Betterment deduction: when may a seller refuse to pay?

When the repair bill can be reduced

A deduction for betterment, known in Dutch practice as aftrek nieuw voor oud, means that a seller or contractor need not pay part of the repair bill because something new replaces something old. Two conditions apply: the injured party must in fact derive a benefit, and it must be reasonable to bring that benefit into account. It is commonly calculated by dividing the age of the item replaced by its useful life.

A caution on the Dutch name. Nieuw voor oud translates literally as "new for old", but in English insurance practice a new-for-old policy pays the replacement cost precisely without a deduction for betterment. The Dutch phrase therefore means close to the opposite of the English term of the same words.

Four questions determine the outcome of a dispute of this kind, and they are addressed below in turn:

Is there an actual benefit?
Does the contract provide for a deduction for betterment?
Which head of loss does the benefit attach to?
How is that benefit evidenced and quantified?

Why one case produced three different deductions

On 4 January 2023 the Rotterdam District Court awarded the buyers of a farmhouse €25,592.70 in total, split across three heads of loss with three deductions: 0%, 50% and 17.5% (para. 2.25). One case, three outcomes; the explanation is the key to the whole subject.

During earlier building work a load-bearing roof beam had been sawn through to make room for a rooflight (para. 2.4). By the time the buyers discovered it, the house was at risk of collapse; the walls had to be shored up and a new concrete foundation poured.

For the roof structure itself the court made no deduction: it is "an essential part of the house, which must be present and in sound condition", so repairing the missing parts confers no benefit (para. 2.12).

The foundation was treated differently: that head of loss was halved, from €25,303.33 to €12,651.66. The foundation was, admittedly, needed to prevent collapse, "but the house ended up with a far better foundation than the house the claimants originally bought" (para. 2.17). The court also took into account that before the purchase the buyers had already been alerted to a potential cost for cracks and the foundation, which "must be regarded as having been at least partly reflected in the purchase price" (para. 2.18).

The floor insulation was the only head on which the court actually did the arithmetic. The seller had disclosed only that insulation was present, not when it had been installed (para. 2.22). The court took as its reference point the seller's own belief that the insulation dated from 2012, which would have made it 7 years old at the date of the purchase. Against a 40-year useful life that gives 17.5%, and the deduction applied to the demolition and groundworks as well, because those costs "would have had to be incurred in any event in order to replace the floor insulation" (para. 2.23).

Useful life, maintenance and value determine the benefit

The Supreme Court answered the central question on 23 June 2023, in a case about a damaged water main. May part of reasonable repair costs be deducted as a benefit under Section 6:100 of the Dutch Civil Code (DCC)? The Supreme Court held that it may. The argument that nothing can be brought into account where loss has been assessed on an objective basis rests on "an incorrect view of the law" (para. 3.3.1) and cannot stand. The Supreme Court does not itself use the expression nieuw voor oud; the term originates in the opinion of Advocate General Lindenbergh, who describes the doctrine as "expenditure forced upon the injured party" (para. 4.17).

That is balanced by a limit which protects the injured party. In assessing what is reasonable, "regard must be had, among other things, to the need to avoid forcing a particular pattern of expenditure on the injured party against his will" (para. 3.2). In that case the deduction of 30% could not stand, because the court of appeal had given insufficient reasons for it (para. 3.3.2).

The Amsterdam Court of Appeal applied that test in the context of a house purchase on 9 January 2024. The buyer had to replace the whole roof structure, which was damaged by damp and fungal decay. The court refused the deduction and awarded €51,083.34 (para. 3.25). The decisive factor was that the buyer had had no apparent intention of replacing the roof and had to borrow to pay for it. That the new roof is better "is inherent in the fact that the roof simply had to be replaced in its entirety" (para. 3.24).

Where the repair demonstrably extends the useful life, a deduction may follow, and the fraction set out at the start of this article comes into play. Extension of life is not by itself enough to make a deduction reasonable. The Zeeland-West-Brabant District Court put the useful life of roof shingles at 25 years, and the covering replaced was 8 years old, producing a deduction of one third (paras. 2.9 and 2.10).

Useful life is the most common form of benefit, but not the only one. In a roof replacement the East Brabant District Court took three separate benefits into account: betterment, energy savings and an increase in value (para. 2.2(b)). Elsewhere a benefit remained even after the useful-life deduction had been disallowed, on account of lower maintenance costs and a slightly better resale value. A party who argues only about age therefore overlooks other heads of benefit.

