On 2 December 2024, a judgment of the Gelderland District Court was published in a dispute concerning the conformity of engines of a yacht sold by a broker (ECLI:NL:RBGEL:2024:7916).
Facts presented
A consumer bought a second-hand yacht through a broker. No written contract was drawn up of this purchase. The yacht was inspected before the purchase and the condition of it was classified as satisfactory to moderate by a surveyor. While rectifying defects found by the expert on the yacht, the buyer finds out that the two engines have a total of only 260 hp. However, based on the sales advertisement and communications from the broker, the buyer assumed that the yacht would have engines totalling 540 hp.
The buyer claims damages for non-conformity. The broker initially argued that he had only acted as an intermediary and that the buyer should sue the seller. However, during the oral hearing, the broker stated that he took delivery of the yacht from the seller and then sold and delivered it to the buyer.
Court considerations
The court considers that the buyer was led to expect that the yacht would have two engines capable of delivering a total of 540 hp. The sales advertisement and invoice stated that the yacht had ‘2x Max Power 270 hp’. The court held that the sales advertisement could not be read in any other way than that the yacht was equipped with two engines each capable of 270 hp, and does not follow the broker’s argument that the text stated that the total was 270 hp. The court also factored into its judgment that before the purchase, the broker had reviewed the inspection report, which stated the engine power to be 2 x 270 hp.
Because the yacht has two engines, each with 130 hp, the yacht has a total engine power of only 260 hp. The yacht therefore does not have the characteristics that the buyer was entitled to expect under the agreement. Consequently, in the opinion of the court, there is non-conformity with regard to the power in the engines of the yacht.
Regarding the claimed damages, the court considers that the costs incurred for revising the engines were not eligible for compensation because they were separate from the non-conformity found. Indeed, the buyer knew that the condition of the engines was moderate. The buyer’s claim for price reduction is, however, partly upheld. This is because the buyer first gave the broker the opportunity to fulfil the agreement and ensure that the yacht was provided with conforming engines. The amount is set by the court at half the estimated value of the engines in the condition they were in at the time the sale was concluded.
Lessons learned
This case demonstrates the importance of clear language in the sales contract and related documentation. In case of a dispute over the wording of such documents, the court or arbitrator will have to interpret the text. In this case, that will prove costly to the broker. Although the text of a sales advertisement is not necessarily binding on the parties, it does give context to what a buyer – especially a consumer – could reasonably expect from the yacht. The relevance of the advertisement in this case was possibly even greater in the absence of a written sales contract.
We have extensive experience in drafting contracts for the sale of yachts, and litigating such contracts on behalf of buyers and sellers. If you have any questions about the content of such contracts, please feel free to contact us.
