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Amsterdam Court of Appeal underscores importance of definitions in agreements

Concepts in an agreement must be clearly defined, otherwise disputes quickly arise. After all, a judge does not interpret a contract purely linguistically, but according to the Haviltex standard: what the parties could reasonably expect from each other...

Published on March 4, 2021 by MKBjuristen.nl
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Concepts in an agreement must be clearly defined; otherwise, disputes quickly arise. After all, a judge does not interpret a contract purely linguistically, but according to the Haviltex standard: what could the parties reasonably expect from each other? A clear list of definitions — and, for important contracts, a preamble — prevents costly conflicts.

A ruling by the Amsterdam Court of Appeal demonstrates once again how important it is to clearly explain the terms used. They are often the cause of discussion, and there should be no room for ambiguity. We therefore always recommend a list of definitions, and sometimes also a preamble.

The case: discussion about “available to the public”

An author of a Dutch-language children's book had a publishing agreement with Overamstel Uitgevers. After three printings, the publisher did not want to reprint, but offered the book via printing on demand: the book is only printed after an order is placed and is therefore not available in stores by default.

The author disagreed with this. The agreement stipulated that the publisher had to guarantee that the work would not be “unavailable to the public in book form for longer than one year”, and that the author was entitled to terminate the agreement if the publisher failed to comply. When the publisher continued to refuse to reprint, the author terminated the agreement, and the case ended up before the Amsterdam Court of Appeal (ECLI:NL:GHAMS:2020:3481).

Explanation according to Haviltex, not only linguistic

The core question was whether printing on demand is equivalent to keeping the work “available to the public”. When interpreting an agreement, not only the linguistic meaning counts, but also what the parties could reasonably expect of each other in the given circumstances — the so-called Haviltex standard.

The publisher pointed to a definition in the agreement: “available to the public means that the work must be available in book form at the request of a consumer within at least one month, either from stock or by order.” The author argued that a purely linguistic reading would render the termination option meaningless, because the publisher could keep any book “available” via printing on demand.

The judge rules in favor of the publisher

The Court found the included definition sufficiently clear. Printing on demand does not render the ground for termination meaningless, as the author can still terminate the contract if the publisher does not offer a printing-on-demand service. Furthermore, the publisher had fulfilled its duty of care: via printing on demand, the book was made available in a timely manner, in sufficient quantity, and in good quality, provided it was deliverable within one month of the order. The publisher prevailed, and the author was ordered to bear the legal costs.

The lesson: define sharply, and consider a preamble

Although a purely linguistic explanation is insufficient, this case proves that clear definitions are crucial — even a single term can lead to dispute. The publisher could have done even better by explicitly including examples and stating 'printing on demand' in so many words. Since definitions are not always decisive under the Haviltex interpretation, it is advisable for important agreements to also include a preamble demonstrating the parties' intentions.

Frequently Asked Questions

What is the Haviltex standard?

The rule that an agreement is interpreted not only according to the literal text, but also according to what the parties could reasonably expect of each other in the given circumstances.

Do I need a definition list in my contract?

This is the case with contracts containing important concepts or terms open to multiple interpretations. A clear definition — preferably with examples — prevents disputes about what the parties intended.

What does a preamble add?

A preamble sets out the background and intention of the parties. This assists with the Haviltex interpretation when the text itself does not provide sufficient clarity.

Have a watertight agreement drawn up

Unclear terminology can cost you the case in a conflict. The legal experts at MKB Juristen draft agreements with precise definitions and a watertight preamble. View our expertise in contract law or schedule a free intake consultation .

Please note: an article provides general information, but your legal situation may turn out differently.

A contract, conflict, or legal risk must always be assessed based on the facts, documents, evidentiary position, and interests. Are you in doubt? Have your situation assessed before you act.

Legal question regarding this article?

A blog provides explanation, but your situation often requires a concrete legal choice. MKB Juristen helps entrepreneurs with contracts, terms and conditions, GDPR documents, employment documents, disputes, and customized legal solutions.

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