You may sometimes temporarily suspend work or payment if your business counterparty fails to perform its obligations. To do so, factors such as the counterclaim, the connection between the obligations and the extent of the suspension must be assessed. Payment arrears do not give an unlimited right to halt a project or cut off access to systems.
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Written by Onur Arslan, attorney at Arslan Advocaten. Registered in the Netherlands Bar’s register of practice areas for employment law and personal injury. Last updated: 17 September 2026.
Suspension can be a useful means of obtaining performance. However, it can also increase the loss and provoke a counterclaim. Particularly with ongoing services, construction projects and business-critical software, careful consideration is needed before you interrupt performance.
This explanation concerns business agreements. Additional or different rules may apply to employment, consumer sales, tenancy and other special contracts. First establish which agreement you have and exactly which obligation you want to withhold.
What is suspension?
Suspension means that you temporarily do not perform an obligation of your own because it is matched by a legally relevant breach or claim on the other side. In principle, the contract remains in force. As soon as the ground for suspension ceases to exist, you may have to perform your obligation again.
This differs from rescission, by which an agreement is terminated in whole or in part and obligations to undo performance may arise. It also differs from set-off, whereby mutual claims may be extinguished up to the amount they have in common. Do not use these terms interchangeably in a letter.
A sentence such as “we are stopping the cooperation until you pay” may be unclear. Do you mean a temporary interruption of work, termination by notice or definitive rescission? Name the legal step and the intended consequence. An unclear notice may later give rise to a dispute about who actually ended the cooperation.
The general rule of Article 6:52 of the Dutch Civil Code
Article 6:52 of the Dutch Civil Code (BW) gives a debtor, subject to conditions, the power to suspend his performance where he has an enforceable claim against his creditor. There must be sufficient connection between the two obligations to justify the suspension. That connection may arise, for example, from the same legal relationship or from regular business dealings.
This does not mean that any invoice from the same client will do. The nature of the engagements, the link between payments and performance, and the contractual arrangements all play a part. An old dispute from a separate project does not automatically justify halting a new urgent assignment.
The identity of the parties is also important. A claim against the holding company does not in itself give a right of suspension against the operating company. Economically the group may have a single owner, but legally the companies may be different contracting parties.
Reciprocal agreements and proportionality
For reciprocal agreements, Article 6:262 of the Dutch Civil Code contains a specific rule. If one party fails to perform its obligation, the other party may suspend its corresponding obligation. In the case of partial or defective performance, this is only permitted to the extent that the breach justifies the suspension.
A minor point requiring remedy in an assignment that has largely been performed correctly therefore does not automatically justify withholding the entire price. Conversely, a defect that renders the entire performance unusable may support a broader suspension. Simply comparing the percentage of the costs is not always enough; the function and seriousness of the problem also count.
Make a reasoned assessment. What is missing, which interest is affected by it, and why are you withholding precisely this amount or this performance? A choice that is explained in concrete terms is easier to defend than a statement that all payments are frozen for the time being.
Must the other party first be in default?
A notice of default and default itself are not required for every reliance on suspension. Suspension has different requirements from a damages claim or rescission for a breach that can still be remedied. Nevertheless, it is often sensible to report the breach in writing and to request performance in concrete terms.
If you want to combine different remedies, the requirements for each remedy must be met separately. A valid suspension does not prove that you can also claim damages straight away or rescind the entire agreement. Do not, therefore, thoughtlessly list a series of legal terms in a letter.
If an invoice is not yet due, suspension because of expected future problems calls for a different analysis. In reciprocal agreements, Article 6:263 of the Dutch Civil Code may offer protection where, after the contract was concluded, there are good grounds to fear that the other party will not perform. A rumour or general distrust is not in itself sufficient for this.
What does your contract say?
Business agreements may contain provisions on suspension, remedy periods, prior notice and security. Some terms restrict the client’s right of suspension. Others give a supplier the right to interrupt services temporarily in defined circumstances.
First check whether those terms actually form part of the agreement. A reference on an invoice that was only sent after acceptance is not automatically sufficient. There may also be a dispute about conflicting general terms and conditions. The explanation on general terms and conditions for self-employed professionals and SMEs helps you assess that preliminary question.
