What are extrajudicial costs and what costs can you recover from a business partner?
These 2 questions are in fact addressed in every case where I assist a client who wants to recover a claim. In most cases we first look at whether a case can be solved out of court. In this process – before we go to court – the so-called extrajudicial costs are incurred for, among other things, writing to and consultation with the other party or his lawyer.
Jurisprudence out-of-court costs
In its judgment of 12 April 2019, the Supreme Court again addressed this issue and determined which extrajudicial costs are eligible for reimbursement and which are not.
In doing so, the Supreme Court first of all cited standard case law, which shows that drawing up and sending a reminder or another simple letter is not sufficient to claim compensation for extrajudicial costs.
Several extrajudicial activities carried out
In the aforementioned judgment of 12 April 2019, it was argued that a claim could be made for the recovery of extrajudicial costs because several actions had been taken, such as sending a letter of complaint, drawing up and sending an opt-out statement and a letter of bail. All in accordance with models, by the way.
Standardized and simple work
The Supreme Court ruled that the extrajudicial activities carried out involve no more than the drafting and sending of a few standardized documents. Such work should be placed on a par with the drafting and sending of a reminder or other simple letter as referred to in the aforementioned standard case law.
The Supreme Court has indicated that, pursuant to Section 6:96(3) of the Dutch Civil Code in conjunction with Section 241 of the Rv, these activities do not qualify for compensation in proceedings. They change colour (from extrajudicial costs to procedural costs, as it were) as soon as proceedings are commenced and are deemed to fall within the scope of the activities in preparation of proceedings. There is then no place for a separate reimbursement of extrajudicial costs.
Litigation costs only
The conducting of an intake interview, assessing the feasibility of the claimant’s claims and advising on this, as well as the collection of data to determine the extent of the claimant’s claims, do not qualify for compensation either. According to the Supreme Court, these are activities that must also be carried out in preparation of proceedings and therefore fall under Section 6:96(3) of the Dutch Civil Code and Section 241 of the Rv.
Compensation for extrajudicial expenses: when?
As a reminder, when is compensation for extrajudicial costs possible: When various substantive, i.e. more than 2 non-standard letters have been sent and/or there has been substantial consultation with the other party in order to reach an amicable settlement.
If you would like to know more about your possibilities of compensation for extrajudicial costs, please feel free to contact LVH advocaten.
