A quote is one thing and the amount on the bill is sometimes quite another, as Harry van Schijndel experienced after re-entering his cabin. Van Schijndel found that the interior of his boat was beginning to look a bit bad and visited a yacht carpentry company with the request to make an offer for the re-furnishing of the cabin. The company sent Van Schijndel a quote with the request to return it signed. The yacht company would paneling the cabin in teak; walls, cabinets, a bed with hatches and doors, ceiling and solid mouldings. The quotation did not contain a concrete amount but the statement that an hourly rate of €37.50 would be used and that the work would be carried out under direction. The carpentry firm had indicated verbally that the work would cost roughly €5,000 in labour and about €750 in material costs. De Wit calculated that the work would be done for about € 6.000,00 plus VAT.
Harry van Schijndel was shocked when he received the invoice: over € 9.000,00 (excluding VAT)! This was not what he had expected based on what he had been told and he refused to pay the invoice. According to the yard, van Schijndel had ordered additional work that would have fallen outside the budget. Van Schijndel could still agree with the comments regarding the additional work, but thought that this should not be more than € 1,000.00 extra, so that the total should amount to approximately € 7,000.00 (plus VAT).
The parties could not reach an agreement and Mr. Frits was asked for advice. This agreement can be interpreted as a contract for work. According to Section 7:750 of the Dutch Civil Code, this means: “The agreement whereby one party, the contractor, undertakes towards the other party, the principal, to carry out and deliver a material work, without his involvement, for a price in money to be paid by the principal”.
Article 7:752 (1) of the Dutch Civil Code states: If the price was not determined when the contract was concluded or if only a recommended price was determined, the client shall owe a reasonable price.
Article 7:752 of the Dutch Civil Code stipulates in paragraph 2: “If a recommended price was determined, this recommended price may not be exceeded by more than 10%, unless the contractor has warned the principal as soon as possible of the likelihood of a further increase in the price in order to give him the opportunity to limit or simplify the work as yet”.
Subsection 3 goes on to state that subsection 2 also applies to contracting work where the price is made dependent on the time estimated in the contract to perform the work.
The contract did not specify a price and the yard’s commitment was oral and contested, so the discussion focused on what would be a reasonable price in this case. The hourly specifications did show that the yard had put in a lot of hours. However, legal proceedings would be very costly for Van Schijndel. The court would not want to pass judgment without an expert’s opinion. Therefore, the proposal was made to the shipyard to appoint an expert who would assess the positions of both parties as a binding advisor. The expert examined the case and concluded that the yard had indeed overcharged for hours. The invoice was not considered reasonable and had to be reduced by 25 percent. Thus, a substantive judgment was still given without Van Schijndel facing enormous costs and a long legal procedure. Given the relatively minor importance, this was a solution he could live with.
Tip: When you enter into an agreement, make sure that a written budget is drawn up with a clear description and, if possible, also a concrete amount. Agree that additional work must first be approved by you in writing and record the financial consequences. Directed: This term means that the contractor has the freedom to determine how the work will be carried out, particularly with regard to the time to be spent and that therefore usually no agreement on the maximum number of hours applies. On the other hand, there is a fixed contract price for the work, which will only be settled in respect of any additional or less work. Such a final agreement gives the client a much firmer grip on the budget and the costs, so that disappointments are avoided afterwards.