On March 18, 2018, in the US state of Arizona, a self-propelled car belonging to the driving service agent Uber collides with a 49-year-old cyclist. The cyclist dies in hospital (see CNN 20.03.2018, Uber’s self-driving car killed someone. What happened?). Not least in the USA, the question of liability immediately arises in such a case. While liability cases already raise difficult actual and legal questions in the analogue world, the digital world is becoming even more complex. Because between man and machine there is now also a digital component that acts more and more autonomously (keyword “Artifical Intelligence, AI”, see also below).
“Liability” in the legal sense is the obligation to answer for damage. Liability is to be distinguished from warranty, i.e. the responsibility for a defect in relation to a product (good or service). In Switzerland, a basic distinction is made between contractual liability (Art. 97 et seq. of the Swiss Code of Obligations, CO) and non-contractual liability (Art. 41 et seq. CO). There is also liability based on fault and causal liability.
According to Art. 97 CO, a debtor has to pay compensation for a loss arising from the fact that he does not or cannot properly fulfil his agreed obligation unless he proves that he is not at fault (exculpation, see below).
The basis of a liability under Art. 97 CO is therefore an agreement or contract under Art. 1 CO (“Mutually agreed expression of will”). Consequently, if there is no contract between the party who caused the damage and the injured party, this type of liability cannot form the basis of a claim.
What is special about this type of liability is that the law assumes fault in a case of Art. 97 CO. The perpetrator can, however, try to prove the contrary by proving that he is not at fault (exculpation, release from guilt).
In the case of non-contractual liability, there is no contract between the aggrieved party and the aggrieved party, according to the designation. The simplest example is the crash between two cars. In the case of non-contractual liability, a distinction is also made between fault liability, in which there must be fault (see below), and causal liability, in which there is liability for a particular constellation (see below).
Liability for fault according to Art. 41 CO
According to Art. 41 of the Swiss Code of Obligations, the perpetrator is obliged to compensate the injured party if he causes damage to the injured party unlawfully, either with intent or as a result of negligence.
Consequently, the prerequisite for liability under Art. 41 CO is intentional or negligent unlawful conduct and the resulting (causal) damage.
Any conduct that violates any Swiss legal rule is unlawful within the meaning of Art. 41 CO. This must be done either intentionally or negligently. Negligent means that the perpetrator does not comply with his legal duty of care under the given circumstances.
A loss pursuant to Art. 41 of the Swiss Code of Obligations is deemed to have occurred if there is a difference in the property of the injured party before the damaging event and after the damaging event. There are essentially two conceivable situations (somewhat simplified). Either the injured party effectively has a “hole in the cash register” (effective loss; e.g. in a car crash due to the costs of repair) or he misses a possible future profit (lost profit; e.g. in the event of loss of wages; see diagram). Insurance companies in particular also distinguish between personal injury (damage to a person, e.g. injury), property damage (damage to an object, e.g. damage to property) and other damage, i.e. damage that is neither personal injury nor damage to property (e.g. financial loss or damage to property caused by a lawyer to his client as a result of an error in the lawsuit, including the foregoing).
According to Art. 41 CO, there must also be a connection between the unlawful conduct and the damage, and a causal connection from a legal point of view. A distinction is made between a natural and an adequate causal link, the latter being a prerequisite under Art. 41 CO. For example, there is a natural causal connection between a murder and the birth of the murderer in the sense that the murder would not have occurred if the murderer had not been born. According to Art. 41 of the Swiss Code of Obligations, the parents of the murderer who conceived him cannot be held responsible for the murder. Here the lawyers intervene with adequate corrective measures. This is essentially about the question of predictability. This is obviously not the case with this striking example. But there are also examples that are less obvious and therefore more controversial. The question is whether a host who gives a guest so much alcohol that he subsequently causes an accident could also be held responsible for the damage in accordance with Art. 41 CO.
The causal liability differs from the fault liability according to Art. 41 CO in one point. In causal liability, the perpetrator is also liable without fault. In the case of causal liability, liability is associated with a certain constellation. An example of this is the liability of a motor vehicle owner according to Art. 58 of the Road Traffic Act (RTA). According to this provision, the motor vehicle owner is not liable because he is at fault, but only because he is the owner of the motor vehicle (special constellation), in particular if he does not cause an accident himself, i.e. someone else is driving than he is driving. The legal justification for this liability, a so-called strict liability, lies in the fact that driving a car in general represents a major risk, which only Switzerland claims more than 200 lives per year (see Info ASTRA 13.03.2018). In other words, driving should be generally prohibited. However, because the general public assumes that driving is of great benefit, driving with a permit (driving test, driving licence) is permitted. However, the owners of a car are subject to a general, strict, causal liability.
