Regulation of Strict Liability in the CFR and the Estonian Law of Obligations Act

• Author: Janno Lahe
• Position: Docent of Civil Law, University of Tartu
• Pages: 167-175

1. Introduction

In delictual liability we can generally distinguish between fault-based liability and liability without fault if we look at it from the angle of the strictness of liability. Strict liability and producer liability are the most commonplace types of no-fault liability or heightened delictual liability. In addition to the afore-mentioned types of liability, several other no-fault cases under the law of delict may exist (such as the parental liability for a delict of a child less than 14 years of age). They are all opposed to fault-based liability arising out of the general elements of delict.

Within Chapter 53 of the Law of Obligations Act ¹ (hereinafter 'LOA'), which deals with unlawful damage, it is possible to distinguish the general elements of delict (Division 1) determinable as a set of specific prerequisites to liability in the presence of which the person causing the damage (tortfeasor) faces the obligation to compensate the injured party for the damage.The fault of the tortfeasor is one such prerequisite. Secondly there is a separate issue of strict liability (Division 2) where the act or fault of the tortfeasor is irrelevant, but rather it is ascertained whether the damaging result was caused by the actual realisation of the heightened risk characteristic to things or actions. The third type of liability under the law of delict regulated by the LOA is the liability for a defective product (Division 3).

The aim of this article is to provide for a comparative analysis of strict liability in the LOA and the provisions of the law of delict, as defined by the Study Group on a European Civil Code, in the Common Frame of Reference (hereinafter 'CFR')². The author of this article wishes to clarify whether the general elements of strict liability in the LOA and CFR are similar; and if not, which are the main differences between the two regulations and whether the difference of the LOA regulation from the CFR is justifiable in each case.

The author also wishes, in order to delimit his treatment of the subject, to note that this article will analyse only the general elements of strict liability. Legal literature specifies that we can speak of strict liability only where we deal with an institute, historically developed, under which the determinant factor of liability is whether the risk characteristic to the major source of damage realised or not³. Although the first article (3:201) of Section 2, Chapter 3 of the CFR, titled 'Accountability without Intention or Negligence' ⁴ , which regulates accountability for damage caused by employees and representatives, represents a case of no-fault liability, it does not, however, include classical elements of strict liability ⁵ , but rather is representative of a case of heightened liability⁶. Based on the same reasoning, the analysis does not cover the problems associated with producer liability (CFR Article 3:204, LOA §§ 1061-1067)⁷.

This article has six parts, the first of which treats strict liability in general, the second deals with the general elements of strict liability, the third one concerns the strict liability related to immovables and the fourth part is dedicated to strict liability related to animals. The fifth part analyses liability for motor vehicles. The sixth and final part of the article is about strict liability related to dangerous substances or dangerous emissions.

2. Strict liability in general

Strict liability can be treated as liability without a fault of the possessor of the major source of danger. Strict liability means that a person who causes excessive danger for another person is entitled to do so but must take account of the potential obligation to compensate for no-fault damage⁸.

As regards the evolution and developments of strict liability in European countries, one notes that in Great Britain the House of Lords laid the bases of strict liability in the case of Rylands v. Fletcher⁹. In French law, until the end of the 19th century, fault as the prerequisite to liability under the law of delict was not questioned ¹⁰ ; nevertheless, in 1896, the French cassation court made a sensational decision by ordering payment of compensation to a widow whose husband had died in an occupational accident despite failure to prove the company's fault¹¹.

In Germany, strict liability was introduced into positive law for the first time in the 1838 Prussian Railway Act. In 1909, keepers of a motor vehicle were subjected to liability without a fault (Kraftfahrzeuggesetz § 7). H. Hattenhauer believes that this gave a green light to no-fault liability¹². In 1922, the Federal Republic of Germany established the strict liability of aircraft keeper, thereafter in the other domains of strict liability. The authors of the German Civil Code (Bürgerliches Gesetzbuch,BGB), which entered into force on 1 January 1900, treated fault as the fundamental prerequisite to liability under the law of delict¹³. Strict liability was said to not, in any case, serve the development of circulation, but instead to unreasonably restrict the freedom of movement of an individual¹⁴.

Today, strict liability is an inherent element of liability under the law of delict. However, the entirety of delictual liability has not developed into no-fault liability, and today jurists and legislators alike consider the principle of fault viable. This is further proved by the part of the CFR dedicated to the law of delict, Article 1:101 (1) of which sets out that a person who suffers legally relevant damage has a right to reparation from a person who caused the damage intentionally or negligently (or is otherwise accountable for the causation of the damage). Thus, the authors of the CFR also treat fault-based liability as a rule and strict liability mostly as a special case.

In view of the developments of the law of delict in Europe, the predominant stance has been that negligence liability and strict liability are two equally important forms of liability and are not opposed to each other. Rather they are interconnected: on the one hand, in most legal orders fault liability does not impose an option to subjectively admonish the tortfeasor for the damage caused ¹⁵ ; on the other hand strict liability is not absolute, rather it is a hybrid institute of causal and fault-based liability¹⁶.

3. General elements of risk liability

The author understands the general elements of strict liability as a regulation which imposes liability for causation of damage with a major source of danger in general, without specifying such major source of danger. It should be noted that before entry into force of the LOA on 1 July 2002, the then applicable Civil Code of the Estonian SSR regulated the entire realm of strict liability in just one clause. The general elements of strict liability were contained in an indicative list¹⁷.

The CFR does not contain general elements of strict liability; however, it does not limit the provision of the additional elements or the general elements of strict liability to national law. Article 3:207 of the CFR sets out that a person is also accountable for the causation of legally relevant damage, if national law so provides, where it: (a) relates to a source of danger which is not within Article 3:103 to 3:205; (b) relates to substances or emissions; or (c) disapplies Article 3:204 paragraph (4) (e)¹⁸.

Subsection 1056 (1) of the LOA sets out that if damage is caused resulting from danger characteristic to a thing constituting a major source of danger or from an extremely dangerous activity, the person who manages the source of danger shall be liable for the causing of damage regardless of the person's culpability ¹⁹. A person who manages a major source of danger shall be liable for causing the death of, bodily injury to or damage to the health of a victim, and for damaging a thing of the victim, unless otherwise provided by law. Damage subject to compensation under strict liability provisions may be both patrimonial and non-patrimonial. The extent of compensation is regulated in Chapter 7 of the LOA ( § 127 ff.).

Thus, under Estonian law, strict liability may be applicable also to cases not specified in §§ 1057-1060 of the LOA. The prerequisite to this is that the damage has been caused by a major source of danger. The major source of danger is defined in § 1056 (2) of the LOA: a thing or an activity is deemed to be a major source of danger if, due to its nature or to the substances or means used in connection with the thing or activity, major or frequent damage may arise therefrom even if it is handled or performed with due diligence by a specialist. However, if liability for causing damage by means of a source of danger is prescribed by law, any thing or activity similar to such source of danger is also deemed to be a source of danger, regardless of whether the person who manages the source of danger is culpable or not.

In Estonian court practice, the following instances were not treated as major sources of danger: a barrier which dropped on a person's head at the entry to a paid parking lot (CCSC decision, 31 May 2007, in case 3-2-1-54-07), a telephone pole placed on the highway which the injured party's car hit (CCSC decision, 30 June 1994, in the case III-2/1-24/94), or the potable water within the building's piping which ruined the wallpaper in the injured party's living quarters after a pipe burst (CCSC decision, 24 April 1997, in case 3-2-1-53-97). Similarly, the Supreme Court did not treat the operation of a roll transporter as a major source of danger: the court stated that the imminent danger to the plaintiff, i.e...