A clause often used in M&A and other contracts is that the contract must be interpreted by the wording, and by not the intent. In the Netherlands, contracts not containing such clause are not only interpreted by the text but also by the (reasonable) intent the parties can expound from the text. This general rule is also known as the Haviltex-rule. It has become customary in Dutch contracts – and especially M&A documentation – to contractually exclude such Haviltex-interpretation. As a result of which exclusion, the mere text of the contract becomes increasingly significant. At the cost of the intent, in the event the intent diverges from the text.
The question arises whether such exclusion has indeed the intended effect. A recent judgment of the Dutch Supreme Court indicates that such exclusion works. This means in practice that when you discover that M&A- or other documentation has excluded “Haviltex” – for instance by declaring that the mere text is relevant and/or supersedes the intentions – you should certainly take some extra time to read the contract before signing it. Please note that the judgment of the Supreme Court did not concern a M&A dispute. Since M&A documentation is usually subject to very intense negotiations and legal review (perhaps even more so than the case judged by the Supreme Court) it is to be expected that the pillar of this Supreme Court judgment shall not easily be overturned in future M&A-cases.