Signing a contract under Dutch law: what to check first

A contract under Dutch law is formed by offer and acceptance (Article 6:217 of the Dutch Civil Code, BW), with no particular form required: an agreement reached by email, or even orally, binds you. What matters is not the signature, but whether the other party could reasonably infer your assent from your words or conduct, so the moment to be careful comes well before the signature block.

Is the person you are dealing with authorised to sign?

Check this first. The Dutch commercial register (KVK) shows who may represent the company and whether that authority is limited to a certain amount or requires a second signature.

If the signatory lacks authority, the company is in principle not bound. The exception is apparent authority (Article 3:61(2) BW): the company created the appearance that authority existed and you reasonably relied on it. That is a fact-specific argument you would rather not have to run.

Whose general terms and conditions apply?

If both parties refer to their own conditions, the set referred to first applies, unless the second party expressly rejects it (the “battle of forms”, Article 6:225(3) BW). A line in an email footer stating that your conditions apply is not an express rejection, so settle this point in the contract itself.

Check what the applicable conditions say about liability, delivery periods and termination. Conditions that were not made available before or at the conclusion of the contract can be annulled (Articles 6:233 and 6:234 BW).

Which clauses tend to decide a dispute?

Five clauses come up again and again in Dutch contract disputes before the district court:

• the description of what is to be delivered, specific enough that an outsider could tell whether it was done;
• the price, and whether it can be adjusted;
• duration and termination, including automatic renewal and notice periods;
• the limitation of liability, including consequential loss and whether the cap is realistic;
• the dispute clause, naming the competent court or arbitral tribunal and the governing law.

A penalty clause turns a loss that is hard to prove into a fixed sum, often the only practical remedy for a breach of confidentiality or a non-compete. A Dutch court can reduce a penalty that is manifestly excessive (Article 6:94 BW), so a proportionate figure serves you better than a punitive one.

What if something was agreed but never written down?

Dutch contracts are interpreted by what the parties could reasonably expect of one another, not only by the wording; reasonableness and fairness (redelijkheid en billijkheid, Article 6:248 BW) can supplement or limit what was agreed. Pre-contractual statements, brochures and emails therefore matter: keep them, and be careful what you promise in them.

What should you check as a buyer or client?

As the party receiving the goods or services, your risk lies mostly in vague obligations and a low liability cap.

• Is the deliverable described precisely enough to test whether it was delivered?
• Does the liability cap stand in proportion to the damage you could suffer?
• Can you terminate in time, or does the contract renew automatically?
• Are all annexes attached, and is the counterparty named with its KVK number?

What should you check as a supplier?

As the supplying party, your risk lies mostly in open-ended liability and fixed prices over a long term.

• Do your own general terms apply, and did you make them available on time?
• Is your liability capped and consequential loss excluded?
• Can you adjust the price, for example through annual indexation?
• Is the signatory on the client side authorised under the KVK register?

What can we do for you with a contract?

We review and negotiate contracts as part of our corporate lawyer services.

• We review the draft contract and the applicable general terms before you sign.
• We check the signatory’s authority in the KVK register.
• We redraft the liability, termination and penalty clauses.
• We draft the dispute and governing-law clause for cross-border contracts.

Summary

• A contract can bind you before it is signed, so check authority, terms and key clauses in good time.
• Settle whose general terms apply in the contract itself, and check they were actually provided.
• Give the description, price, duration, liability and dispute clause specific attention: these decide most disputes.
• Before signing, check the version, the annexes and the named parties, and keep a signed copy.