Instalment payments and delivery up in construction
A contractor renovating two swimming pools claimed the final instalments of the contract sum. The municipality claimed substitutionary damages for the works it had third parties complete. That conversion did not cause the instalments to fall due, and the Supreme Court upheld the ruling. The case goes on to address additional work without approval, the penalty for late delivery up and the burden of disputing expert reports.
Municipality withholds final instalments after pool renovation
The Court of Appeal in 's-Hertogenbosch held the contractor to the payment schedule. Instalments 4, 5 and 6 of the contract sum went unpaid and its additional-work claim succeeded only in part. That the Supreme Court added nothing to this follows from Section 81 of the Judiciary (Organisation) Act: on 20 March 2026 it dismissed both the contractor's principal appeal and the municipality's cross-appeal without reasons (ECLI:NL:HR:2026:459). The substantive analysis therefore lies in the Opinion of Advocate General Drijber of 19 December 2025 (ECLI:NL:PHR:2025:1407).
The Municipality of Drimmelen put the renovation and partial new-build of the De Randoet swimming pool in Made and Het Puzzelbad in Terheijden out to tender in four lots. The structural works went to this contractor. On 17 September 2019 a separate tiling agreement was added for replacing the tiling in the deep basins, with a contract sum of €588,400. Following the construction-team phase, the contract for work for the structural works followed on 31 October 2019, with a contract sum of €846,612 and the UAV 2012 (the Uniform Administrative Conditions for the Execution of Works) applying.
The payment schedule comprised six instalments, tied to the progress of the works: 25 per cent at the start of construction, 10 per cent at 25 per cent completion, 25 per cent at 50 per cent completion, 25 per cent at 75 per cent completion, 10 per cent at 100 per cent completion and delivery up, and 5 per cent at the end of the six-month maintenance period. The works were to be executed by 1 April 2020 and fully ready for use on 17 April 2020.
The works overran. On 21 April 2020 the municipality gave the contractor notice of default. The tiling works were delivered up on 19 May 2020. On 2 June 2020 the remaining works were inspected, producing three inspection schedules full of outstanding items, and that record was signed on behalf of the municipality alone. The new-build entrance building of Het Puzzelbad remained unfinished. By letter of 3 December 2020 the municipality stated that the remaining works would be carried out by a third party and that the contractor would no longer be given the opportunity to do so.
Conversion under Section 6:87 DCC leaves instalments not due
Instalment 5 was conditional on "100% complete and delivered up". The Court of Appeal found that neither had occurred, so that instalment had not fallen due. Because delivery up within the meaning of § 11 UAV 2012 never took place, the maintenance period had not begun either and instalment 6 had likewise not fallen due.
That ruling rests on a strict reading of delivery up. The parties had not agreed on partial delivery up and the UAV 2012 does not provide for it. The record of 2 June 2020 carries the word delivery up in its title and in its text, but in the view of the Court of Appeal its content shows that this was an inspection. Given the unfinished state of the works, as that record expressly noted, the works were not ready for delivery up on that date. A record called a delivery-up record therefore does not itself produce delivery up.
For the works not carried out and inadequately remedied, the municipality claimed substitutionary damages. The Court of Appeal characterised that claim as a declaration of conversion within the meaning of Section 6:87 of the Dutch Civil Code: the contractor's obligation to complete and deliver up the works gave way to an obligation to pay damages.
The contractor built its complaint on that. The obligation to deliver up no longer existed, so the condition "100% complete and delivered up" could never again be fulfilled. The municipality's counter-performance therefore had to fall due at some point, and on the contractor's case from the moment the declaration of conversion was made.
Advocate General Drijber rejected that argument, referring to Supreme Court 4 December 2020 (ECLI:NL:HR:2020:1954). The Supreme Court held there that, on conversion of an obligation arising from a reciprocal agreement, the creditor remains bound to render its own performance, because the agreement itself has not been rescinded. That creditor's obligation undergoes no change, and the same applies to the moment at which it falls due.
That last point sounds like a contradiction, since after conversion the moment of falling due is tied to something else. What remains unchanged is the regime: the contractual payment schedule stays decisive and is not displaced by the conversion. What changes is the obligation to which that schedule refers. The contractor must therefore first perform its own obligation, which after conversion is paying substitutionary damages. Only at that moment can the municipality's counter-performance fall due.
The line is not fully settled. Earlier Opinions have argued that a provision on falling due which fitted the original contractual scheme need no longer be decisive after conversion. There is something to be said for that, in the Advocate General's view, but the Supreme Court expressed itself in general terms in 2020 and left it there. He does consider the Court of Appeal's reasoning imprecisely worded. The Court wrote that the instalments are still not due because the works have not yet been delivered up, whereas delivery up was no longer at issue after the conversion. That did not lead to cassation, because the result was correct. The Advocate General adds that a claim for substitutionary damages is rarely encountered in practice, and that the alternative of partial rescission, with price reduction as its effect, is generally more attractive. That route runs through Section 6:265 DCC.
Instalment 3 came unstuck on a different point. The contractor asserted that the employer's supervisor had approved that instalment but did not substantiate this, and at the time of invoicing there was no inspection showing that the works were 50 per cent complete. Its falling due was therefore not established, with the result that the interest claim on that instalment was refused.
