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Settling claims after unilateral withdrawal from a contractor agreement

19.03.2019

In a decision on September 26, 2018 (file no. 32 Cdo 1340/2018), the Czech Supreme Court considered how to resolve the competing rights of the parties to a contractor agreement after the withdrawal of one party. In the case at hand, the contractor’s claim concerned improvements it had made to a property which had increased that property’s value and enriched the other party.

The court concluded that when calculating one party’s enrichment, the total sum should not include any increase in property value caused by factors outside the contractor’s work. Examples of those factors include the passage of time and related changes to the real estate market.