On 21 August 2024, a judgment of the Amsterdam Court of Appeal was published in a dispute concerning the amount of compensation for work carried out on a yacht (ECLI:NL:GHAMS:2024:1835).
Facts presented
A yacht owner requested a contractor to perform work on the yacht. The owner made some payments for that work. The owner subsequently agreed to make an additional payment of €50,000 and a commission of 2% when the yacht was sold. Subsequent correspondence took place about the amount of the additional payment and commission, but the parties were unable to reach agreement. Eventually, the owner sold the yacht for €150,000.
The contractor claims subsequent payment of over €166,000 for work done and €3,000 commission as a result of the sale of the yacht. The owner claims rescission or annulment of all arrangements made and damages for unsound work on the yacht.
The court grants the contractor’s claim for additional payment up to the owner’s previously acknowledged amount of €50,000 plus a commission of €3,000. The owner’s claim for damages is dismissed as insufficiently substantiated that the contractor failed to comply with the arrangements made.
Court considerations
The court considered that the contractor had not sufficiently explained why the owner would have agreed to pay a higher amount than €50,000. From the correspondence between the parties, no agreements to the contrary could be deduced.
The court also considered that the owner – because he expressed his satisfaction with the work done by the contractor several times and also in the light of the findings of the expert hired by the contractor – had not sufficiently argued that the contractor had failed in his obligation to renovate the boat to such an extent that rescission of the arrangements made would be justified. The fact that the contractor’s expert valued the yacht much higher than the amount for which the yacht was sold some time later does not make the content of the expert’s report unsound, since the offering of an amount is determined not only by the value of the yacht but also by other factors. Nor does the circumstance that the contractor removed essential items from the yacht lead to a different judgment. It was sufficiently clear that by removing those items – by way of retention, according to the contractor’s own words – the contractor wanted to prevent the yacht from being sailed, and that the items removed could be put back in place relatively easily, the court said.
The court therefore partly upheld the contractor’s claim and dismissed the owner’s claim, following the court’s lead.
Lessons learned
This case shows that it is important to make clear payment arrangements in advance and to put any changes in writing afterwards. In doing so, it is advisable to, when settling on a cost basis, for example, stipulate that invoices for costs incurred be submitted. In the case of fees linked to the sale of a yacht, it is also important to lay down the conditions for payment of the fee. For example, a contract for the sale may subsequently be annulled or rescinded. However, this does not mean that this makes the fee no longer payable.
We have extensive experience in drafting building contracts and commission agreements and litigating such contracts on behalf of yards and buyers. If you have questions about the content of such contracts or need an analysis of your dispute, please feel free to contact us.
