International Law

NEGOTIATIONS IN THE DUTCH CARIBBEAN ARE SUBJECT TO THE PRINCIPLE OF GOOD FAITH

By Karel.Frielink

Disclosing or investigating?

Under Dutch Caribbean law, during negotiations parties enter into a contractual relationship governed by good faith. This means that each party should take into account the justified interests of the other party. Each party should also take reasonable steps to avoid the other party reaching an agreement based on false assumptions.

When should a party investigate or disclose? The extent to which a party, e.g. a buyer, has a duty to investigate depends on the factual circumstances of the particular transaction, including its nature and complexity. The other party, the seller, has a duty to disclose certain information, the extent of which also depends on said circumstances. There are no hard and fast rules regarding this.

As a general rule each party may rely on the statements of the other party and it is therefore essential that the parties do not deliberately mislead each other during negotiations.

Karel Frielink
Attorney (Lawyer) / Partner

Full post as published by Karel's Legal Blog on March 24, 2008 (boomark / email).