On 9 May 2023, a Dutch court rendered a decision (in Dutch only) on the amount of court fees parties are required to pay in Dutch annulment proceedings. The decision provides welcome clarification and hopefully heralds a more consistent approach amongst Dutch courts on this topic.
Arbitration between BAM and Prorail
BAM Infrarail B.V. ("BAM") offers services to ProRail B.V. ("Prorail"), the Dutch governmental organisation responsible for maintaining and extending the railway network infrastructure in the Netherlands. A dispute arose between the two parties, as a result of which BAM decided to initiate arbitral proceedings against Prorail under the arbitration rules of the Netherlands Arbitration Institute (the "NAI Arbitration"). In the NAI Arbitration, BAM pursued a claim of EUR 11 million.
In its final award of 28 June 2022 (the "Award"), the Tribunal fully dismissed BAM's claim. As BAM was obviously unhappy with this outcome, it started annulment proceedings on 28 September 2022 (the "Annulment Proceedings"). Under the Dutch arbitration rules, annulment proceedings take place before the court of appeal in the district where the arbitration was seated. As a consequence, the annulment proceedings between BAM and Prorail fell within the jurisdiction of the Arnhem-Leeuwarden Court of Appeal (the "Court of Appeal").
Court fees in Dutch civil proceedings
Court fees in Dutch civil proceedings are governed by the Court Fees (Civil Cases) Act (Wet griffierechten burgerlijke zaken) ("Court Fees Act"). Under the Court Fees Act, as a general rule, a pro-rata court fee applies depending on the amount in dispute. An exception to this rule are cases where the relief sought does not have a monetary value (e.g. requests for declaratory relief or injunctions). A fixed, flat rate of EUR 783 applies to this type of case.
BAM's court fees' challenge
In the Annulment Proceedings between BAM and Prorail, the clerk of the Court of Appeal applied a pro-rata court fee of EUR 11,379 based on the amount in dispute. BAM initially paid the requested amount in order to secure the annulment process, but – at the same time – challenged the amount of court fees it had been charged. BAM argued that it should have been charged only the fixed flat rate court fee of EUR 783 that applies to non-monetary claims, as it merely sought to annul the Award and therefore was not claiming any amount of money.
The clerk disagreed with BAM's challenge and maintained the position that EUR 11,379 was the right amount to be charged in the Annulment Proceedings. In that regard, the clerk contended that BAM sought annulment of the Award rendered in the NAI Arbitration, which meant that the amount claimed in the NAI Arbitration should still be decisive for determining the amount of court fees applicable in the Annulment Proceedings.
The Court of Appeal's ruling on the challenge
In its decision of 9 May 2023, the Court of Appeal ruled in favour of BAM. According to the Court of Appeal, BAM's application to annul the Award is a non-monetary claim to which a court fee of only EUR 783 applies. To that end, the Court of Appeal concluded that, under Article 10 of the Court Fees Act, the amount of court fees should be determined on the basis of "the claim in the writ of summons". As BAM's writ of summons only contained an application to annul the Award, there was no claim that related to the substantive dispute between the parties that was subject to the NAI Arbitration. The initial claim of EUR 11 million that BAM pursued in the NAI Arbitration was therefore not something to consider when determining the amount of court fees.
Decision by the Court of Appeal is a first
The Court of Appeal's decision is the first published decision in which a Dutch court rules specifically on the amount of court fees payable in Dutch annulment proceedings. Although the decision of the Court of Appeal breaks new ground, it should come as no surprise. Article 10 of the Court Fees Act – as also referred to by the Court of Appeal – leaves little room for discussion: the amount of court fees should be based on the claim that is included in the writ of summons. Since an application to annul an arbitral award does not relate to any amount of money, it makes sense to consider such claim as non-monetary when determining the applicable court fees. This is the case regardless of the relief sought in the arbitration. After all, as the Court of Appeal ruled, in annulment proceedings, "the substantive dispute between the parties is not subject to a review by the Court [of Appeal]".
The Court of Appeal's decision also makes clear that different rules apply to annulment proceedings than to regular appeal proceedings. In regular appeal proceedings, it is a common practice to determine the court fees based on the claim at first instance. Similarly, it could be argued that court fees in annulment proceedings should also be based on the claim at first instance (i.e. the arbitration). However, with only a limited number of annulment grounds, annulment proceedings have a far more limited scope than regular appeal proceedings. This means that, unlike in regular appeal proceedings, the initial dispute between the parties is no longer subject to consideration in the annulment proceedings. In annulment proceedings it is therefore justifiable for the original claim in the arbitration to be disregarded when determining the amount of court fees payable.
No consistency amongst Dutch courts so far
The Court of Appeal's decision provides a useful guideline as to the court fees that should be charged in annulment proceedings, particularly considering the previous inconsistency in the approach taken by court clerks in this regard.
Our own analysis of all published annulment decisions in 2022 shows that in 40% of the annulment proceedings a court fee was charged for the amount applicable to non-monetary claims (i.e. in line with the decision of the Court of Appeal), whereas in the other 60% of the cases the amount of court fees was based on a certain value of the claim (i.e. the amount that had been claimed in the arbitration).
We expect the Court of Appeal's decision to prompt more and more court clerks to qualify an application for annulment as non-monetary and consequently to charge the lowest court fee of only EUR 783. Parties to Dutch annulment proceedings who are charged a higher amount of court fees may likely successfully challenge that amount by referring to the Court of Appeal's decision.
No recovery of court fees paid in excess
Parties who have been involved in annulment proceedings in the past may wonder whether they paid too high amounts of court fees, and if so, whether any excess payment of court fees could still be recovered. Unfortunately, we consider such recovery to be difficult, if not impossible. Article 29 of the Court Fees Act stipulates that a party must challenge the amount of court fees within one month of the court fee being paid. If no challenge is made within that timeframe, it seems no longer possible to request reimbursement of the court fees paid in excess.
Possible consequences for enforcement proceedings
Although the Court of Appeal's decision only related to the amount of court fees payable in annulment proceedings, it may also have relevance to applications seeking the recognition and enforcement of arbitral awards. The Court of Appeal's decision provides a sound basis to argue that – similar to annulment proceedings – applications for the recognition and enforcement of an arbitral award should be regarded as non-monetary and therefore subject to the fixed flat rate court fee. Indeed, our own analysis of all published recognition and enforcement decisions in 2021 and 2022 shows that the applications in question were already regarded as non-monetary in 92% of these cases. Should a party seeking recognition and enforcement of an arbitral award nonetheless be charged a pro-rata court fee based on the initial claim in the arbitration, it seems worthwhile to challenge the amount of the court fees and to refer to the Court of Appeal's judgment to argue that such applications should also be considered non-monetary.
