Article 6:89 of the Code stipulates that if a creditor fails to timely complain about a shortcoming in the performance by a debtor, it loses all its rights in relation to the shortcoming. A creditor has to complain within an appropriate time after he or she has discovered a shortcoming in the performance, or after he or she reasonably should have discovered it. Taking that into account, it is debatable what constitutes “appropriate time” and this heavily depends on the specific circumstances of the case. For that reason, there is a substantial case law on this topic.
The sections of the Code that govern the period of limitation of action apply to both contractual and non-contractual liabilities. Hereunder, only the discharge by prescription is discussed and not the acquisition by prescription.
The prescription term for claims for contractual penalties and for damages is usually five years. The term starts running on the day following the day on which the injured party has become aware of both: (i) the damage or the fact that the contractual penalty has become due and payable and (ii) the identity of the liable party.
In any event, claims for contractual penalties and for damages will expire after 20 years from the day on which the event occurred that caused the damage or that triggered the contractual penalty to become due and payable.
The most applied basis for non-contractual liability is Article 6:162 of the Code. This article stipulates that any party committing a “wrongful act” (onrechtmatige daad) toward another party is liable for all damages incurred by the injured party, provided that the wrongful act is attributable to the party committing the wrongful act and that there is a causal connection between the damage and the wrongful act. There are three categories of a wrongful act and these are as follows:
- infringement of a subjective right;
- act or omission violating a statutory duty
- conduct contrary to the general standard of conduct acceptable in society.
Examples of wrongful acts for the respective categories are:
- Violation of a party’s rights to privacy by a physician who fails to keep medical records confidential;
- Building without a permit as required by law
- Creating a dangerous and possibly injury-causing situation without undertaking reasonable precautions or preventive measures.
In principle, liability under Article 6:162 of the Code is liability based on fault. However, under Dutch law, several types of non-contractual liability are based on strict liability (risicoaansprakelijkheid).
One of the main types of this kind of liability is the liability for defective products. Strict liability means a liability based on risk. The requirement of attributability and/ or the applicability of one of the categories of wrongful acts mentioned above are less relevant to establish liability.
The main components of a wrongful act based on strict liability are: (i) the existence of damage and (ii) the causal connection between such damage and the liable party’s actions deemed to be a wrongful act.
The Code provides that the following two types of damage may be compensated: (i) financial loss (vermogensschade) and (ii) other disadvantages (ander nadeel). The sections of the Code that govern compensation apply to both contractual and non-contractual liabilities. Dutch law does not distinguish between direct damages and consequential damages.
In principle, all damages suffered must be compensated, provided that there is sufficient connection between the damage and the event that has led to the liability of a party, which requires that the damage may reasonably be attributed to it as a consequence of that event, taking into account the nature of the liability and of the damage.
The parties are free to contractually exclude or limit their potential liability for damage incurred by another party, thereby deviating from the liability provisions in the Code. However, there are some restrictions and exceptions.
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