Recent judgment | What does the ruling from the municipality of utrecht teach us about contract terms and amendments?

The ruling concerns a concession contract for the installation and operation of fast chargers for the municipality of Utrecht. The concession holder failed to meet the requirement to install the fast chargers by April 1, 2023, at the latest. However, according to the Court of Appeal, the municipality was not obliged to extend the installation deadline. Nor was the municipality required to cooperate with a change to the dimensions of the chargers to be installed. The court ruled that this would constitute an unlawful modification of the contract.

Conflicting case law: District Court of The Hague judgment

This ruling is interesting in light of a recent judgment by the District Court of The Hague. There, the interim relief judge ruled that the contracting authority was allowed to amend the contract to enable performance after all.

Enforcement of contractual requirements

Viewed together with other rulings, there appears to be inconsistency in how contractual requirements are enforced. Meanwhile:

• Failure to enforce requirements under procurement law constitutes a modification of the contract, to which Articles 2.163a et seq. of the Dutch Civil Code (Aw) apply.
• Case law often views the contracting authority’s conduct as a discretionary power. In other words, the courts seem to rule that it is up to the contracting authority whether or not to take contractual measures, even if this results in an unlawful modification.
• From a procurement law perspective, requirements should actually be strictly enforced. These requirements are not drawn up without reason. Strict enforcement protects not only the client but also the other bidders to whom the contract was not awarded. The principle of equality applies even after the contract has been concluded.

Document changes clearly

The ruling underscores for both contracting parties the importance of clearly documenting agreements on changes. According to the court, merely discussing a change is not sufficient, as this does not yet demonstrate agreement on the amendment.

For contracting authorities, the ruling also signals the importance of responding in a timely and substantiated manner to change requests from the contractor. In this case, the municipality responded four days before the deadline. While the court did not find this unlawful, it did not consider it exemplary. In my opinion, this is a fair ruling, but one that applies to all contract parties.

This blog is part of the series ‘Procurement: What – How?’, in which Joris Bax, attorney at Brackmann, shares his insights and reflections on current topics in procurement and construction law.