At the heart of the important discussion ongoing in Switzerland with regards to the Responsible Business Initiative (RBI) are some legal concepts which most young legal scholars struggled with – I can certainly speak for myself – I thought it might be interesting to share these as they are applicable to the discussion underway in Switzerland in relation to the upcoming vote.
The Law of Torts and other legal concepts
So, let’s talk about the Law of Tort, contractual liability, fault-based liability, vicarious liability, burden of proof, reversal of the burden of proof – I hope you are still awake!
The concepts in question relate to the responsibility of individuals or companies for causing damage to others. My University College Dublin course ‘Introduction to Tort’ led us through the maze of understanding as to who and why people became responsible for harm caused to others. We looked at different types of responsibility:
- Contractual liability – which comes about as a result of agreement /contract agreed upon and the responsibility when terms of this agreement are not respected. In such cases, the person who does not respect the agreement being responsible to repair the damages caused.
- Fault based liability – where damage is caused because of the negligence, lack of due care and attention by another. In such cases the damage must be proven, the causality established, and the injured party must then be compensated.
- Vicarious liability – comes about when certain persons or organisations have responsibility for damage caused to others, not because they have breached a contract, nor because they have been at fault and another was injured but just because of who they are. Examples of this include the liability of employers for the acts of their employees, the responsibility of proprietors for their property, the responsibility of parents for children, animals and so on. In cases where vicarious liability against employers is invoked, the injured party must establish that the person accused of the wrongdoing is the employer, that the acts of the employees caused harm and the employer must prove they put in place whatever was necessary to allow the employee to do their job correctly. In such cases the burden of proof is automatically attributed to the employer because of their status – quite simply that! Hold that thought.
Burden of proof and reversal of the burden
Switzerland has a Civil Law system and the various categories of liability are to be found in the Swiss Code of Obligations. An examination of criminal and civil cases allows one to understand that in civil cases claimants must prove their case on the “balance of probabilities”, whereas in criminal cases the burden of proof standard is much higher and the case must be proven “beyond all reasonable doubt” (remember the OJ Simpson case?).
Another legal concept relates to the “reversal of the burden of proof” and this is also important to understand with regards to the different examples given above. In the case of fault-based liability the burden of proving the case is on the claimant, who must show that the other party was negligent and at fault for the injuries suffered. When this is proven, the onus of proof can be reversed.
On the other hand, in cases of vicarious liability the claimant takes the case against the defendant on the basis of who they are (employer, animal or property owner) and the defendant must prove they have taken the actions necessary to avoid the damages caused.
Switzerland and the Swiss Code of Obligations
Here is Switzerland vicarious liability is to be found in different articles of the Swiss Code of Obligations. Articles 55 – employer’s liability, article 56 – responsibility of animal owners for their pets,
Article 58 – the responsibility of the owner of property for damage caused due to lack of upkeep or a problem in construction and with regards to parents’ liabilities for their children actions. And it is vicarious liability that is being discussed with regards to the Responsible Business Initiative (RBI) hence my insistence on the understanding of the legal concepts.
Article 55 (1) CO states that an employer “is liable for all damage done by his servants or employees in the course of their employment, unless he can show that he has taken all necessary precautions required by the circumstances to avoid the doing of the damage, or that the damage would have been done even if had taken these precautions” that bears understanding. (Translation: Williams “The Sources of Law in the Swiss Civil Code p 121)
Article 55(1) CO relates to the objective liability of a principal, such as an employer, for the damage caused by its agent and according to Nicolas Bueno “despite the narrow wording of Article 55(1) CO, the majority view considers that a relationship of subordination may exist between two legal entities, as known in other countries. Several authors argue accordingly that Article 55(1) CO already encompasses liability of companies for the harm caused by other companies under their control, in particular subsidiaries within a corporate group”. In any case whether everyone is in agreement with this argument it is obvious that in Switzerland the liability of an employer is clear, they are responsible just because of who they are. With regards to proof required, the burden is on employers to show that they have done everything necessary to avoid the subsequent damage from occurring.
The Responsible Business Initiative – Responsibility of Business
The Responsible Business initiative’s wish is to add Article 101a to the Swiss Constitution under the heading ‘Responsibility of Business’ and in line with article 55 CO the intention is to ensure that “Corporations are liable for the damage caused by themselves and by those under their control unless they can prove that they took all due care to avoid the damage, or that the damage would have occurred even if all due care had been taken”. It is important to note also that a successful result in Switzerland will allow victims of human rights or environmental abuses to bring their cases in Swiss civil courts, but employer/defendants cannot be brought to the criminal courts to answer for their wrongdoings.
A Moderate Solution
So, if this initiative is successful Switzerland will take their place among the many other responsible governments who are trying to ensure better behaviour from their global companies. But as University of Fribourg Professor Franz Weber stated in his article on ‘The Swiss Responsible Business Initiative and the Counter-Proposal‘, “…applying principals’ liability to corporate group relationships for the wrongdoing of their subsidiaries…is in line with a clear domestic and international trend. Neither draft extends the applicable liability parameters; instead, they simply give them a concrete expression, and even limit the potential scope of tort liability by requiring human rights or environmental law violations. The liability rule anchored is thus in effect rather modest if not timid.” He further stated “Besides giving the defendant the possibility to escape liability by bringing an exculpatory proof – just like art 55 Swiss Code of Obligations (OR), the rule imposes liability on parent companies only for wrong done by subsidiaries they effectively control. Accordingly, relative to international trends, Switzerland has thus opted for a moderate solution”.
PLEASE NOTE : There is a lot of discussion underway with regards to comparative law and comparative tort law. The world where business is carried out is a global one so clarity in countries with companies who operate globally is essential to ensure a just world for everyone. This is why a positive response to the Responsible Business Initiative is vital.
Further reading
ECCJ COMPARATIVE TABLE – mHRDD WITH CORPORATE LIABILITY LAWS IN EUROPE
The Swiss Responsible Business Initiative and the Counter-Proposal
InDret: Burden of Proof and Strict Liability: An Economic Analysis of a Misconception
The Swiss Responsible Business Initiative and its Counter-Proposal
Understanding Vicarious Liability in Tort – The value of a comparative perspective
https://www.nzz.ch/meinung/konzernverantwortung-eine-nuechterne-wuerdigung-ld.1586853?reduced=true
Reconnecting With Commonsense 
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