Damage in international disputes is the financial compensation for damage caused by breach of contract or tort. At Musch Legal, we perform damage calculations daily for clients in international disputes. Three main questions: which law determines the extent of damage, which items are reimbursable, and how is damage proven? Unfamiliarity with international rules on damages (foreseeability, mitigation) often leads to an undervaluation of the claim.
What is the legal problem? (What damages can you claim?)
Damage has limitations per legal system: foreseeability, causality, reasonableness, and the duty to mitigate. Under Dutch law, Article 6:98 BW: attribution; Article 6:101 BW: contributory negligence; Article 6:102 BW: mitigation. Under CISG Article 74: principle of foreseeability. Under English law: Hadley v Baxendale (1854): natural consequence + foreseeable specials. Differences can lead to divergent outcomes amounting to tens of thousands of euros.
What does the law say? (Which frameworks determine the extent of damages?)
Under Dutch law, Articles 6:95-6:106 of the Civil Code. Article 6:95: pecuniary loss + other disadvantage. Article 6:96: reasonable collection costs. Article 6:97: assessment of damages in the manner that most corresponds to their nature. Article 6:101: contributory negligence; Article 6:102: mitigation. Under Article 74 of the CISG: damages up to the amount that the party foresaw or ought to have foreseen at the time of concluding the contract. Under common law Hadley v Baxendale test.
For interest calculation, Article 6:119a of the Dutch Civil Code applies to commercial interest (8% above the ECB rate in 2026).
State of damage
Dutch law
CISG
English law
Actual damage
Fully compensable
Article 74 if foreseeable
First limb Hadley
Lost profits
Compensable provided causal
Article 74 foreseeable
Second limb if foreseeable
Indirect damage
Compensable provided causal
Foreseeable
Restrictive
Punitive damages
Do not exist
Do not exist
Limited (tort only)
Statutory interest
8% above ECB (art 6:119a)
No specific
Variable
State of damage
Dutch law
CISG
English law
Actual damage
Fully compensable
Article 74 if foreseeable
First limb Hadley
Lost profits
Compensable provided causal
Article 74 foreseeable
Second limb if foreseeable
Indirect damage
Compensable provided causal
Foreseeable
Restrictive
Punitive damages
Do not exist
Do not exist
Limited (tort only)
Statutory interest
8% above ECB (Art. 6:119a)
No specific
Variable
What risks do companies face? (What threatens with incorrect handling of damages?)
Undervaluation of claim due to lack of evidence of damage. Duty to mitigate under Article 6:101 of the Dutch Civil Code can reduce compensation (contributory negligence). Unfamiliarity with the principle of foreseeability limits compensation under CISG and common law. Unintended liability for lost profits to the counterparty in the event of a loss. Incorrect interest calculation under Article 6:119a of the Dutch Civil Code. For large claims: expert report required for substantiation.
Practical example from our practice (How did we recover 2.1 million euros?)
Musch Legal represented a Dutch supplier whose software failure caused a week of downtime for a British client. The client claimed 5 million euros in lost profits. We conducted a defense: the exclusion of indirect damage was maintained under the general terms and conditions; for direct damages, Hadley v Baxendale first limb damages were limited to 750,000 euros (repair costs + immediate loss of work). Conversely, in a similar case for a Dutch client, we won 2.1 million euros in compensation via a detailed damage calculation with an expert.
What can you do? (How do you maximize your damage claim?)
Document damages by category: direct costs, lost profits, loss of revenue, mitigation costs. Align damage claim with applicable law and foreseeability. Limit own mitigation risk under Section 6:101 of the Dutch Civil Code. For substantial damage: expert report (accountant, industry expert). Claim commercial interest under Section 6:119a of the Dutch Civil Code (8% above ECB). For defense: conversely, substantiate why the claim is disproportionate. Engage Musch Legal for damage calculation.
International contractual damages