DJ Paul van Dyk fell off a stage during a performance in Utrecht in 2016. He suffered severe brain and spinal injuries. He later successfully initiated an arbitration procedure against the event organiser. The tribunal awarded compensation to the value of $12.6 million. however, the organiser believed this amount to be excessive and refused to pay. The Supreme Court had to rule on the case.
The arbitration took place under the ICDR Rules in California, USA. During the proceedings, Paul van Dyk argued that the organiser had violated the “booking agreement” agreed between them by creating an unsafe workplace. The accident occurred after the DJ stood on a table to whip up the crowd and fell 10 metres into an uncovered hole.
The arbitration board ruled that the organiser was negligent by not taking measures to prevent the accident, and this established liability. In addition to a financial loss of $5.7 million. (consisting of lost income and costs for medical treatment in a Dutch and Berlin hospital) the arbitrator also ordered the organiser to pay an amount of $5.5 million for immaterial damage.
The organiser refused to pay, and Paul van Dyk wanted to recover what he was owed from the arbitration verdict using the organiser’s
The assets of a Dutch company reflect the value of all that the company possesses
» Meer over assets assets in the Netherlands, so he applied to the Dutch court for leave for enforcement, initially at the Amsterdam Court of Appeal and then at the Supreme Court.
The Dutch organiser argued during the proceedings that the arbitration verdict was, among other things, contrary to public order because, according to her, the immaterial compensation awarded amounts to compensate for “punitive damages”, which is excessive by Dutch standards.
In this context, the organiser argued that only damage actually suffered is eligible for compensation in the Netherlands and other European countries. Compensation far in excess of the actual damage suffered is overcompensation, which is prohibited.
It is true that compensation for immaterial damage is awarded in very few cases in the Netherlands. Moreover, the amounts awarded are low in absolute terms. The highest amount ever awarded for immaterial damage in the Netherlands is €250,000 (for an innocent victim of a shooting who was completely paralysed).
It is also true that Dutch liability law – unlike in the United States – does not recognise “punitive damages” (i.e. compensation separate from the actual damage of a punitive nature). In fact, judgements in which “punitive damages” are awarded are usually – partially – not recognised by the lower Dutch courts.
Nevertheless, both the Court of Appeal and the Supreme Court made short shrift of the organiser’s argument. They believe the court should exercise restraint when assessing whether a foreign arbitration award is contrary to public order. This is only the case if fundamental principles have been violated
The Court of Appeal and the Supreme Court both came to the conclusion that the arbitrator provided an extensive explanation and described why, in this case, there was a basis for awarding the immaterial damages under applicable California law, and that the amount is in line with comparable cases covered by California law. The fact that the amount of compensation may seem very high for a Dutch person is insufficient to consider it contrary to public order.
Furthermore, the arbitrator explicitly explained that the compensation for immaterial damage was not punitive in nature. It was therefore established for the Dutch court that the nature of the compensation was compensatory (and therefore related to actual immaterial damage suffered).
What is special about immaterial damage is that compensation in money is an attempt to provide compensation for something that pre-eminently does not involve damage to the assets. In other words, any amount is too high and too low at the same time. In any case, Paul van Dyk worked through his experiences regarding the accident by writing and releasing a book (“Im Leben bleiben” [From now on]). Perhaps this has rectified some of the immaterial damage.
At AMS Advocaten Onno focuses on corporate and commercial litigation. He advises clients on various legal issues in the areas of company law, contract law and tort. Follow Onno on LinkedIn.