An important type of causal adhesion (see above) is product liability. Although this liability is only effectively known to a few, it is becoming more and more important in practice (see below). Product liability in Switzerland is regulated in the Product Liability Act (PLA). Product liability serves essentially, but not only, consumer protection. In principle, the law makes it easier for consumers to be compensated for damages arising from product defects.
The liable party is according to art. 1 in connection with Art. 2 PLA is primarily the manufacturer, i.e. the person who manufactured the end product, a basic substance or a partial product. “Manufacturer” within the meaning of the Act also means any person who claims to be a manufacturer by affixing his name, trademark or other identification mark to the product and thus acting as a manufacturer towards the customer (apparent manufacturer, quasi-manufacturer). This is often the case today, for example, with the own products of the retailers Coop and Migros. “But “manufacturer” in the sense of the law can also become an importer. Strict quality control is therefore essential for this importer. Finally, every person is considered a “manufacturer” within the meaning of the law if the customer cannot determine who the effective manufacturer is and the supplier of the product cannot name the effective manufacturer to the customer within a reasonable period of time.
According to Art. 3 PLA, a product under this Act is any movable object, even if it forms part of another movable object or an immovable object. The law explicitly mentions electricity as movable property. According to prevailing doctrine, however, software, in particular an app, is also considered a product within the meaning of Art. 3 PLA (in particular HAVE 2017, Barbara Klett, p. 104 ff., with further references).
Prerequisite for a liability according to PrHG is damage caused by a defect of a product, whereby the injured party must prove the defect, the damage and an adequate causal relationship between the defect and the damage. A product is defective if it does not offer the security that one is entitled to expect under consideration of all circumstances. In particular, the manner in which it is presented to the public, the use that can reasonably be expected and the time at which it was placed on the market play a role (Art. 4 PLA). In addition, in the sense of a deductible, according to Art. 6 PLA only damages exceeding the amount of CHF 900 (i.e. from CHF 901) can be claimed under the PLA. Although the law effectively speaks of a “deductible” here, it is not the case that an aggrieved party must bear this amount himself in every case. After all, he can also claim it conventionally via contractual or non-contractual liability (see above).
The Product Safety Act (PSA) also plays an important role in the context of product liability. In addition to product-specific regulations, this defines in general terms the product safety to be expected in accordance with the Product Liability Act.
According to Art. 5 PLA, the manufacturer may relieve himself of the burden or is not liable if he proves that he did not place the product on the market, it is to be assumed under the circumstances that the defect which caused the damage was not present when he placed the product on the market, he neither manufactured the product for sale or any other form of distribution with an economic purpose nor manufactured or distributed it within the framework of his commercial activity, the defect is due to the fact that the product complies with binding government regulations or the defect could not be detected according to the state of science and technology at the time when the product was placed on the market. Furthermore, the manufacturer of a raw material or a component shall not be liable if he proves that the defect was caused by the design of the product in which the raw material or component was incorporated or by the instructions of the manufacturer of that product.
Pursuant to Art. 8 PLA, liability under this Act cannot be excluded (mandatory provision!).
Especially because of the product liability according to the product liability law it is enormously important for a potential manufacturer according to this law (see above) to carry out a strict quality control of his products and he also absolutely needs an insurance which covers the risk of the product liability.
In the event of the killing of a person or bodily injury (Art. 47 CO) or personal injury (Art. 49 CO), the law provides that an injured party may be awarded not only damages but also a cash payment for the so-called mental illness, a satisfaction.
Statute of limitations
Statute of limitations (inter alia Art. 127 et seq. CO) in the legal sense means that a claim still exists, but that it can no longer be enforced in court provided that the debtor raises the plea of limitation (Art. 142 CO). This also means that a claim which has become statute-barred can still be satisfied and, if it has been paid by mistake, can no longer be reclaimed on the basis of unjust enrichment (Art. 62 et seq. CO).
Claims from tortious liability pursuant to Art. 41 et seq. CO, on the other hand, expire relatively within 1 year according to Art. 60 CO! However, if the action is derived from a criminal offence for which criminal law prescribes a longer limitation period, this also applies to the civil claim. The period begins when the injured party becomes aware of the damage and the person liable for compensation. In any case (absolute) this liability also expires within 10 years.
