The Civil Division

Civil Section breakdown

Notable in 2024 was the number of arbitration cases (12) and other forms of alternative dispute resolution. Among other things, these addressed the meaning of an obligation agreed between the parties to first try mediation in the event of a dispute (ECLI:NL:HR:2024:1078). Mediation is means of resolving a dispute involving a neutral mediation expert, the mediator, who guides negotiations between the parties to achieve an outcome they support and which observes their interests.  The Supreme Court held that the meaning of a mediation clause must be determined by interpreting it based on the intentions of the parties. That interpretation may entail that the clause requires the parties to attempt mediation before initiating court or arbitral proceedings. A significant factor in this regard could be that the clause was agreed between professional parties and relates to a business dispute.  However, a mediation clause must not be applied if it unacceptably restricts the right of access to justice. The question of when a party may subsequently terminate the mediation process also depends on the interpretation of the mediation clause. If a mediation clause requires mediation to be attempted first and the parties have not done so, the court may stay the case until they have done, but it may also refrain from doing so, for example because the case is urgent or because it is pointless to try mediation under the given circumstances.

In 2024, the Supreme Court also handled many cases on the effect of European law in the Dutch legal system. Cases regarding the occurrence of a payment obligation after using an online "order” button (ECLI:NL:HR:2024:1355 and (ECLI:NL:HR:2024:1366) and the rent adjustment clause (ECLI:NL:HR:2024:1780) drew a lot of attention. Each of them led to judgments answering questions referred for a preliminary ruling, as part of the Supreme Court's task of developing the law and ensuring the uniformity of law.

The online "order” button cases addressed the question of whether an order button with the text "place order" meets the legal requirement that it is clear to the consumer that clicking on the button leads to a payment obligation. According to the Supreme Court, given the text and explanation of the relevant provision in the Consumer Rights Directive and its equivalent in our Civil Code, it does not. The average consumer does not necessarily and consistently associate the term "placing an order" with the creation of a payment obligation. If a consumer entered into a transaction using an order button that did not meet the legal requirements, the court must annul that contract wholly or in part. The seller may then be entitled to compensation.

In the case regarding the rent adjustment clause (ECLI:NL:HR:2024:1780), the Supreme Court answered questions about a provision stipulating an annual mark-up of up to 3% used in the liberalised rental sector ("mark-up clause") in addition to an indexation clause based on the consumer price index. It held that, in principle, such a provision is not unfair, because the landlord has a legitimate interest in being able to adjust the rent annually, and not only for inflation. It also answered questions about the consequences of a rent adjustment clause that is indeed unfair.

The cases in which cassation in the interest of the law was sought are also relevant to the Supreme Court’s task of developing law. A claim for cassation in the interest of the law relates to a decision that has become final, and is instituted by the Procurator General with the Supreme Court. The outcome of a claim for cassation in the interest of the law does not change the decision which the claim takes issue with and, therefore, it does not change the legal position of the parties to the case. However, it is of interest to the law. In 2024, questions on insolvency law were submitted to the Supreme Court with a claim for cassation in the interest of the law (ECLI:NL:HR:2024:1533). What was noteworthy in that case was that the Procurator General provided an opportunity for interested parties to submit comments relevant to answering the questions of law (ECLI:NL:PHR:2024:346). The case turned on whether a financier may be required to make unused credit available to a debtor under conditions unfavourable to them through a compulsory composition outside bankruptcy, and whether such a composition could alter the order of priority of creditors.

The Supreme Court is also the highest court in Caribbean cases. This means that an appeal in cassation against decisions of the Joint Court of Justice of Aruba, Curaçao, Sint Maarten and of Bonaire, Sint Eustatius and Saba can be submitted to the Supreme Court. Generally, the law to be applied corresponds to the law in the European part of the Kingdom. However, that is not always the case. Also, the procedural law is not identical in every respect. In addition, when interpreting and applying rules of law, the Supreme Court must take into account the possibility that societal views in the Caribbean part of the Kingdom may differ from those in the Netherlands. In 2024, the Civil Division ruled, inter alia, on the exclusion of same-sex marriage in Aruba and Curaçao (ECLI:NL:HR:2024:977 and 978). In Aruba and Curaçao, legislation in a formal sense (legislation established by the government and parliament) may be reviewed against the traditional fundamental rights (constitutional review) on the basis of the State rules in force in those countries (which have the same status as the Constitution). In these cases, the Joint Court of Justice ruled that the exclusion of same-sex marriage violated the principle of equality enshrined in the State Rules and constituted discrimination on the basis of sexual orientation. The Countries of Aruba and Curaçao did not dispute this in cassation, but raised the issue of whether the courts themselves are allowed to correct the deficiency in the law in such a case, or whether they should leave that to the legislature. The Supreme Court ruled that courts must exercise restraint when intervening in legislation in the formal sense, given the primacy of the legislature in that regard. However, according to the Supreme Court, the Joint Court of Justice was competent to decide in that case to allow marriage between partners of the same sex. In this regard, the Supreme Court also took into account the fact that the Joint Court of Justice had found that the discrimination in question had gone on for a long time (the Countries did not dispute that) and that it was clear how the discrimination had to be eliminated.