The converse is just as instructive. On 27 September 2022 the 's-Hertogenbosch Court of Appeal refused a contractual deduction in a case about damp. The repair was needed to make the house fit for normal use, and the court added: "Since only localised repair is involved, it will have no appreciable effect on when the roof will need replacing" (para. 3.4.20). Repair that does not defer the replacement date therefore gives rise to no benefit to bring into account.

Against what baseline is the comparison made? That question drives the outcome, and it is answered differently depending on whether the claim arises under a sale or under a contract for work. On a sale the point of comparison is what the purchase agreement promised, which is an old but sound component: the East Brabant District Court held that the buyer was entitled to "a sound 40-year-old roof" (para. 2.2(b)).

Under a contract for work the point of comparison is proper performance, and the lapse of time is then decisive. If the defect comes to light quickly, the employer would have had the same new component in any event. As the Gelderland District Court put it: "Had the defendant carried out his work properly, the claimant would equally have had a new, insulated and watertight roof" (para. 4.5). If the employer has had the benefit of the defective work for years, those years do count: for roof covering laid in 2010 and replaced in 2025, the Overijssel District Court reduced the employer's award by 14/35ths, reflecting 14 years of a 35-year life (para. 5.60).

A contractual clause changes the argument

In the judgments considered here, a deduction on a sale of property usually rests on the purchase agreement itself. Clause 6.3 of the model agreement published by the Dutch estate agents' association (NVM) provides: "For defects which prevent normal use and which the buyer neither knew of nor could reasonably have discovered at the date of this agreement, the seller is liable only for the cost of repair. In assessing the cost of repair, account is taken of the deduction for betterment."

In the case decided by the Central Netherlands District Court on 10 August 2022 this was the 2018 NVM model agreement for an existing house (para. 2.1). The clause recurs in the judgments considered here in the same wording, but always check the agreement itself, because the text differs from edition to edition.

That changes where the argument starts. With such a clause a deduction is more readily applied, and several judgments show that courts sometimes assess the amount themselves where the parties provide too little material to work from.

The Central Netherlands District Court said as much: "Since neither party has specified what the deduction should be, the subdistrict court will determine it." It proceeded on the basis of a roof with a life of at least 40 years which was 17 years old at completion, and arrived at 50% (para. 4.6). Elsewhere the deduction was assessed "as a matter of estimate and reasonableness" at 10% after the sellers named no figure and the buyers pointed only to their invoice (North Holland District Court, para. 4.24).

In the absence of such a clause the bar is higher, because the defendant must then plead and evidence the benefit. The District Court of The Hague accepted that newly installed components last longer (para. 4.34) and still rejected the argument, because no actual benefit had been established (para. 4.35). Two things are needed: identification of the difference in useful life, and a figure for it.

Courts depart from a contractual starting point where no benefit exists. The 's-Hertogenbosch Court of Appeal refused the deduction in the damp case even though it had been agreed. On 28 January 2026 the Limburg District Court did the same, "since the claimants were not required to anticipate the roof being of such poor quality, given the 2021 renovation" (para. 4.38). The same court did apply the deduction on 19 March 2025 in a case about a wet cellar, holding that the buyer could not challenge it as unreasonable because it was "simply part of the agreement concluded with the defendants" (para. 2.5).

The clause therefore provides a starting point, but the substantive test still has to be satisfied.

The head of loss decides the size of the deduction

About half of the judgments considered here fix the deduction head by head; the other half apply one percentage across the whole claim. That difference is rarely accidental: where a claim contains heads of loss of different kinds, it is the apportionment that decides the outcome. That apportionment reflects the direction in Section 6:97 DCC to assess loss in the manner most consistent with its nature, and that nature differs from element to element.

The contrast is sharpest outside residential property. Where a cherry picker had been driven across tennis courts, the Rotterdam District Court awarded the full cost of the drainage system, because it would not have needed replacing but for that incident (para. 4.14), and made an 80% deduction from the cost of the top layer because the playing surfaces were "towards the end of their useful life" (para. 4.24). One event, two heads of loss, two outcomes.

The same approach applies to residential property. In the wet cellar case the Limburg District Court made a 65% deduction from the plasterwork and none from the waterproofing itself, because the buyers "were entitled to expect in any event that the cellars would be watertight" (para. 2.8.2).

In the Zeeland case about the roof shingles the deduction applied to the roof renovation only, while the full cost of the window frames was awarded (paras. 2.7 and 2.10). The point arose on appeal to the Supreme Court as well: it held that the court of appeal had failed to explain why the deduction should also cover "the element of the loss represented by the cost of preventing further damage" (para. 3.3.2).

