Actual legal costs incurred qualify for compensation exclusively in cases of abuse of procedural rights or unlawful litigation under Dutch law. The losing party then compensates all actual attorney fees instead of the standard court tariff, which often represents merely a fraction of the real costs.
The Dutch legal cost system protects litigants against excessive financial risks. According to Articles 237-240 of the Dutch Code of Civil Procedure (Rv), the liquidation tariff determines how much a losing party must pay in legal costs. This flat-rate system calculates compensation based on the number of procedural actions and the financial interest of the case. In 75% of procedures, however, this standard compensation covers only a small portion of the actual attorney fees.
How Does the Liquidation Tariff Work in Dutch Law?
The liquidation tariff employs a point system where each procedural action generates a fixed number of points, with the court determining the total amount based on financial interest and work performed.
The court calculates compensation using standardized rates for specific procedural steps. For instance, a claim of €25,000 with standard procedural actions results in approximately €1,500 in legal cost compensation, while actual attorney fees often range from €8,000 to €15,000. This substantial gap reflects the Dutch policy choice to maintain accessible litigation for all parties regardless of financial capacity.
Moreover, courts almost always fully compensate court registry fees (starting from €127 for straightforward cases) and bailiff costs according to the Decree on Tariffs for Official Acts of Bailiffs. These costs, however, constitute only a minor component of total legal expenses. The limited compensation for attorney fees ensures that litigation remains affordable and prevents wealthy parties from using cost threats to discourage legitimate claims.
What Constitutes Abuse of Procedural Rights Under Dutch Law?
Abuse of procedural rights occurs when a party initiates or continues an evidently hopeless procedure, knowing the claim or defense has absolutely no chance of success under applicable legal standards.
Within 50 words: The Dutch Supreme Court established in ECLI:NL:HR:2017:2366 a stringent standard: abuse exists only when filing the claim, given its evident lack of merit and the interests involved, should have been avoided entirely.
Specific examples of procedural abuse recognized by Dutch courts:
- Basing arguments on deliberately false facts – The claimant knows the incorrectness of assertions or should have known
- Maintaining hopeless positions – Continuing procedures when the claiming party knows no legal basis exists
- Violating the duty of truthfulness under Article 21 Rv – Deliberately withholding crucial information or persistently stating facts known to be incorrect
- Fraudulent proceedings – Intentionally misleading the court with false documents or statements
Dutch case law demonstrates considerable restraint in accepting abuse of procedural rights. This restraint protects the right to access justice as guaranteed by Article 6 of the European Convention on Human Rights. Nobody should be prevented from presenting their position to a judge out of fear for astronomical legal cost claims.
How Does Violation of the Duty of Truthfulness Function in the Netherlands?
Violation of the duty of truthfulness forms a strong indicator for unlawful litigation, as Article 21 Rv requires parties to provide complete and truthful information to the court.
According to Dutch procedural law, Article 21 Rv obligates litigants to present facts completely and accurately. When a party consistently maintains positions contrary to facts they know or should know, courts may qualify this as unlawful conduct justifying full compensation of actual legal costs.
A concrete example: A buyer claimed damages because the property brochure stated larger square footage than actually existed. During proceedings, it emerged that the buyer had commissioned a valuation report before purchase clearly showing the brochure’s inaccuracy. Nevertheless, she stated in the summons that she knew nothing about the inaccuracy. The Rotterdam District Court condemned her in ECLI:NL:RBROT:2023:846 to pay €8,000 in actual attorney costs for acting contrary to the duty of truthfulness.
Contact our law firm in Amsterdam for advice about your position if you face an evidently unfounded claim. Our lawyers analyze whether abuse of procedural rights exists and advise on claiming actual legal costs.
When Can Fraudulent Insurance Claims Lead to Full Legal Cost Compensation Under Dutch Law?
Fraudulent insurance claims regularly result in full legal cost awards when insureds deliberately make false claims and subsequently persist in incorrect factual assertions during litigation.
Within 50 words: Dutch case law consistently shows that such conduct constitutes abuse of procedural rights. The Court of Appeal of Den Bosch ruled in a case concerning alleged theft that a fraudulent damage report followed by persisting in incorrect positions constitutes unlawful litigation.
The insurer received full legal costs because the insured knew his claim lacked foundation. Similarly, the Maastricht District Court ruled in JbPr 2007, 54 regarding an insured who claimed insurance benefits based on a false theft report. In insurance cases, three elements typically play a role in accepting abuse of procedural rights: deliberately misleading the insurer, submitting false documents or statements, and persisting in incorrect positions during proceedings. Consequently, insurers can more successfully recover actual legal costs than parties in other disputes.
How Are Actual Legal Costs Calculated in the Netherlands?
Actual legal costs comprise all hours billed by an attorney multiplied by the applicable hourly rate, typically ranging from €250 to €450 per hour for lawyers in Amsterdam depending on specialization and experience.
Within 50 words: In complex cases with extensive files, witness hearings and multiple court sessions, actual costs quickly accumulate to €15,000 or €25,000, far exceeding the standard liquidation tariff compensation.