Why the tiling instalments did fall due
The same building site produced the opposite outcome under the second agreement. With the tiling works too, the works were not yet 100 per cent complete at the time of inspection and the maintenance period had not begun. The difference was that on appeal the municipality accepted the District Court's finding that the tiling works had been delivered up. The outstanding instalments under the tiling agreement had therefore fallen due.
The pivot is thus delivery up, and not whether there are defects. Defects operate along a different route. In view of the claims arising from reduced work, works not carried out on time and inadequately, and defects in the works, the municipality was entitled to suspend payment of the outstanding instalments under the contract for work. No statutory commercial interest was therefore payable on those instalments. Falling due is moreover not the same as being paid out. The tiling agreement is a supplementary instruction, so the claims under the two agreements are sufficiently connected that the municipality may set off amounts under one against the other. For what amount it was entitled to suspend and set off, and on what balance it owes the contractor interest, the Court of Appeal could not determine. That too goes to the damages-assessment proceedings.
Additional work without approval and the "unless" provision
The contract for work does not state when additional work arises, so § 36 UAV 2012 supplies the test. Its wording is close to that of Section 7:755 DCC. Where the employer wants a change to the specification, the contractor may claim an increase in the price only if it warned in good time of the need for that increase, unless the employer ought to have understood that need of its own accord. Under that "unless" test only the need for an increase counts, and not whether the employer had insight into its size. If the test is met and the amount of the increase was not fixed, or only a target price was agreed, then Section 7:752 DCC provides that a reasonable price is payable. The Court of Appeal derived that second step from Supreme Court 1 July 2022 (ECLI:NL:HR:2022:989).
The municipality pointed to additional arrangements made at the construction meeting: additional work had to be approved in advance and could be invoiced only after the site management had approved the works. It also objected that the contractor had never warned of price increases. The Court of Appeal did not follow it: where the works have been changed by circumstances that remain at the municipality's risk, it cannot hold the absence of prior approval or of a warning against the contractor. The Advocate General explains why this does not circumvent the arrangements. They supplement the duty to warn but do not detract from the "unless" provision. It weighed in that in the cases at issue the contractor had notified the supervisor that in its view there was additional work, and that the supervisor had confirmed this on each occasion.
The "unless" provision took the contractor only part of the way. The burden of pleading and proving that there is additional work eligible for payment rests on it. Where the municipality substantiated, by reference to the schedule of requirements and the scope demarcation list, that works had already been instructed, the contractor did not substantiate its claim any further, and those items were refused. Of the more than €245,000 in additional-work invoices, €103,488.14 survived. These additional-work findings formed the municipality's cross-appeal in cassation, which was likewise dismissed.
Penalty and deduction: two bases, two amounts
The €16,960 in penalties the contractor was ordered to pay rests on two different bases. For the tiling works, the penalty clause in article 11 of the tiling agreement applied: €10,000 per breach, plus €60 for each day the non-performance continues. The Court of Appeal construed that clause as relating to the works as a whole, so the municipality could not forfeit the penalty twice merely because two swimming pools were involved. The term "day" is not defined in the agreement, and because the UAV 2012 had also been declared applicable to the tiling agreement, the Court counted in working days. Taking the later agreed delivery-up date of 15 May 2020 and delivery up on 19 May 2020, the penalty came to €10,060.
For the contract for work that clause does not apply, because it sits in the tiling agreement. There the sanction ran through the deduction (korting) under § 42(2) and (3) UAV 2012. Taking 15 May 2020 and the end-of-works date of 1 November 2020 relied on by the municipality, again in working days, that produced €6,900. The municipality had claimed €40,240 for the tiling works and €10,200 for the deduction, alongside €33,480 in deductions not yet invoiced. On both counts it therefore recovered considerably less than it sought.
The Court of Appeal set aside the judgment of the District Court of Zeeland-West-Brabant and gave a fresh decision. Set against the additional work awarded is €23,769.88 in reduced work, out of the €78,152.16 the municipality had claimed for it, so the balance of additional and reduced work comes to €79,718.26 in the contractor's favour. On top of that it must pay the municipality those penalties and €875 in extrajudicial costs, plus substitutionary damages to be assessed in separate proceedings, both for completing the works and for remedying the tiling. The end point therefore lies outside this judgment: the question whether the municipality owes the outstanding invoices under both agreements, and the interest on them, was also referred to the damages-assessment proceedings.
In cassation the contractor complained that the penalty had been imposed twice, at first instance and on appeal. That complaint lacked any factual basis, because setting aside the judgment also removed the earlier penalty order. The order to repay what the municipality had paid in performance of the judgment was struck out by supplementary judgment.
A dispute without a counter-expert report fails
The municipality put three Technoconsult reports into the proceedings, dated 3 March 2021, 22 February 2024 and 2 July 2024. The contractor objected on the basis of the proper conduct of proceedings and sought leave to respond by written submission (akte). The Court of Appeal refused. The exhibits were filed in good time, the contractor had a good five months to respond to the second report, the third was filed a good three weeks before the hearing and updated the second report it already knew, and at the oral hearing of 19 September 2024 sufficient opportunity to respond was afforded.
