THE BINDING EFFECT OF JUDGMENTS

Limited to the parties involved in the proceedings

Court decisions, even decisions by the Dutch Supreme Court, are not binding on courts when deciding future cases. However, the Code of Civil Procedure prevents parties from litigating twice on the same legal issue. The principle that a final judgment of a competent court is conclusive upon the parties in any subsequent litigation involving the same cause of action is known as ‘res judicata ’.

A Dutch court case is described below illustrating this principle: Utrecht District Court of 19 March 2009 (NJF 2009/291).

In initial litigation, the claimant had sought payment of certain contractual penalties. The Court of Appeals rejected the claim on two separate grounds, the first being that under its interpretation of the agreement the claimant was not entitled to penalties for this particular shortcoming and secondly that the claimant had never issued a notice of default, thus the defendant had never been in default. The second argument was introduced with the word ‘moreover’ (in Dutch: bovendien).

The claimant then brought a new claim for different penalties, one which was not covered by the finding of the Court of Appeals in respect of the interpretation of the agreement, but by the finding that the defendant had never been in default.

The claimant argued that the second argument that the Court had used to reject the claim in the first litigation was not necessary, considering the first argument, and should therefore qualify as an obiter dictum, i.e. a finding that does not ‘carry’ the decision, and should therefore have no binding effect. The Utrecht District Court made short work of that argument: neither the use of the word ‘moreover’ nor the fact that there was another, preceding argument, for rejecting the claim, was any reason to qualify the second argument as an obiter dictum without binding effect. The claim in the second litigation was therefore rejected without any discussion on the merits of the case.

The binding effect of a judgment is limited to the parties which have been involved in the proceedings that resulted in the judgment. As far as the subjective scope of the binding effect (res judicata) is concerned: the subjective scope of a judgment is in principle limited to the parties involved in the proceedings which resulted in that judgment and their successors.

In a foreign case the subjective scope of judgments rendered in for instance Curaçao will be determined in accordance with the law of that particular jurisdiction, not by Curaçao law.

Under the laws of the Dutch Caribbean, a decision regarding (for instance) the contents of the law does have binding effect, subject to the limitation that it should concern the same case, i.e.: if in proceedings between two parties the Court would decide on a particular interpretation of a statutory provision, such a decision would not be binding in subsequent proceedings concerning a different matter, but would be binding in subsequent proceedings (in the Kingdom of the Netherlands) concerning the same case.

Under Dutch Caribbean law, findings by the Court which do not contribute to the resolution by the Court cannot have binding effect.

It is a standard rule in Dutch Caribbean civil proceedings that if one party takes a certain position in respect of the facts and the other party fails to contest that position, that the court will accept the first party’s position. In other words, if one party states a fact and it is not contested by the other party, such fact would be deemed true. The statement by the Court that a party failed to contest a certain position, is equivalent to that position being established by the Court. A conclusion reached after extensive debate has, for instance, just as much binding effect (res judicata) as one reached because the other party failed to contest the underlying facts. Even a default judgment has binding effect. Judgments in proceedings on the merits which are no longer subject to an ordinary legal remedy acquire res judicata under the Dutch Caribbean Codes of Civil Procedure, i.e. they have binding effect in subsequent proceedings between the same parties regarding the same legal matter.

Karel Frielink
(Attorney/Lawyer, Partner)

(2 March 2016)

.

Leave a Reply

You must be logged in to post a comment.