TERMINATION OF EMPLOYMENT AGREEMENT AND REDUNDANCY
Termination by mutual consent is preferable
In general, Curacao labor law provides for the following ways to terminate an employment agreement: (i) termination by giving notice, (ii) dissolution by the Courts and (iii) termination by mutual consent.
Prior to giving notice, an employer must obtain a permit from the Director of the Directorate of Labor Affairs. The Director will determine whether there is a valid reason for the dismissal. In the case of redundancy the employer is obliged to provide a detailed financial justification thereof. If in agreement, the Director of the Directorate of Labor Affairs may issue a permit …
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BREACH OF CONTRACT IN THE DUTCH ANTILLES (V)
Restrictions on termination
With regards to damages, the aim thereof is generally to restore the creditor to the position he would have been in had the contract been fulfilled. In case of breach of contract, the damages will usually be assessed by considering the situation the creditor would be in if restored to the position he would have been in had the contract been performed properly, by looking at costs incurred, wasted expenditure, any loss of profits etc.
The Netherlands Antilles Civil Code will generally allow an injured party to claim damages based on the expectations/positive interest, i.e. the position …
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BREACH OF CONTRACT IN THE DUTCH ANTILLES (IV)
Non-performance as a response to non-performance
Whenever a party to a contract is faced with non–performance by the other party, the party’s first reaction might well be to suspend its part of the contract. In the legal sense of the word, suspending or withholding performance may be described as both a defense and a self help remedy, which a party can use when the other party does not perform its obligations under the contract. By its very nature it is a temporary remedy. As long as one party is in breach and the other is withholding its performance, the contract …
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BREACH OF CONTRACT IN THE DUTCH ANTILLES (III)
Different cases of breach of contract
Any question of breach starts with an inquiry into the type of obligation at hand. It is necessary to know more about the type of obligation at hand in order to determine whether a party has failed to perform that obligation. When determining whether a party has failed to perform, it should be remembered that an obligation may carry with it a degree of ‘strictness’, ranging from a firm commitment, e.g. commitment to provide annual audited financial statements, to an obligation to use reasonable care and skill to achieve certain goals.
The Netherlands Antilles …
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BREACH OF CONTRACT IN THE DUTCH ANTILLES (II)
Entitlement to specific performance
Under the Netherlands Antilles Civil Code the demand for specific performance is not a remedy for breach of contract in a strictly legal technical sense. In this system the entitlement to specific performance is a consequence of the duty to perform a (contractual) obligation. The contract itself, and not the breach of it, entitles the creditor to specific performance. If non–performance amounts to a breach of contract, i.e. meaning that a party does not perform though it should perform, the other party may be entitled to damages or termination of the contract.
However, in some cases, …
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AGENCY AND DISTRIBUTION AGREEMENTS IN THE NETHERLANDS CARIBBEAN (II)
Distribution agreement
So-called agency agreements frequently bear resemblance in actual practice, to (certain aspects of) distribution agreements. Hence, so-called ‘agency agreements’ are in actual fact not infrequently mixed type agreements, consisting of an agent and a distribution element.
In general, a distributor buys goods from a principal in his own name and for his own account and resells these goods to third parties in his own name and for his own account.
Distribution agreements are not defined in any Netherlands Antilles statute and are not subject to any specific Netherlands Antilles legislation. The distribution agreement is an agreement sui generis, …
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AGENCY AND DISTRIBUTION AGREEMENTS IN THE NETHERLANDS CARIBBEAN (I)
Commercial Agency Agreement
According to Section 7:428, Paragraph 1, of the Netherlands Antilles Civil Code, a commercial agency contract (agentuurovereenkomst) is a contract for services whereby one party, the principal, instructs the other party, the commercial agent, and whereby the latter binds himself, for a fixed or indeterminate term and for remuneration, to act as an intermediary in the conclusion of contracts, and, as the case may be, to enter into such contracts in the name and for the account of the principal, without being his subordinate.
No procedural requirements apply for entering into an agency agreement, and it may …
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FRANCHISE AGREEMENTS UNDER THE LAWS OF ARUBA (II)
Case law regarding termination
It can be concluded from a Netherlands Antilles case regarding failed negotiations for the continuation of a license agreement (franchising) (Antillean Family Foods NV vs Mc Donald’s Corporation, Supreme Court, February 26, 1993, NJ 1993, 289), that under certain circumstances the termination of an agreement may constitute an obligation (to negotiate a renewal of contract or) to pay damages / compensation.
Possible areas of relevance are: the contents of the agreement and the circumstances under which the agreement was entered into; the amount invested by the franchisee and the extent to which the investment was recouped; …
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AGENCY AGREEMENTS IN THE DUTCH CARIBBEAN
An agent is entitled to commission
Under the Civil Code of the Netherlands Antilles (article 7:428), an agency agreement is defined as a contract for a fixed or indefinite period of time between a principal and an agent, whereby the agent agrees, against payment, to mediate in the conclusion of contracts and to eventually conclude these contracts in the name and for the account of the principal, without being subordinate to the principal.
An agent shall be entitled to a commission for the negotiation of commercial transactions concluded after the sales representation contract has been terminated:
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MASS LAY-OFF UNDER THE LAWS OF THE DUTCH CARIBBEAN
Permission required
The termination of the employment contracts of more than 25 employees or of 25% or more of the employees of a company is considered a mass lay-off. For such a mass lay-off permission is required from the Director of the Department of Labor and Social Affairs irrespective of the nature of the company’s activities. The Director must be informed by the employer at least two months prior to the (intended date of) termination of the employment contracts. Simultaneously, or at least within eight days of notifying de Director the employer must provide the Director with a redundancy arrangement …
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