Liability for Agents in Czech Tort Law: A Step in the Right Direction? (Is there any Right Direction anyway?)

Vojtech Lovetinsky, Berlin/Prague

1. Introduction

Imagine a nurse who is employed at a hospital and asked by the hospital to assist an outside surgeon in the operating room of the hospital causes harm during the operation,[1] or a doorman of a nightclub is beaten up by guests, manages to flee, runs back to his nearby apartment and gets a knife, hurries back and pursues one of the guests, now fleeing, and severely injures him.[2] Is the surgeon or operator of the club liable for such injury?

As indicated by these cases, this article deals with liability for others, namely the liability of principals for torts caused by their agents. In respect of the concept of liability in the tort law of some European countries, under which the liability of the principal is based on its breach of a required standard of conduct (e.g. duty to supervise), the use of the common law term vicarious liability, which is strict, was avoided. In a similar way, the term agent is understood here in a wider sense and not only as an employee. Lastly, the article is restricted only to tortious liability, as contractual liability is mostly subject to special rules.

After the scenes have been played out and the torts committed, questions should be raised. What are the basic criteria for imposing liability on the principal for its agent? Is there any right concept of liability for agents to be followed? Is it a Czech concept? And does the liability of the principal mean that the agent is let off the hook?

2. Methodology and Structure of the Article

My comparative research leads to the conclusion that there are some basic subjects which are repeated constantly in almost each tort law jurisprudence. Hence, this article is divided according to these subjects. In each of these parts, I present a very short summary of the subject, especially from the point of view of the German Civil Code (the “BGB”) and the Austrian Civil Code (the “ABGB”) and two academic European unification projects: Principles of European Tort Law (the “PETL”) and the Draft Common Frame of Reference (the “DCFR”). All of these were also considered for the formation of the Czech concept.[3] Therefore, I also refer to them jointly as the “inspirational sources”.[4] Because of the limited length of this article, I only mention my own opinion on the matter, provided that I am not satisfied with the presented solution of any of these inspirational sources. In this way, I reach a certain ideal framework for evaluation of the Czech concept. Subsequently, the subject is presented within the Czech concept, including its assessment.

3. Principal and Agent

Understandably, the liability of the principal for the agent requires a definition of the principal and the agent. As indicated in the introduction, the inspirational sources opt for the wide concept of agent. They often call the agent a helper or auxiliary. The decisive criterion is the relationship between the agent and the principal, in which the principal is entitled to give the agent orders.[5] In other words, there must be a relationship of instructional dependence.[6] The same applies to the principal. It is irrelevant whether the principal is an employer or business person or a friend giving instructions. It only matters when the special relationship is given. So the liability of the outside surgeon in the case of the nurse mentioned in the introduction would depend on whether the nurse acted under his instructions during the operation. This means that an independent contractor cannot be considered as an agent. It would not be fair if the principal was liable for someone who is not integrated into his organisational structure and is in a much better position to insure the risk.[7]

In respect of the Czech concept, the first matter to be presented is the fact that there are two sections in the Czech Civil Code[8] (the “CC”) regulating liability for torts of agents. Section 2914 CC sets out a general rule: “A person who uses in his activity an agent, employee or another helper provides compensation for damage caused by such a person as if he caused it himself. If, in activity of another person, someone has undertaken to carry out a particular activity independently, he is not considered as a helper; however, if such other person has chosen him carelessly or exercised inadequate supervision over him, that other person is liable as a surety for the fulfilment of his duty to provide compensation for damage.” As regards the definition of the agent, this provision provides a wider concept of the Principal-Agent relationship. The term another helper corresponds to the term under the inspirational sources. This has already been accepted by the existing jurisprudence.[9]

A special rule is part of the regulation of legal persons. Under Section 167 CC “a legal person is liable for an unlawful act committed in the performance of his duties by a member of an elected body, employee or another representative against a third person.” Although there are doubts regarding the categorisation of the liability for representatives under the liability for others, in my opinion, it is at least practical to add this rule to see the whole context of potential liability. See also Art. VI. – 3:201 DCFR, which stipulates that accountability for damage caused by a person employed or engaged “applies correspondingly to a legal person in relation to a representative causing damage in the course of acting as such a representative. For the purposes of this paragraph, a representative is a person who is authorised to effect juridical acts on behalf of the legal person by its constitution.”

