Belgium reforms its Civil Code with changes to extra-contractual liability

On 1 February 2024, the Belgian House of Representatives approved the bill reforming Book 6 of the Civil Code, which focuses on "Extra-contractual Liability".

The new book comprises 55 articles and replaces, clarifies and modernises the previous law (which consisted of only six articles). The effective date for the new extra-contractual liability law is expected to be 1 January 2025.

Significant changes introduced

A significant aspect of this new law is that it establishes that legal entities and public administrations are subject to the same extra-contractual liability rules as individuals.

Additionally, it introduces several innovations, including the removal of quasi-immunity for executing agents (such as employees, company directors or contractors), signifying that from now on, they can be held directly liable by their principal's creditors. These innovations will be discussed in more detail below.

Another notable change brought about by Book 6 is the elimination of the exclusion of concurrence. Previously, if an event causing damage was a tort rather than a breach of contract, a party could only hold their counterparty contractually liable for damages. However, the new rules allow contracting parties to hold each other accountable for both contractual and extra-contractual claims.

Causation

Under the new law, to establish the well-known causal link between fault and damage, the so-called doctrine of equivalence will continue to be applied. This means that a fault can only lead to liability if the fault is a necessary condition for the damage to occur. If this is the case, the fault will be considered to be the cause of the damage, however improbable or indirect the actual course of events leading to the damage event (and to the resulting harmful consequences) may be.

There are two exceptions to this rule. If an error, in combination with other errors, is a sufficient condition for the damage, it will also be considered a cause.

On the other hand, if the connection between the fault and the damage is so remote that it would be unreasonable to attribute the damage to the defendant, a necessary condition for damage will not be considered a legal cause of action.

Damage

Under Book 6, the term "damage" is also redefined as "the economic and non-economic consequences resulting from the violation of a legally protected interest."

These damages must be personal and lawful, meaning that damages consisting of the loss of a benefit originating in an unlawful event do not give rise to compensation.

Moreover, the new extra-contractual liability law grants judges the authority to take preventive measures. They can impose prohibitions or orders on the liable party to prevent the exacerbation of damages that may arise from the repetition or continuation of the wrongdoing. Additionally, judges can impose these measures when there is a serious threat of violating a legal requirement.

Special liability

Lastly, Book 6 aims to consolidate various special liability regimes. Currently, it includes the Product Liability Act of 1991, but other special liability regimes may be incorporated in the future. This new legislation will not only have a significant impact on the liability of contractors (a thorough review of relevant contracts is strongly recommended) but also on the general legal position of any auxiliary, be they a company, a contractor or an employee, as it will become far easier to address them personally.

This is the first in our series of Insights on the reformed Civil Code. A number of sector-specific topics under the new law will be discussed further in this series.