NULLIFICATION OF A BINDING ADVICE UNDER THE LAWS OF THE NETHERLANDS ANTILLES AND ARUBA
Nullification only possible on limited grounds
Court proceedings are time consuming and cost a lot of money. Also, Court decisions do not always offer an acceptable solution. It is for those reasons that more and more parties choose another form of conflict control: arbitration, mediation or binding advice.
The binding advice given by a conciliation board (e.g. a consumer conciliation board or a board composed of party appointed members) is not a judgment. Between the parties the binding advice has the same force as an agreement. The binding advice can if necessary be made enforceable by recourse to the court following a marginal substantive and procedural review.
If a dispute is made subject to binding advice, the agreement usually stipulates that the decision is final and irrevocable. However, one of the parties could initiate proceedings on the merits trying to nullify the binding advice. The court will nullify a binding advice if no reasonable-minded person would have rendered the contested binding advice.
The court will also nullify the advice if the board has violated fundamental principles of due process law, e.g. the right to be heard and the independency and impartiality (of the members of the board).
It appears from case law that a binding advice will be nullified if the outcome is unreasonable and unfair. The mere fact that one of the parties disagrees with the outcome or the fact that there are some imperfections, does not mean that the binding advice is unreasonable and unfair. So the binding advice has to be obviously wrong. A binding advice is unreasonable and unfair if it is insufficiently substantiated or the board has rejected relevant statements or arguments of the parties without motivation. Another ground for nullification is if the board did not keep to the provisions of the binding advice agreement.
Karel Frielink
Attorney (Lawyer) / Partner