However, in my opinion, the scope of application of Section 167 CC is unnecessarily wide and overlaps with Section 2914 CC as regards the liability for employees and agents – representatives other than statutory bodies. If a legal person could be liable for its employee or agent under Section 2914 CC, there is no reason to impose also such liability under Section 167 CC. This may even cause some interpretation problems, e.g. if a legal person is liable for a representative who is an independent contractor acting for the legal person under a power of attorney[10] or if it is always liable for a representative who caused an unlawful act, but did not act negligently.[11] Hence, I would suggest applying the principles set out in Section 2914 CC similarly within Section 167 CC. This would also correspond to the principle of basically equal legal treatment between legal persons and individuals.[12]

Neither of the inspiration sources includes such a wide definition of a representative. The DCFR demands authorisation by the constitution of the legal person. The same applies to the German and Austrian concepts. Only the respective jurisprudence includes other representatives, but under the condition that the person has a leading position with certain organisational powers.[13] Moreover, within these concepts, the liability of the principal for the agent is based in principle on its fault, which is often considered unfair for the victim, and this is the reason why jurisprudence and case law imposed strict liability for leading representatives. However, as this article explains in part 5 below, the Czech concept in Section 2914 CC sets out strict liability, and therefore, there is no reason to extend the scope of liability of legal persons.

4. “In the Course of Employment”

Although its wording differs, a common requirement among the inspirational sources for imposing the principal’s liability is that the agent causes damage in the course of its employment or engagement.[14] For example, if an employee steals something from the employer’s client outside its working hours on the weekend, the employer is not liable.[15] However, a lot of cases are disputable and must be decided on a case-by-case basis. Even intentional damage or a criminal act could occur in the course of employment. In the case of the doorman mentioned in the introduction, it is held that the doorman is liable, because he was employed for the purpose of removing riotous guests, using force when necessary.[16]

The Czech concept in Section 2914 CC states only that the principal uses the helper “in his activity”. In my opinion the provision should explicitly mention that it is the helper who must act within the course of the employment or engagement. Although the provision could be formulated more precisely in this way, the jurisprudence is unified indicating that this requirement applies as well as in the inspirational sources.[17] On the contrary, Section 167 CC explicitly says that a representative must act “in the performance of his duties”. Again, we can see that the correlation between these provisions is not perfect.

5. Fault of the Principal

This matter is very controversial among the inspirational sources. Both European projects utilise the respondeat superior principle, i.e. fault of the principal is not relevant for its liability. It is sufficient if the act of the agent was wrongful and intentional or negligent. This requirement excludes, on the other hand, its categorisation as strict liability in the sense of liability for dangerous activities. Although the BGB sets out liability based on the (presumed) fault of the principal, case law and jurisprudence have found ways to bypass it and practically establish the respondeat superior principle.[18] The reason was basically that it was too easy for the principal to prove it obeyed the respective duty of care and the new possibilities to insure the risk by the principal, irrespective of whether or not it is an entrepreneur or a household.[19]

On the contrary, leading Austrian scholars argue that there is no sufficient theoretical basis to impose such strict liability when someone just simply entrusts a task to someone else. They provide examples from everyday life as if someone asks its child to go buy milk and it causes a traffic accident.[20] The response from strict liability advocates is that such cases do not fall within the scope of application of the respective provision because of a lack of a contractual or at least quasi-contractual relationship.[21]

In my opinion, the Austrian objection is relevant, but it should be handled as an exception to the rule. The world of modern entrepreneurs and technologies generally requires the respondeat superior principle because of the following reasons. Through delegation of tasks the principal basically always creates risk which does not correspond to the risk which would be created by particular agents themselves.[22] Imagine the risk based on the organisational structure of big holding companies. With this risk, the principal can also calculate and control it – at least it may insure it at the beginning.[23] Another reason to impose such strict liability is the preventive function of tort law. It is undisputable that strict liability requires from a reasonable principal with sufficient resources more preventive measures than from the agent itself[24] and also from a principal who is under the risk of liability based on its fault. With respect to the cases mentioned by Austrian jurisprudence, in which strict liability could be seen as unjust, I would suggest ad hoc mitigation of the amount to be compensated.[25] The requirement of a contractual or at least quasi-contractual relationship does not seem to me to be appropriate, because in some cases of everyday life, it could be complicated to prove that such a relationship was given.