Nor is an agreed clause applicable without limit in every situation. The interpretation of the clause and reasonableness and fairness, among other things, may play a role. Do not rely on a standard clause without considering the consequences of the specific interruption.
Suspending work because your client does not pay
Check the invoice, due date, payments received and any objections. Then ask yourself which future work corresponds to the overdue payment. A contractor who has not yet received a disputed advance payment is in a different position from someone who blocks a component that has already been paid for in order to win a separate dispute.
A notice may state which work will be withheld from which date, which amount is due and how the client can bring the suspension to an end. Take into account arrangements on notice and a reasonable practical transition. A very short period is not always defensible when the consequences are significant.
Work out a scenario for resumption. Who will reschedule the work, what information is needed and what delay is unavoidable? This prevents a temporary suspension from tacitly becoming a definitive termination. If the client raises a substantive defence, also read disputed invoice.
Suspending payment because the supplier falls short
First describe the agreed performance and the specific defect. Record when the problem was reported and what the supplier replied. In a technical dispute, photographs, measurement reports, error messages and an independent investigation may be needed.
Determine which part of the payment you are withholding and why. It may be appropriate to pay the undisputed part and set aside a reasoned amount. This does not avoid every legal risk, but it does make clear that your response is linked to the specific problem.
Allow remedy where that is reasonable and legally appropriate. If you deny the supplier access while continuing to suspend payment because the defect has not been remedied, you may weaken your own position. Document access arrangements and practical preconditions accordingly.
Software and digital services require extra care
Shutting down a business-critical application may have more consequences than postponing an ordinary delivery. Think of patient data, payroll, payments or customer orders. Investigate contractual powers, access to your own data, security, continuity and the possibility of a less drastic measure.
A supplier does not automatically have a right of retention over digital files because it has carried out work. The legal characterisation of data and the agreed access must be examined separately. Privacy and security obligations also do not disappear because an invoice is outstanding.
Distinguish, for example, between not starting new development and cutting off access that has already been paid for. In an acute security matter, other interests may outweigh the ordinary payment dispute. Record the balancing exercise you carried out and have a drastic block assessed in advance.
Safety and mitigation of loss remain important
A work stoppage on a construction site must not lead to a dangerous situation without due consideration. Vulnerable goods, perishable stock and ongoing security may also call for measures. Determine which minimum actions are needed to limit foreseeable loss.
This does not mean that you must keep working for free indefinitely. It means that the suspension you choose must be assessed in its context. A reasonable protective measure may be something other than completing the entire assignment. Record the costs, responsibilities and the reason for the measure in writing.
Also inform the employees or subcontractors involved about what they may and may not do. A field employee who takes back keys or wipes a server on his own initiative can still undermine the carefully chosen position. Restrict access to those who carry out the decisions.
Security can be an alternative
Sometimes a bank guarantee, escrow deposit or other appropriate security can resolve the problem for the time being. Article 6:55 of the Dutch Civil Code may be relevant here. The security offered must match the risk and the claim for which performance is being suspended. Not every non-binding offer is sufficient.
Discuss the amount, the duration, the conditions for payment and the costs. A guarantee that expires before the dispute can be resolved may offer insufficient protection. Demanding unconditional payment while appropriate security is available may likewise call for further consideration.
A temporary arrangement must make clear whether the parties retain their legal positions. Record, for example, that resumption does not mean that a complaint or counterclaim is abandoned. Do not use an escrow deposit without arrangements on its management and release.
Sample suspension letter
This example assumes that, after assessment, a right of suspension exists. Adapt the text to the agreement, the performance and any mandatory notice periods.
Subject: temporary suspension of [work or payment]
Under our agreement of [date], you are obliged to [obligation]. On [date] we established that [specific failure to perform]. We reported this to you on [date]. The relevant documents are enclosed.
With effect from [date], we are withholding only [precisely described performance or amount]. This suspension is connected with [explanation of the connection] and in our assessment is justified by [seriousness and extent]. We will continue to perform our arrangements in respect of [undisputed component].
We request that you bring about [specific performance or remedy] and contact us about this by [date] at the latest. Insofar as appropriate security can remove the ground for suspension, we are willing to discuss a sufficiently detailed proposal. Once the ground for suspension has ceased to exist, we will coordinate the resumption with you.
This letter serves as a temporary suspension and is not a termination or rescission of the agreement. We reserve all our other rights. The practical measures to prevent loss or unsafe situations are [description].