Concrete cost calculation in a practical example:
An entrepreneur from Amsterdam summoned his former business partner for €50,000. After three hearings, extensive written debate and witness testimonies, the claim proved entirely unfounded. The defendant’s attorney had spent 62 hours at €325 per hour, resulting in €20,150 in actual costs. The standard legal cost award according to the liquidation tariff amounted to merely €2,268. By proving abuse of procedural rights, the defendant ultimately received the full €20,150 plus €520 in court registry fees.
Dutch courts assess the reasonableness of claimed actual legal costs according to Article 6:96 paragraph 2 of the Dutch Civil Code (BW). Both incurring the costs and their extent must be reasonable. Excessive billing does not qualify for compensation. Courts may moderate the claimed amount if costs appear disproportionate to the case’s complexity and importance.
Which Special Circumstances Justify Compensation for Actual Legal Costs in Dutch Law?
Besides abuse of procedural rights, specific legal areas in the Netherlands recognize different regimes, particularly intellectual property disputes where losing parties standardly compensate full actual legal costs.
Within 50 words: This exception protects the often vulnerable position of rights holders who otherwise risk that enforcement of their rights becomes financially unfeasible, as established in Dutch intellectual property legislation.
Additionally, unlawful litigation without technical abuse of procedural rights can still lead to full legal cost awards. For example, when a non-party becomes involved in a dispute and through unlawful conduct causes or prolongs the procedure. For these third parties, regular liability rules according to Article 6:162 BW combined with Article 6:96 paragraph 2 BW apply for damages in the form of legal costs.
The Amsterdam District Court applied these rules in ECLI:NL:RBAMS:2022:3113 where a director was personally sued for $464 million. Although proceedings targeted four defendants, the court condemned only the claimant to pay actual legal costs of one defendant (£280,000). For this director, the case was evidently hopeless, time-consuming, mentally burdensome and extremely expensive as a private person.
Can a Defendant Party Also Receive Actual Legal Costs Under Dutch Law?
Absolutely. The Dutch Supreme Court confirmed in ECLI:NL:HR:2017:2360 explicitly that defendants can also claim compensation for actual legal costs when the claiming party abuses procedural rights.
Within 50 words: Similarly, a defendant who presents unlawful defense can be condemned to pay the claimant’s full legal costs. This principle ensures equal protection for all parties against frivolous litigation.
A defendant confronting a hopeless claim can indicate during proceedings that they will claim full legal costs after dismissal. This announcement forms a strong incentive for the claiming party to reconsider the procedure. In practice, defendants prove even more successful in obtaining full legal cost compensation than claimants, because hopeless claims are easier to identify than unjustified defenses.
Want certainty about your possibilities for recovering legal costs? Our specialized lawyers in Amsterdam assess your case and advise on the strategy for obtaining full legal cost compensation.
How Do You Prove Abuse of Procedural Rights in the Netherlands?
Demonstrating abuse of procedural rights requires careful documentation throughout the entire procedure, with crucial evidence including correspondence before proceedings warning about the claim’s hopelessness.
Within 50 words: Inconsistencies between earlier positions and procedural standpoints form strong proof. Dutch courts particularly value concrete evidence over speculative arguments about the opponent’s intentions.
In ECLI:NL:RBAMS:2020:4228, the Amsterdam District Court condemned a collection agency to pay €3,192.65 in actual legal costs. The agency had repeatedly misinformed and misled its client about legal viability. The court considered that claims were evidently hopeless, the agency charged incorrect amounts, and needlessly caused costs. The defendant had preserved all correspondence wherein he pointed out errors to the collection agency.
Practical evidence for abuse of procedural rights:
- Written warnings before proceedings about the claim’s hopelessness
- Documents proving the claiming party knew the incorrectness of assertions
- Witness statements refuting the claiming party’s allegations
- Earlier case law showing identical claims were dismissed
- Administration demonstrating the claiming party deliberately provided incorrect information
Dutch judges especially appreciate concrete proof over speculative arguments about the opponent’s intentions.
What Time Limit Applies for Claiming Actual Legal Costs in Dutch Law?
The claim for compensation of actual legal costs arises only after conclusion of the procedure in which abuse of procedural rights occurred, subject to the regular five-year limitation period under Article 3:306 BW.
Within 50 words: During ongoing proceedings, courts cannot award actual legal costs, at most the standard legal cost award according to the liquidation tariff. After conclusion, the injured party must initiate separate proceedings for claiming actual damages.
The limitation period starts when the injured party becomes aware of both the damage and the liable person. In practice, this means from the moment of the final judgment in which the court dismisses the hopeless claim or rejects the unfounded defense.
However, the injured party can already indicate during ongoing proceedings that they will claim actual legal costs after conclusion due to abuse of procedural rights. This announcement functions as a warning and gives the opponent the opportunity to reconsider the procedure. Some Dutch courts value this early warning positively when assessing the ultimate claim.