It follows that the Czech concept is an ideal approach in this matter. Section 2914 CC as well as Section 167 CC imposes strict liability on the principal. The principal’s fault under Section 2914 CC is relevant only if someone undertakes to carry out a particular activity independently. In such a case, the principal is not liable directly, but as a surety. This is a really strange solution in comparison with the inspirational sources, and in my view, it has basically no practical consequences, because the principal could also be sued for compensation of the damage for breach of the duty of care under the basic tort law clause.[26] In respect of the cases of everyday life, in which the strict liability could be unfair, the Czech concept allows ad hoc mitigation under Section 2953 CC. One of the criteria the court should particularly take into account is how the damage occurred.

6. Unlawful Act and Fault of the Agent

European projects taking into account the respondeat superior principle require that the act of the agent not be only wrongful, but also intentional or negligent, or as stated by the DCRF, explicitly, if the agent is otherwise accountable for the damage. If the agent itself is not liable, the principal should not be either. Although disputed, the German concept also requires that the agent breaches the general duty of care.[27] Austrian law is an exception; the fault of the agent is not basically required. However, this is because of the special kind of Austrian concept, in which the relevant element is the unfit or dangerous quality of the agent which is attributable to the principal, irrespective of the agent’s fault.

Under the Czech concept, the principal is responsible for the act of its agent to the same extent as if it had acted alone. This results from the sentence […] provides compensation for the damage caused by such a person as if he caused it himself”[28] Hence, the lack of the agent’s fault exonerates it in principle from liability, but not the lack of the agent’s culpability, e.g. if the agent is not liable because it is a minor or an adult of unsound mind.[29] The same applies within the scope of Section 167 CC, although it is not explicitly mentioned in the wording of the provision. An exception is the case where the agent would be liable with respect to a tort law clause that does not require fault. As set out expressly in the DCFR, the principal in such a case is liable irrespective of the agent’s fault.

7. Duty to Compensate the Damage by the Agent and its Limitation

The last matter may be divided into two questions. Firstly, can the victim sue the agent alone? Secondly, if the victim sues the principal and it compensates the damage, does it have a contribution claim against the agent?

In respect of the first question, both the Austrian and German concept say yes. There is a claim concurrence, and the fact that an employee is protected against its employer should not have any effect on the victim.[30] However, in order to get damages from the agent, the victim must, of course, prove the agent is liable under any other tort law clause. The European projects do not deal with this matter in particular. Only the PETL commentary mentions it would prefer the liability of the auxiliary combined with the right of recourse against the employer in the case of slight (minor) or medium negligence.[31]

There is a dispute in this matter with respect to the Czech concept. The previous Czech concept did not explicitly allow suing the agent.[32] It was only liable towards the principal and, if it was an employee acting negligently, there was a limit of 4.5 times the average monthly gross salary imposed by the Labour Code.[33] However, Section 2914 CC is open to interpretation. Therefore, some scholars argue that there is the possibility of suing the agent, even if it is an employee.[34] In my opinion, this approach is correct. The employee is not protected more than the victim, if we consider it may be exonerated when proving that it did not act negligently and, moreover, if it has even the right of recourse against his employer in the case of its negligence. Further, the Labour Code, which is still effective today, should regulate only relationships between employers and employees. The same applies to liability for agents – employees under Section 167 CC.

As to the second question, German case law[35] and the Austrian Employees Liability Act[36] set out a limitation under which, in the case of minor negligence, the employee is exonerated towards its employer from liability to the full extent. In the case of gross negligence, it is basically not exonerated at all, and in the case of medium negligence, the amount of damages should be decided on a case-by-case basis. As mentioned above, the Czech Labour Code stipulates a limitation, according to which, if the damage was caused negligently, the employer’s contribution claim is limited to 4.5 times the average gross monthly salary, unless the employee acted intentionally or under the influence of alcohol or drugs.[37]

In respect of the question whether the statutory limited amount is better than the general limitation, I think it depends on a more general issue – how we trust our courts in these matters. However, from my point of view, the statutory limited amount is not a priori negative. As this article argues in part 5, the principal may calculate the respective risk and insure it.

