Legal Blog

Thursday, July 04, 2013

Breach of contract in the Dutch Caribbean (V)

Restrictions on termination

With regards to damages, the aim thereof is generally to restore the creditor to the position he would have been in had the contract been fulfilled. In case of breach of contract, the damages will usually be assessed by considering the situation the creditor would be in if restored to the position he would have been in had the contract been performed properly, by looking at costs incurred, wasted expenditure, any loss of profits etc.

The Civil Codes of the Dutch Caribbean (Aruba, Bonaire, Curacao, St. Maarten, St. Eustatius and Saba) will generally allow an injured party to claim damages based on the expectations/positive interest, i.e. the position that the claimant would have been in had the contract been performed. 

Damages may be occasionally be awarded on the basis of the reliance/negative interest, i.e. the position that the claimant would have been in had the contract never been made, for instance if the injured party is unable to prove any loss of profits as a result of the non–performance by the other party with sufficient certainty. Furthermore, damages that may generally be claimed are limited to any harm that can be established with a reasonable degree of certainty. The harm in question must also have been foreseeable at the time that the contract was entered into.

The Civil Codes in the Dutch Caribbean contain several restrictions on the right to terminate a contract in the case of non–performance. One may think of the rules (i) requiring the innocent party to grant the party in breach a last chance to perform and/or (ii) allowing the party in breach to cure its non–performance and/or (iii) limiting termination to cases of serious non–performance. 

There are several reasons for using such restrictions instead of giving the blameless party the right to terminate the contract immediately for any non–performance. These restrictions represent a policy to uphold the contract. This may be viewed as a way to maintain the original intention of the parties as much as possible.

Filed under: Commercial by Karel Frielink.

 

 


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