The Abolition of Quasi-Immunity: A Good Thing?

A new law, expected to come into effect on January 1, 2025, willabolish the quasi-immunity of the execution agent (“auxiliary person”) and the prohibition on the concurrence of contractual and non-contractual liability.

What does this new law,Book 6 “Non-Contractual Liability” of the Civil Code, entail, and is it a positive development or not?

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Quasi-Immunity?

What is meant by “quasi-immunity of the execution agent”?

Important change: a third party can also be held liable (extra-contractual liability)!

Imagine: the client (party A) appoints a general contractor (party B). This contractor, in turn, engages the services of a subcontractor (party C). If this subcontractor makes an error (except in the case of a crime), the client can currently only hold the general contractor liable. Party A cannot hold party C accountable, meaning that party C, as an execution agent, enjoysquasi-immunity.

As a debt collection agency, we often encounter these situations, and in practice, it’s not always easy to collect the funds from the general contractor. And what if the general contractor goes bankrupt? Considering the current difficulties in the construction sector, this is not an uncommon occurrence.

Prohibition on the Concurrence of Contractual and Non-Contractual Liability?

The quasi-immunity of the execution agent is a result of the prohibition on the concurrence of contractual and non-contractual liability.This prohibition means that in a contractual relationship, you cannot hold the other party liable non-contractually, only contractually.

A situation that occurs under this prohibition: You buy a package, and it arrives broken when delivered by the courier. You only have a contract with the seller, so you cannot hold the courier contractually liable. After all, you have no contract with him (the seller does). You also cannot hold him non-contractually liable because the damage arises from the sales contract.

The abolition of this prohibition will allow you to hold both the seller and the courier liable.

Consequences of the Amendments to the Civil Code

To ensure that party A can also hold party C accountable,the automatic protection of the execution agent (quasi-immunity) and the prohibition on the concurrence of contractual and non-contractual liability will be abolished. This seems to be a good development, but with some caveats.

The new law willmake it easier to hold company directors personally liable. Currently, directors can only be prosecuted for criminal offenses. The new law implies that directors can also be held personally liable for non-criminal offenses, such as violations of corporate law or breaches of the duty of care.

General terms and conditions become even more important!

Not only directors butalso employees will be able to be directly sued in the future. Employees will still be protected by the immunity provided in Article 18 of the Employment Contracts Act, but this is not as robust as the current immunity of the execution agent. “Immunity will depend, for example, on whether the employee can be accused of ‘gross negligence’” (see this article).

Even more important will be contractual protection against liability.Contracts between employer and employee, directors’ agreements, and liability insurance should be reviewed. A small SME or self-employed person is less likely to do this and may be more often disadvantaged by this new legislation. The new law will also apply to existing contracts.

Do you have any questions about this new legislation? As your (international) debt collection partner, we’ll be happy to help you, without obligation. Please do not hesitate to contact us at s.dereze@tcm.be or on 0498 29 29 14.

16/02/2024