Fictitious example of an overly broad work stoppage
An installation company has a maintenance contract and, in addition, a separate assignment for an extension. There is a dispute about part of the additional work. The company is considering stopping all maintenance work, including a necessary safety inspection that has already been paid for.
The first question is not how much pressure this creates, but whether the obligations are sufficiently connected and whether the proposed interruption is justified. The contract, the seriousness of the payment dispute and the safety consequences must also be considered. A limited measure relating to the disputed extension assignment may be legally different from halting every service.
After assessment, the company may opt for a payment request, a targeted suspension or security. The example does not give a general outcome for maintenance contracts. It shows why an all-or-nothing response is risky.
What if the other party suspends wrongly?
Ask for a specific explanation of the legal basis, the counterclaim and the extent. Respond on the merits and, where appropriate, offer remedy or security. A bare denial is of little help if there actually is a breach.
If the suspension is unjustified, performance can be claimed. If the matter is sufficiently urgent, interim relief proceedings (kort geding) may be considered, for example when operations are seriously affected. The court will look at, among other things, the plausibility of the claim, the interests involved and the risks of a provisional measure.
Damages require a separate assessment of breach, attribution, causation and the extent of the loss. Keep records, therefore, of downtime, replacement measures and costs avoided. A high loss of turnover is not automatically the same as recoverable loss.
Have the measure reviewed in advance
With corporate law assistance for businesses, it can be assessed whether suspension fits your objective and which letter should accompany it. Send the contract, the terms and conditions, invoices and the relevant correspondence. Also state which work or systems are affected and why the matter is urgent.
A short assessment before the work stoppage can prevent you from ending up in breach yourself. The aim is a workable measure with which you promote performance and keep the loss under control.
Agree the resumption in advance as well
A suspension file is only complete when it is clear what happens after payment or remedy. A client who does eventually pay may expect the work to continue that same afternoon. Your staff may by then have been scheduled elsewhere. Discuss, therefore, what a reasonable resumption involves and prevent a justified temporary interruption from turning into a new delay for which you yourself are responsible.
Record the status of the work on the date of interruption. Which components are finished, which materials are ready and what work is needed to restart safely? For technical projects, draw up a joint report if necessary. This helps to distinguish later damage from problems that already existed before the suspension.
Check who bears the costs of downtime, storage and restarting. Such costs are not automatically fully recoverable. The agreement, the ground for the suspension and the reasonableness of the expenses incurred are relevant. Where possible, budget for them in advance and warn of foreseeable consequences.
If the other party performs only in part, reassess which part of the suspension is still justified. A measure that was originally well founded need not continue to the same extent. Record every adjustment with its date and reason, so that your project team also knows which obligations are being performed again.
Frequently asked questions
May I always stop if one invoice has not been paid?
No. Investigate whether the claim is due, the connection, the contractual arrangements and the consequences of your measure. An unpaid invoice from a different legal relationship does not automatically give you a right to stop all work for the same group of companies.
Do I first have to send a notice of default?
For suspension, this is not required in all cases. For other steps, such as certain damages claims or rescission, default may be necessary. A clear written notification usually remains sensible and may be required by the contract.
May I withhold the whole invoice for a minor defect?
Not automatically. In the case of partial or defective performance, the extent of the suspension must be justified. Assess the seriousness, function and remediability of the defect and give reasons for the amount you are temporarily not paying.
Does suspension end the contract?
In principle, no. It is a temporary interruption of an obligation. Termination by notice, rescission and termination by mutual consent have different requirements and consequences. Make clear in your letter which step you are taking.
Can a bank guarantee end the suspension?
Appropriate security can remove the ground for suspension. That depends on the claim, the statutory rules and the content of the security. Check the amount, duration and conditions before you accept or reject a guarantee.
Can I obtain damages after a wrongful block?
In certain circumstances, yes. You must substantiate, among other things, the unlawfulness or breach, the loss and the causal link between them. Contractual limitations and your own measures to mitigate the loss may affect the outcome.
Read also
Sources and legal basis
- Dutch Civil Code, Book 6: Articles 52–57, 74, 81–83, 248, 262 and 263.
- Dutch Code of Civil Procedure (Rv): Article 254 on interim relief proceedings.
