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Anticipatory Breach under Dutch Caribbean Law

Depending on the specifics of the contract, a breach can occur when a party does not perform at all or does not perform in accordance with the terms of the contract or fails to perform on time. Under Dutch Caribbean Law, a breach of contract can also occur if it becomes clear that a party to the contract will not perform or not perform adequately. In this situation, whereby a party anticipates a breach of the contract by the other party, the party may request adequate assurances that the other party will perform its contractual obligations.

In case of a contract for the delivery of goods for example, if the supplier learns that the buyer has suffered significant losses and is in financial distress, this may give reasonable cause to doubt the buyer’s ability to (timely) pay once the goods are delivered. The supplier would have the right to demand adequate assurances that payment under the contract will be performed. If the buyer fails to provide these assurances, then the supplier could treat the contract as breached. Such an anticipatory breach has similar legal consequences, including available remedial options, as a ‘regular’ breach.