The Advocate General takes that further, and this is where the procedural footholds come from. The second report entered the proceedings by court form of 27 February 2024, more than six months before the hearing, and that time went unused. Responding was possible without prior leave from the Court of Appeal: Section 82 of the Dutch Code of Civil Procedure permits a written submission before or on a cause-list date, applies on appeal by virtue of Section 353(1), and such a submission may contain a response to an exhibit. That the contractor took the risk of awaiting a decision of the Court of Appeal is for its own account. The third report was filed on 27 August 2024, a good ten days before the hearing and therefore in good time under Section 87(6).
On the substance, the contractor set no counter-expert report against the three reports. The Court of Appeal held that its dispute of the alleged defects was, as a result, insufficiently reasoned. In cassation the contractor complained that a party disputing an assertion may not be held to the same requirements as the party making it, and that a party-commissioned report cannot be contradicted solely by a counter-report. That complaint lacks any factual basis, in the Advocate General's view, because the Court of Appeal never held this. Its ruling amounts to this: against three reports stood a poorly substantiated dispute. With a report of its own the outcome could have been different, and a counter-report was the obvious move here, but the Court did not hold that this was the only thing that could have saved the contractor.
What does this mean for contractors and employers?
For the contractor, the lesson is that an employer's conversion does not lift the delivery-up condition out of the payment schedule. Anyone wanting to collect instalments tied to delivery up delivers up. If that fails to happen and the employer converts, the condition shifts to paying the substitutionary damages, which is usually the opposite of an improvement. Leaving the works unfinished also holds back the contractor's own claim.
Record progress at the moment an instalment is invoiced. Instalment 3 came unstuck on precisely that point: there was no inspection showing that the works were 50 per cent complete, and an asserted but unsubstantiated approval by the supervisor did not fill that gap.
On additional work, the "unless" provision survives procedural approval arrangements, but the burden of pleading stays with the contractor. In this case most of the additional-work items failed on substantiation rather than on the duty to warn. So substantiate item by item that the works fell outside the instruction and were necessary, and set that against the schedule of requirements and the scope demarcation list with which the employer will argue the opposite.
For the employer, the gain lies in the record-keeping. A record with the words delivery up in its title does not bind the employer where its content describes an inspection, but anyone wanting to be able to accept or refuse partial delivery up should agree it, because the UAV 2012 does not recognise the concept. And a party alleging defects should do so with reports that identify item by item what is wrong, filed early enough to give the other side an opportunity to respond. That last point is what defeated the objection based on the proper conduct of proceedings here.
A party faced with such reports should not leave matters at a dispute in general terms. Commissioning an expert report of one's own is not mandatory, but its absence may prove decisive, and awaiting leave to respond is at that party's own risk.
Frequently asked questions
Must an employer still pay if it claims substitutionary damages?
Conversion leaves the payment schedule intact. Because conversion does not rescind the agreement, the employer remains bound to render its own performance, and that obligation does not change, including as to the moment it falls due. Where an instalment is tied to delivery up, that condition shifts to payment of the damages. A party wanting the payment obligation to lapse must rescind.
Is a signed delivery-up record decisive?
Content decides, not the title. The Court of Appeal read a record called a delivery-up record as an inspection, because it expressly set out which works had yet to be completed and the attached inspection schedules were full of outstanding items. Signature by both parties was also absent here. Without agreed partial delivery up, partially finished works do not count as delivered up, so the maintenance period does not start running either.
Can a contractor invoice additional work that was not approved in advance?
Yes, if the employer ought to have understood the need for the price increase of its own accord. An arrangement that additional work must be approved in advance supplements the duty to warn and does not disapply the "unless" provision. The contractor does bear the burden of pleading that the item was not already covered by the instruction and that carrying it out was necessary. So the employer cannot rely on the absence of approval, and equally need not pay for items where that is not demonstrated.
Cited case law
Supreme Court
- ECLI:NL:HR:2026:459 (20 March 2026) — Section 81 of the Judiciary (Organisation) Act; both the contractor's principal appeal and the municipality's cross-appeal dismissed.
- ECLI:NL:HR:2020:1954 (4 December 2020) — on conversion under Section 6:87 DCC the creditor remains bound to render its own performance and its obligation undergoes no change, including as to the moment it falls due.
- ECLI:NL:HR:2022:989 (1 July 2022) — where the "unless" provision is met and the amount of the increase was not fixed, or only a target price was agreed, Section 7:752 DCC makes a reasonable price payable.
Advocate General
- ECLI:NL:PHR:2025:1407 (19 December 2025) — Opinion of Advocate General Drijber: the contractual payment schedule remains decisive after conversion, so the counter-performance falls due only once the debtor pays the substitutionary damages.
Courts of Appeal
- ECLI:NL:GHSHE:2024:4052 (17 December 2024) — without agreed partial delivery up, an inspection of unfinished works is not delivery up, even where the record bears that name; where the works have been changed by circumstances remaining at the employer's risk, it cannot rely on the absence of approval or of a warning for additional work.