8. Conclusion: Heading in the Right Direction

It follows from the aforementioned that an ideal concept of liability for agents should be based on the wide definition of agent. The decisive criterion presents only the relationship of instructional dependence between it and the principal. The principal should be only liable if the agent causes damage in the course of its engagement. It should be further based on the respondeat superior principle, i.e. the principal’s fault is irrelevant. If the strict liability could be seen as unjust in some cases, the court should have the right to ad hoc mitigate the damages. On the contrary, the unlawful act and fault of the agent should basically be a requirement for the principal’s liability. Hence, this liability does not correspond to liability for dangerous activities. As for the liability of the agent itself, it could be sued by the victim directly, but if it is an employee, it should have the right of recourse against its employer in the case of minor or medium negligence.

In principle, the Czech concept heads in this direction. However, the scope of liability of legal persons for representatives is too wide and overlaps with the general liability for agents (helpers) under Section 2914 CC. This may cause certain interpretation problems. Further, the requirement of causing damage in the course of the agent’s engagement must be set out in jurisprudence. This applies similarly to the direct liability of the employee towards the victim. On the other hand, all of the mentioned issues within the Czech concept may be solved by an appropriate interpretation. Thus, the Czech concept heads in the right direction, but should keep going.

Vojtech Lovetinsky graduated at Law Faculty of Charles University in Prague in 2014. He also studied at Faculty of Law of Free University of Berlin (Erasmus Programme 2012 – 2013). He works as Junior Associate in a law firm in Prague, Czech Republic, before that he worked as Junior Associate in a law firm in Berlin, Germany (2015 – 2016).

[1] See Galand-Carval, S. (2003). In: Spier, J. (ed.). Unification of Tort Law: Liability for Damage Caused by Others. Great Britain: Kluwer Law International, p. 5.

[2] See Von Bar, C. (2009). Principles of European Law. Study Group on a European Civil Code. Non-Contractual Liability Arising out of Damage Caused to Another. Munich: Sellier, p. 637 and Mattis v. Pollock [2003] EWCA Civ 887.

[3] The explanatory memorandum to the Czech Civil Code does not contain any persuasive answer regarding the inspirational sources in respect of the liability for agents. A general answer could be found in Eliáš, K. (2010). Návrh českého občanského zákoníku: Obrat paradigmat. Právní rádce, No. 1, pp. 4 – 13. “Hence, in respect of the regulation of liability for damage or unjust enrichment the concept is inspired not only by the PETL and DCFR project, but also by other models, e.g. the civil codes of the Netherlands, Germany, Switzerland, Italy, Spain, Quebec or the Austrian draft of tort law reform.” A comparative analysis in Czech tort law is indeed sometimes a hard puzzle to solve.

[4] In particular, Art. 6:102 PETL, Art. VI. – 3:201 DCFR, Section 831 BGB and Section 1315 ABGB. Under the term inspirational source, I also understand a regulation which the Czech legislator had to be aware of but did not accept, i.e. it was a certain negative inspiration.

[5] See Koziol, H. (1984). Österreichisches Haftpflichrecht. Band II. Besonderer Teil. 2th Ed. Wien: Manzsche Verlags- und Universitätsbuchhandlung, p. 353.

[6] Von Bar, C., op. cit., note 2, p. 634.

[7] See European Group on Tort Law (2005). Principles of European Tort Law, Text and Commentary. Wien: Springer Wien New York, p. 117.

[8] Zákon č. 89/2012 Sb., občanský zákoník.

[9] See Bezouška P. (2014). In: Hulmák, M. (ed.). Občanský zákoník VI. Závazkové právo. Zvláštní část. Praha: C. H. Beck, p. 1579.

[10] As for the relationship between the person with power of attorney and the agent, see Wagner, G. (2013). In: Habersack, M. (ed.). Münchener Kommentar zum Bürgerlichen Gesetzbuch. Band 5. Schuldrecht – Besonderer Teil III. 6th Ed. München: C. H. Beck, Section 831, no. 20.

[11] For this question, see part 6.

