Although the law does not require advance notice in all cases, it is essential for your legal burden of proof and position to do so. Always do this in writing (e-mail or registered mail) and clearly explain on the basis of what shortcoming you are proceeding to suspend. This will prevent you from being unfairly accused of failing to fulfill your agreements.
What is the right of suspension?
The right of suspension is a legal right in the Civil Code. It allows you to temporarily not fulfill your own obligation as long as the other party fails to fulfill its agreement.
Important to know:
- You do not terminate the agreement, but you temporarily pause your obligation.
- You often use suspension to put pressure on the other party.
- In practice, you see this a lot with unpaid invoices or complaints about the quality of a delivery or service.
We often see this as a defense in debt collection cases: a debtor does not pay an invoice and says he is allowed to suspend due to alleged defects. We then always first test whether that appeal to suspension is legally correct.
When are you allowed to suspend?
You may not simply withhold payment or stop work. Suspension is allowed only if all of the following conditions are met.
1. The other party is really failing
There must be a clear deficiency. Consider:
- A delivery that is not complete
- A service not performed as agreed upon
- An agreed payment that fails to materialize
That obligation must also be due and payable: the agreed deadline has passed, or the performance should have already been delivered.
2. There is sufficient consistency between commitments
The obligations must be related. You may not suspend a payment because of a conflict from another, separate agreement.
Example: you cannot withhold an invoice for a recent job because you are dissatisfied with a project from a year ago, if these were separate agreements.
3. Your suspension must be proportional
Your response must be proportionate to the deficiency. Withholding a high bill entirely because of a minor defect is usually not allowed.
Smarter is then to:
- Only the disputed portion temporarily not payable
- Giving the other party a reasonable time to remedy the defect
Do you doubt whether you meet these conditions? Then contact us first before suspending yourself. Sometimes a firm final demand or starting a collection process immediately is a better route.
Suspension in practice
In daily practice, you encounter suspension in many ways. Some recognizable examples:
- A contractor stops construction because an installment invoice is not paid.
- A webshop delivers only after the customer has paid in advance.
- A service provider pauses a process because important input or documents from the client are missing.
In situations like this, suspension may be justified, but only if:
- The other party is truly at fault, and
- The measure is not more onerous than necessary
Is it about a customer who fails to pay an invoice and raises all sorts of complaints? Then we always carefully check whether there is really something wrong with the delivery or service, or whether it is mainly a way to delay payment.
When in doubt, we can help you build the file properly, with clear payment reminders, a legally valid WIK letter and a strongly supported collection order.
The risks of unwarranted suspension
Suspension is a powerful tool, but also risky. If you suspend wrongly, you yourself may be the party in trouble.
Possible consequences of wrongful suspension include:
- You get into debtor default yourself
- You become liable for delay damages from the other party
- The other party may rescind the contract and seek damages
- You are weaker in legal proceedings
Therefore, it is important that you always record suspension properly. Consider:
- Written and clear reasons why you are suspending
- Specifically state what the other party must do to lift the suspension
- Keep all communications in case it comes to litigation
We can help you draft a firm but neat letter so that your position is as strong as possible if it does come to litigation and court fees.
If your customer invokes suspension rights
In many collection cases, we see debtors use the right of suspension as a delaying tactic. A complaint or dispute is then raised even though the performance was actually well delivered.
Our approach in such situations:
- Testing the complaint: Is there really a defect, or is the complaint late or unfounded?
- Enforce payment of the undisputed portion: Even if there is a dispute, the undisputed portion simply remains due.
- Building legal pressure: We point out legal payment terms, dunning fees, collection costs and legal interest.
Thus, we reduce the right of suspension to what it really is: a temporary and limited remedy, not a license not to pay.
Want us to look in on a customer who has been "suspending" for months? You can submit your collection online. We will review the defense and completely take over communication with your customer for you.
Suspension rights in your terms and conditions
You can reduce the risk of abuse of suspension by making clear agreements about this in your contracts and general terms and conditions.
In brief:
- B2B (business-to-business): Between businesses, you may usually limit or even exclude the right of suspension.
- B2C (business - consumer): With consumers, this is much stricter. A complete exclusion of suspension is quickly seen as unreasonably onerous.
Practical Tips:
- Record that the customer must always pay the undisputed portion.
- Make clear the deadline by which a complaint must be reported.
- Refer to a clear roadmap for complaint handling.
Do you not yet have up-to-date terms and conditions or do you doubt whether your clauses on suspension and set-off are legally strong? If so, we can put you in touch with our legal partners or think along with you about what is customary in your industry.
Difference between suspension and offset
Suspension and offset are often mixed up, but they are two different means with their own rules and risks.
Suspension:
- You temporarily refuse to perform (e.g., pay or deliver).
- The agreement remains in place, you just put the performance on pause.
- You mainly use this to put pressure on the other party.
Settlement:
- You offset two claims against each other.
- After settlement, only any residual amount remains.
- Settlement often has more definitive consequences than suspension.
In your situation, the difference may be significant. Sometimes it is smarter to clearly substantiate and set off a counterclaim, sometimes suspending is tactically stronger. Especially if the relationship with your client is important, a good strategy is important.
We are happy to help you decide which route is best for your case: first an amicable debt collection process, or immediately proceed towards legal proceedings if necessary.
In doubt about whether you may suspend? Let us review your case.
Are you about to withhold payment or halt your operations? Or conversely, do you have a client who has been "suspending" and not paying for months? We would be happy to look at the agreements, complaints and your position with you.
You will receive honest advice: to suspend or not to suspend, and if necessary, we will immediately initiate collection proceedings or proceedings for you.
Frequently asked questions about the right of suspension
No, that is often one of the biggest pitfalls: proportionality. The law states that the suspension must be in reasonable proportion to the deficiency. For a minor defect, you are generally only allowed to withhold a portion of the payment equal to the cost of correcting the defect. Completely stopping a large payment for a detail is often seen as unlawful by judges.
Yes, this is called the “uncertainty exception. If you have a well-founded fear that the other party will not fulfill its part of the agreement – for example, due to strong signs of impending bankruptcy – you may suspend your own performance. It is advisable to seek legal advice on this immediately to test whether your grounds are strong enough.
In a business relationship (B2B), it is common and permissible to contractually exclude or limit the right to defer or offset. This prevents customers from using your payment as a “hostage” in minor disputes. Toward consumers (B2C), however, this is much trickier; excluding suspension in the case of individuals is often considered unreasonably onerous and may be declared invalid by the courts.
If you wrongfully suspend, you yourself fall into “debtor default. This means that you are the one breaking the law, allowing the other party to rescind the contract and claim damages from you for the delay you caused. You also immediately lose your strong position in any legal proceedings.