Once the deduction attaches, it reaches beyond the material replaced. In the Rotterdam case the deduction on the floor insulation carried the demolition and groundworks with it. On 9 July 2025 the Central Netherlands District Court held: "Contrary to what the claimants contend, the deduction for betterment must also be applied to the cost of labour." The reason is that when carrying out maintenance later, the owner would have had to pay his contractor for labour in any event (para. 2.13).

The figures warrant some caution. The occasional judgment does the arithmetic properly, as the Gelderland District Court did for a conservatory 9 years into a useful life of 20 years: 45% (para. 4.13). Far more often the court arrives at a round percentage "in fairness" or "by estimation". In a case arising out of a collision between vessels, the Court of Appeal of The Hague went further. The dates on which the old and new coatings were applied do not form the basis for the deduction: that view "is wrong in law", principally because it is not the statutory test (para. 5.12).

What should a buyer of a defective house do?

Record the condition of the defective component before it is replaced. It is the cheapest thing a claimant can do and it can decide the dispute, because after demolition it is almost impossible to establish how old and how worn the component was. Photographs, the surveyor's report and a quotation itemised element by element are the bare minimum.

Where a great deal turns on it and demolition is unavoidable, consider applying for a court-appointed expert's report before proceedings are issued. Invite the other side in writing to attend the site inspection. In the cases involving large sums it was an expert's assessment that decided the outcome, not the buyer's quotation.

Then split the claim into heads of loss and consider for each head whether the repair extends the useful life. Structural components that ought to be sound in any event more often than not escape a deduction; where a component has a replacement cycle of its own, such as roof covering, insulation or building services, the cost is more often than not reduced. Work that was needed only to gain access to the defect follows the head of loss to which it belongs.

If the purchase agreement provides for a deduction for betterment, a deduction is more readily applied, but an actual benefit is still required. There are three ways round the clause: that there is no benefit, as in the Limburg roof case and the 's-Hertogenbosch damp case; that the clause does not extend to this head of loss; or that the buyer is not bound by it.

That last route has to be raised expressly. In the cellar case the objection failed on exactly that point: the deduction was part of the agreement "and nothing has been pleaded or proved to show why the claimants are not bound by that term" (para. 2.5). It is therefore not enough for a buyer to say the clause is unreasonable, but the door is not closed.

Consider whether the other side is insured. In a case about a farmhouse destroyed by fire the North Holland District Court held that bringing a benefit into account is "hardly ever reasonable" where the event falls under the defendant's liability insurance, referring to the legislature's intention underlying Section 6:100 DCC (para. 4.7). That is a possible argument rather than a general exclusion, and whether it succeeds depends on the circumstances. The point arises mainly in tort, and against a contractor carrying public liability insurance. It rarely arises against a private seller, because a standard personal liability policy does not extend to contractual liability for a defective house.

Work out the fraction and advance it in the alternative. A party who puts forward no figure leaves the choice to the court, and that rarely turns out well. In the Central Netherlands roof case the subdistrict court took 17 of 40 years and rounded the resulting 42.5% up to 50%. In the North Holland case it assessed 10% by estimation, neither party having named a figure.

Consider whether the other side has made out its case. In the absence of a contractual clause it must identify the normal useful life, how many of those years have elapsed, and express the difference in money. A reference to a supplier's website has been held insufficient, and in the case before it the Amsterdam Court of Appeal required evidence of the increase in the property's value, corrected for the general movement of the property market. Other judgments are content with a useful-life or maintenance approach without valuing the whole house.

Finally, do not let the claim drift. In the Rotterdam farmhouse case the buyers were entitled to wait for the outcome of the proceedings and the court worked from the most recent quotation (para. 2.11); in the Limburg motorhome case the price increase fell on the injured party after 3 years of inaction (Limburg District Court, para. 4.21). More on the steps leading up to such a claim is set out in the analysis of hidden defects after buying a home.

Frequently asked questions

Can the deduction exceed half?

Yes, and that happens regularly. In the judgments considered here the percentages applied range from 10% to 80%. The highest deductions fall where the component replaced was practically at the end of its useful life, such as an artificial grass surface at 80%, or where only a finishing layer was renewed, such as the plasterwork in the cellar case at 65%. A high percentage stands or falls with the evidence on the remaining life.

Does the deduction apply to labour as well as materials?

The case law used to diverge, and on 9 July 2025 the Central Netherlands District Court chose to apply it to both. An earlier Gelderland judgment had confined the deduction to material costs, but expressly because of the circumstances of that case. The wider line rests on the point that on a later replacement of his own the owner would have had to pay installation costs too. Have materials and labour itemised separately in the quotation.