[12] See Bydlinsky, F. (2013). System und Prinzipien des Privatrechts. Wien: Verlag Österreich, pp. 142–145.

[13] See Section 31 BGB, BGH 30 Oct. 1967, BGHZ 49 p. 19 and Kötz, H. and Wagner, G. (2010). Deliktsrecht. 11th Ed. München: Verlag Franz Vahlen, pp. 121–122. For the ABGB, see Koziol, H. and Welser, R. (2006). Grundriss des bürgerlichen Rechts. Band I. 13th Ed. Wien: Manzsche Verlags- und Universitätsbuchhandlung, p. 74.

[14] So the DCFR. The PETL uses “within the scope of their functions“. BGB: “in Ausführung einer Verrichtung”. Section 1315 ABGB is somewhat special, because there must be a causal link between the lack of quality of the helper and the occurrence of the damage.

[15] Koziol, H., op. cit., note 5, p. 356.

[16] Von Bar, C., op. cit., note 2, p. 637.

[17] See Bezouška P. op. cit., note 9, p. 1579.

[18] See von Bar, C. (1998). The Common European Law of Torts. Volume One. New York: Oxford University Press, pp. 202–207.

[19] See Kötz, H. and Wagner, G., op. cit., note 13, p. 120.

[20] See Bydlinsky, F., op. cit., note 12, p. 212. Koziol, H. (2008). Úprava odpovědnosti za škodu v návrhu českého občanského zákoníku z hlediska srovnávací analýzy. In: Švestka, J., Dvořák, J., Tichý, L. (eds.) Sborník statí z diskuzních fór o rekodifikaci občanského práva konaných 21. 11. a 5. 12. 2008. Beroun: Eva Rozkotová – IFEC, p. 29. This approach is reflected in the new Austrian draft of the tort law reform (Section 1306). The actual concept of the principal’s liability in Section 1315 ABGB is based only partly on the principal’s fault. Unfortunately, the length of this article does not allow a more detailed analysis of the Austrian concept.

[21] Von Bar, C., op. cit., note 2, p. 636.

[22] See Renner, C. (2002). Die deliktische Haftung für Hilfpersonen in Europa. Berlin: Duncker & Humblot, pp. 181–182.

[23] See Renner, C., ibid., p. 183.

[24] For more details, see Kötz, H. and Wagner, G., op. cit., note 13, p. 132.

[25] Although mentioned in another context in the book, I got this idea from Spier, J. and Haazen, O. In: Spier, J., op. cit., note 1, p. 324.

[26] Section 2910 CC in connection with Section 2900 CC.

[27] See Fedtke, J. and Magnus, U. In: Spier, J., op. cit., note 1, p. 122.

[28] Section 2914 of zákon č. 89/2012 Sb., občanský zákoník.

[29] This conclusion is based on a comparative analysis of provisions with similar wording, especially Section 278 BGB, see Grundmann, S. (2012). In: Krüger, W. (ed.). Münchener Kommentar zum Bürgerlichen Gesetzbuch. Band 2. Schuldrecht – Allgemeiner Teil. 6th Ed. München: C. H. Beck., p. 851, and Section 1313a ABGB, see Koziol, H., op. cit., note 5, p. 348.

[30] Regarding the ABGB, see Koziol, H. and Vogel, K. In: Spier, J., op. cit., note 1, p. 26. For the BGB, see Fedtke, J. and Magnus, U. In: Spier, J., op. cit., note 1, p. 124.

[31] European Group on Tort Law, op. cit., note 7, p. 118.

[32] Section 420(2) of the former Czech Civil Code – zákon č. 40/1964 Sb., občanský zákoník.

[33] See Tichý, L. In Spier, J., op. cit., note 1, p. 60.

[34] See the analysis in Čech, P. and Flídr, J. (2015). Odpovídá zaměstnanec třetí osobě za škodu, kterou jí způsobí při plnění pracovních úkolů? Rekodifikace & Praxe, No. 3, pp. 15–22.

[35] BAG, 23 Jan. 1997, NZA 1998 p. 140.

[36] Dienstnehmerhaftpflichtgesetz (“DHG“). See especially Section 2 DHG.

[37] Section 257(2) of zákon č. 262/2006 Sb., zákoník práce.