According to Art. 9 PLA, product liability claims expire within 3 years of the injured party becoming aware of the damage, the defect and the person of the manufacturer or should have become aware of it.
If the statute of limitations threatens in a case of liability, this can be changed in accordance with Art. 135 et seq. CO may be interrupted by recognition of the claim by the liable party or by collection of the liable party. This restarts the statute of limitations. Not provided for by law, but regularly applied in practice, is the contractual waiver of limitation by the liable party. In this way, the debtor can avoid debt collection.
Pursuant to Art. 100 CO, a prior agreement according to which liability for unlawful intent or gross negligence would be excluded is null and void. This means that only an exclusion of liability for slight negligence can be considered; in practice, it is difficult to distinguish between gross and slight negligence.
Pursuant to Art. 8 PLA, agreements which restrict or exclude liability towards the injured party under this Act are null and void. In conjunction with Art. 1 PLA is therefore only permissible in the relationship between business and business to exclude liability for property damage. In the Business to Consumer relationship, an exclusion of liability is completely impossible or void.
The most spectacular liability lawsuits take place in the USA. The main reason for this is that large companies can not only be ordered to compensate for the actual loss, but can also be ordered to pay punitive damages in civil proceedings. This payment is set so high by the courts that the liable companies effectively change their harmful behaviour. One of the best known and most illustrative cases is the “McDonald’s Coffee Case”, even though it was finally settled by settlement. In this case, a woman in the USA suffered severe burns because of the (too) hot coffee. Although there were several such cases, McDonald’s neither brewed the coffee less hot nor warned of the hot coffee. Meanwhile, the McDonald’s coffee mug contains at least one warning that cannot be overlooked (see picture; details at Wikipedia: https://en.wikipedia.org/wiki/Liebeck_v._McDonald%27s_Restaurants).
Adhesion in robotics, especially for self-propelled cars
Robots are increasingly forcing people out of work and action processes, which from a liability perspective means that they can no longer be held responsible for mistakes. The robot itself cannot become the subject of liability. Therefore, the product itself and an associated defect are increasingly becoming the focus of liability law. This is a typical case of product liability in Switzerland in the sense of the PLA. Thus the liability risk of the manufacturers increases with the digitalisation of the products, whereby the product liability is even aggravated by the fact that it is a causal liability (see above). An interesting question that has not yet been resolved in this respect still arises in the legal literature, namely how it is with manufacturer liability for self-learning products, i.e. products that develop themselves further in the company.
Particularly because of the case of the over-vehicle causing the accident described in the introduction to this chapter, the liability of self-propelled cars is currently frequently discussed. When we talk about “self-propelled cars” in the following, we mean cars with full automation in which the system takes over the driving task completely and the person no longer uses the system.
I have to monitor. These cars no longer have a handlebar in the conventional sense. The handlebar becomes a passenger and relies on the product “car”. The same situation exists today with a lift. There are also no accompanying persons, the “liftboys” of that time. It is still highly conceivable that passengers will have to intervene in the event of obvious faults in the car. If there are several passengers, however, the question arises as to which passenger would have been responsible. In fact, but also de iure, the driver is no longer responsible for liability. However, the owner of the vehicle remains the person responsible for liability. He remains liable (causally; see above) according to art. 58 RTA. In the case of self-propelled cars, as explained above, the manufacturer who is liable according to PLA (also causal) will come into the stronger focus of liability law.
It can be stated that the current laws are essentially sufficient to make polluters responsible for the damage. However, it is also the case that, within the framework of digitisation, there are new circumstances which call for new rules tailored to these circumstances.
Melinda F. Lohmann and Markus Müller-Chen have written a detailed scientific article on the problem of self-propelled vehicles, in particular self-learning vehicles, in SZW 2017 p. 48 ff.
The well-known liability lawyer and meanwhile emeritus professor Peter Gauch from the University of Fribourg has always said that you do not need any insurance, except a liability insurance. This opinion, which was expressed decades ago, has become even more important in recent years, as both private individuals and companies are increasingly in a position to cause enormous damage with minor errors or causes, especially in the field of information technology and digitisation. These damages represent enormous risks for the causers, against which they must insure themselves by means of liability insurance.
In the case of liability insurance, it is essential to check whether the effectively existing risks are covered at all and if so, with a sufficient sum insured. It should be borne in mind that insurance companies exclude certain risks and areas in order to minimise their own risk. However, if these risks or areas are relevant to a private individual or a company, an explicit inclusion must be negotiated with the insurance company.
Legal expenses insurance
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