May the court apply the deduction without the other side asking for it?

Caution is called for. In a motorhome case the subdistrict court in Tilburg dealt with the deduction under a separate heading of its own motion, although the judgment records no submission to that effect. In the water main case, by contrast, the Supreme Court criticised the court of appeal for assuming a state of affairs for which there was "no basis in the material before it". In the 2016 cartel judgment it also held that the court is free to choose how it brings the benefit into account, having regard to the way the parties have argued the case. The safer view is that the point must be pleaded and evidenced.

Cited case law

Sixty judgments on the deduction for betterment handed down up to and including February 2026 were reviewed for this article. The judgments the text rests on are set out below.

Supreme Court: ECLI:NL:HR:2023:956 (23 June 2023, even where repair costs are assessed objectively a benefit may be brought into account, subject to the requirement that the injured party must not have a pattern of expenditure forced upon him); ECLI:NL:HR:2016:1483 (8 July 2016, TenneT/ABB, the court is free, having regard to the way the parties have argued the case, to take the benefit into account either in assessing the loss or under Section 6:100 DCC, because the two approaches do not differ materially).

Advocate General's opinions: ECLI:NL:PHR:2022:1132 (2 December 2022, betterment concerns expenditure forced upon the injured party and the case law of the lower courts on the point diverges; applying Section 6:100 DCC calls for four questions).

Courts of appeal: ECLI:NL:GHAMS:2024:54 (9 January 2024, no deduction on a full roof replacement the buyer had no intention of making and for which she had to borrow, and the benefit is measured as the increase in value corrected for the general movement of the property market); ECLI:NL:GHDHA:2022:1850 (28 June 2022, the dates on which the old and new coatings were applied are not the statutory test, and the injured party need not keep investing in order to realise a theoretical benefit); ECLI:NL:GHSHE:2022:3269 (27 September 2022, an agreed deduction does not apply to localised repair that does not appreciably defer the replacement date).

District courts: ECLI:NL:RBROT:2023:542 (4 January 2023, three heads of loss with three deductions, an essential structural component escaping any reduction while necessary foundation repair is halved); ECLI:NL:RBZWB:2026:662 (4 February 2026, roof shingles 8 years into an estimated life of 25 years give a deduction of one third, on the roof renovation only); ECLI:NL:RBOVE:2025:5429 (3 September 2025, 40% under Section 6:100 DCC on account of reduced maintenance and a longer useful life of the building); ECLI:NL:RBMNE:2025:3523 (9 July 2025, the deduction covers the cost of labour as well); ECLI:NL:RBLIM:2025:7641 (23 July 2025, a party who delays repair for years cannot recover the increased repair costs); ECLI:NL:RBLIM:2025:8668 (19 March 2025, 65% on the plasterwork and nothing on waterproofing the cellar, which the buyers were entitled to in any event); ECLI:NL:RBLIM:2026:783 (28 January 2026, no deduction despite the clause, because the buyers were not required to anticipate the poor quality after a renovation in 2021); ECLI:NL:RBGEL:2024:1960 (10 April 2024, a conservatory 9 years into a useful life of 20 years gives 45%); ECLI:NL:RBGEL:2024:485 (31 January 2024, under a contract for work the point of comparison is proper performance, so sound work would have produced the same new roof); ECLI:NL:RBOBR:2023:4991 (20 September 2023, the buyer was entitled to a sound 40-year-old roof, so the argument that repair merely removes the defect fails); ECLI:NL:RBROT:2021:10211 (13 October 2021, the full cost of the drainage awarded and an 80% deduction from the artificial grass top layer in the same case); ECLI:NL:RBMNE:2022:3469 (10 August 2022, the court determines the amount itself where neither party puts forward a percentage); ECLI:NL:RBNHO:2022:1923 (2 March 2022, 10% by estimation for a roof that was 3 years newer and had gained an insulating layer); ECLI:NL:RBNHO:2021:11280 (8 December 2021, bringing a benefit into account is hardly ever reasonable where the event falls under the defendant's liability insurance); ECLI:NL:RBDHA:2017:7419 (5 July 2017, the benefit is accepted in principle but the argument fails for want of a pleaded and evidenced case); ECLI:NL:RBZWB:2024:1080 (21 February 2024, 50% assessed for a 1995 motorhome with old components).

Juriaan de Vries is a lawyer at Prime Law and acts in disputes about defects arising under contracts of sale and contracts for work. See the disclaimer.

Betterment and repair costs: when may a seller refuse to pay part of the bill?