What Are the Risks of Claiming Actual Legal Costs in the Netherlands?
Claiming actual legal costs brings procedural risks, as the injured party must initiate new proceedings with associated court registry fees and attorney costs.
Within 50 words: If the court rules that no abuse of procedural rights occurred, dismissal of the claim follows with a legal cost award according to the regular liquidation tariff.
Moreover, Dutch courts apply very stringent tests for whether abuse of procedural rights truly exists. The restraint in accepting it means only a limited percentage of these claims succeed. In approximately 35% of cases where full legal costs are claimed, courts dismiss claims wholly or partially because insufficient proof exists that the opponent consciously initiated a hopeless procedure.
Another risk involves the condemned party’s unwillingness or inability to pay. A legal cost award of €20,000 helps little if the debtor offers insufficient recovery prospects. Bailiff costs for execution come on top. Therefore, investigating recovery possibilities before initiating proceedings about actual legal costs is advisable.
How Do Actual Legal Costs Relate to Extrajudicial Costs in Dutch Law?
Extrajudicial costs and legal costs form two separate items under Dutch law, with extrajudicial costs covering all expenses before approaching the court, including attorney fees for correspondence, collection costs and legal advice expenses.
Within 50 words: The injured party can often claim these costs based on Article 6:96 paragraph 2 BW. The liquidation tariff concerns exclusively legal costs, not extrajudicial costs.
For extrajudicial collection costs, a separate regime applies pursuant to the Decree on Compensation for Extrajudicial Collection Costs. This decree determines flat-rate amounts depending on the principal sum, varying from €40 for claims up to €200 to maximum €6,775 for claims exceeding €600,000.
When a party claims actual legal costs due to abuse of procedural rights, they can often simultaneously claim actual extrajudicial costs. This cumulation strengthens the injured party’s position. In ECLI:NL:RBROT:2023:846, the court awarded €8,000 in actual legal costs plus €1,250 in extrajudicial costs because the claiming party had needlessly confronted the defendant with her hopeless claim.
What Role Does Mediation Play in Disputes About Legal Costs According to Dutch Law?
Mediation offers an alternative for proceedings about actual legal costs, with parties able to agree that when the main dispute ends, the legal costs issue is also discussed in mediation.
Within 50 words: This prevents a second, expensive procedure and promotes rapid resolution. Increasingly, Dutch courts suggest resolving disputes about actual legal costs via mediation.
Courts can even refer parties to mediation before deciding substantively on the claim. Mediation agreements about legal costs often provide for compromises whereby the original claimant pays more than the liquidation tariff but less than full actual costs.
Successfully settled example: An employer was condemned in an employment law procedure after an evidently hopeless termination. The employee claimed €15,000 in actual legal costs. During mediation, the employer agreed to pay €8,500, whereby both parties avoided lengthy follow-up proceedings and obtained certainty about the financial result.
Can Actual Legal Costs Be Moderated in the Netherlands?
Dutch courts possess authority to moderate claimed actual legal costs if excessive, as Article 6:96 paragraph 2 BW requires both incurring costs and their extent to be reasonable.
Within 50 words: An attorney billing €600 per hour while an hourly rate of €300 is customary for comparable cases risks moderation by the court.
The Utrecht District Court applied moderation in LJN:BP0052 by awarding only part of actual legal costs. The court considered that although abuse of procedural rights existed, the injured party’s attorney had billed excessively many hours for relatively simple actions. The awarded amount ultimately represented 60% of claimed actual costs.
Factors Dutch courts consider in moderation:
- Comparison with customary hourly rates for comparable lawyers
- Necessity of the number of billed hours
- Case complexity in relation to time spent
- Overlap or duplicate work in billings
- Proportionality relative to the case’s importance
Lawyers claiming actual legal costs act wisely by carefully substantiating their billings and only charging reasonable costs to avoid judicial moderation by Dutch courts.
What Are the Consequences for Collection Agencies and Bailiffs in the Netherlands?
Collection agencies face elevated risk of condemnation to actual legal costs because they are professional collectors expected to assess claims’ legal viability before initiating proceedings.
Within 50 words: The Amsterdam District Court ruled particularly strictly in ECLI:NL:RBAMS:2020:4228 about a collection agency that misinformed its client and initiated a hopeless procedure, resulting in full liability for the defendant’s actual attorney fees.
Bailiffs can equally be liable for actual legal costs if they knowingly cooperate with unlawful executions or procedures. Their professional standard requires testing claims’ legitimacy before taking enforcement measures. A bailiff who attaches property while evidently the underlying claim cannot withstand scrutiny risks liability for all damage thereby caused.
In practice, this means collection agencies and bailiffs must operate with extra care. They must thoroughly investigate claims, correctly inform clients about legal viability, and terminate procedures once no legal basis exists. Continuing procedures out of commercial interest can lead to substantial damage claims under Dutch liability law.
Contact our law firm in Amsterdam for personal legal advice about your specific situation. We analyze whether you can claim compensation for actual legal costs and guide you in recovering them.
