What is Construction Contract?

Dutch law treats the construction contract as a distinct type of agreement, alongside sale and the contract for services. The distinction matters in practice. In a sale you receive something that already exists or is supplied as standard. Under a services contract, such as consultancy, the provider promises best efforts. In a construction contract something is made, on your site or to your specification, and the contractor is only done when the work is standing. A supplier delivering and connecting a standard machine is closer to a sale; an installer designing and fitting a bespoke refrigeration system is doing construction work. Which rules apply depends on which element dominates.

The price can be agreed in three ways. A fixed contract sum gives the most certainty. Under a cost-plus or time-and-materials arrangement you pay for the hours and materials actually used. An estimated price sits in between: it is a forecast, but the contractor must warn you as soon as it becomes clear the estimate will be exceeded by more than ten percent. If no price was agreed at all, a reasonable price is owed, and what counts as reasonable is usually argued about afterwards.

Extra work is where most disputes start. Under article 7:755 of the Dutch Civil Code a contractor may only charge more for additional work if it warned the client in time that the price would rise, unless the client should have understood that anyway. A written instruction with a price agreed upfront keeps the discussion from surfacing for the first time on the final invoice.

The contractor also has a duty to warn. If it spots errors in the drawings, the specification, or materials the client has prescribed, it must point them out (article 7:754). If it stays silent, it can be liable for the resulting damage even though the original mistake was not its own.

Handover closes the build and opens a new phase. Once the work is approved, the contractor is in principle no longer liable for defects the client could reasonably have spotted at that point. Since the Quality Assurance for Construction Act took effect in 2024, the contractor is liable for defects that only come to light after handover unless they cannot be attributed to it. A careful handover report remains the single most important document in the project.

Finally, the client can terminate a construction contract at any time (article 7:764). That is not a free exit: the client pays the contract sum minus whatever the contractor saves by not completing the work. On larger projects the statutory rules are usually supplemented by the UAV 2012 standard conditions; on smaller jobs for SMEs there is often nothing more on paper than a quote and the contractor's general terms.

For many SMEs a renovation or new premises is the largest contract in years, and the one most likely to end in disagreement. Loio (2026) reports that 64 percent of civil lawsuits in the United States involve contract disputes. In construction such disputes rarely concern the big picture. They are about the details: who approved the extra work, when the job was really finished, and whether a defect was already visible at handover.

Those questions can only be answered if agreements and changes were recorded during the project. An email saying "go ahead and add that" can count as an instruction for extra work even if no price was ever mentioned. Clients who keep every change, every warning from the contractor and the handover report with the contract are in a strong position when things get tense.