In the Netherlands, practitioners of independent professions tend to work together. They do so in partnerships with fellow practitioners. Independent professionals include accountants, lawyers, tax lawyers or tax advisers, notaries, architects, specialists (doctors), patent attorneys and pharmacists.
Traditionally, these professionals work together in a partnership (in Dutch: the maatschap). However, instead of the partnership (which in the original intent of the legislator was intended for the practice of a profession), independent professionals increasingly use a Dutch B.V. or N.V. (which in the original intent of the legislator was precisely intended for the practice of a business) when practicing their profession. This choice may have consequences for the termination of the cooperation.
Types of contractual relationships
In addition to the corporate law relationship that the independent practitioner has with the company (whether or not through his own practice company), there is usually also a relationship under contract law with that company (or a subsidiary thereof). This contractual relationship can often be characterized as an assignment contract. In practice, such an agreement can be called a management agreement, a partnership agreement, an affiliation agreement or a shareholders agreement. Other names also occur.
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The termination of a professional collaboration
If a professional no longer functions properly, there is the possibility for the other professionals to end the cooperation with their partner. This is often a drastic decision, both for the partnership and for the professional in question. Conversely, a situation can arise in which it is made practically impossible for an individual professional to continue working in the partnership. The relationship may become permanently disrupted, so that fruitful cooperation is no longer possible, or hardly possible. In such cases, termination and/or dissolution of the agreement come into the picture.
Dissolving a contract on the basis of a shortcoming
To be able to dissolve the contract, there must in principle be a sufficiently serious breach. An incidental or futile error does not automatically constitute grounds for dissolution. Furthermore, the dissolving party must in principle issue a notice of default. This is a written demand whereby the other party is given a second (and last) chance to perform properly within a reasonable amount of time. Dissolution may be accompanied by additional compensation. This might include compensation for lost income up to the retirement age.
The requirements that justify immediate termination of an agreement
With a termination other requirements usually have to be taken into account. One example is a notice period. The latter, however, will not apply if the conduct of the other party involves circumstances of such gravity that the terminating party can no longer be required to continue the relationship with the partnership. These are then so-called ‘important reasons’ (in Dutch: gewichtige redenen) that justify immediate termination. In such cases, the notice period may be set aside. A breach of trust can entail such important reasons and, therefore, justify immediate termination.
VIOTTA supports you in the termination of a professional collaboration
If you would like advice on an obstructive partner or shareholder, or if you are a shareholder or partner in a partnership and they make it impossible for you to practice or even try to kick you out, please contact VIOTTA Advocaten. We have many years of experience in assisting many professionals in difficult situations. When the situation calls for it, we assist clients in legal proceedings or arbitrations, but we also litigate before disciplinary tribunals. Please contact Arnoud Fioole or Martijn Kesler for questions or advice without any obligation.
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VIOTTA is a law firm based in Amsterdam, specialising in providing advice in the areas of corporate law, mergers and acquisitions, contract law and corporate & commercial dispute resolution. We advise in transactional matters and litigate in commercial disputes. VIOTTA provides legal advice to its clients on Dutch corporate law matters, such as corporate governance, board structures, directors’ duties and liabilities, joint ventures and other collaborations. VIOTTA advises purchasers, sellers, management and other stakeholders in domestic and cross-border mergers and acquisitions (M&A).