Vicarious Liability (Hilfspersonenhaftung)

Concept

Vicarious liability refers to the liability of a principal, employer, or contracting party for losses caused by persons engaged to carry out their business or contractual duties (employees, agents, subcontractors). Under Swiss law, a distinction is drawn between non-contractual principal liability, from which the principal can be released by proving due care in selecting, instructing, and supervising the auxiliary person, and the stricter contractual form of vicarious liability, under which an exculpatory defence is practically excluded.

Exculpatory Options

In the non-contractual context, a principal may be released from liability by demonstrating that they exercised the care required in the circumstances when selecting, instructing, and supervising the auxiliary person; if this defence fails, they are held causally liable for the loss caused by that person. In the contractual context, by contrast, a contracting party is generally liable without limitation for the conduct of their auxiliary persons as if it were their own.

Relevance for Commercial Liability Insurance

Vicarious liability is one of the most important grounds for coverage under commercial general liability insurance, as businesses regularly must answer to customers and other third parties for the misconduct of their employees and engaged third parties.