Business Contracts

Whether bound by a results-based or a best-efforts obligation, the agent may invoke the limitation or waiver of liability clause in the agency agreement, provided he or she has not been guilty of gross negligence or wilful misconduct . 
The agent may also claim force majeure to avoid liability . Article 1218 of the Civil Code, resulting from the reform of contract law, states: “Force majeure in co …

Total or partial exemption from liability

Whether bound by a results-based or a best-efforts obligation, the agent may invoke the limitation or waiver of liability clause in the agency agreement, provided he or she has not been guilty of gross negligence or wilful misconduct . 

The agent may also claim force majeure to avoid liability . Article 1218 of the Civil Code, resulting from the reform of contract law, states: “Force majeure in contractual matters occurs when an event outside the debtor's control, which could not reasonably have been foreseen at the time the contract was concluded, and the effects of which cannot be avoided by appropriate measures, prevents the debtor from fulfilling his obligation”.

Fault on the part of the principal, or even the principal's own actions, may also limit or even waive the agent's liability. For example, a principal who had undertaken to inform the real estate agent in charge of transferring the leasehold rights of his commercial premises of any change in his status or in the lease to be transferred, and who failed to inform the agent that he had been struck off the trade and companies register and the register of trades (répertoire des métiers), not only cannot claim to have made his agent liable on the grounds that he failed to inform him sufficiently of the conditions governing the validity of the deed of transfer, but also commits a fault which is the sole cause of his loss .

 Similarly, according to the Court of Cassation, a court of appeal cannot reject an agent's claim for compensation for losses incurred when the fault is unrelated to the performance of the agency agreement, and the losses in question originate from an operational element over which the principal has retained control . An agent who has managed a portfolio of securities with due diligence cannot be required to compensate his principal for a shortfall in the expected results, when the latter has imposed unusual constraints on him, by wishing to have cash at his disposal on demand . On the other hand, according to the Court of Cassation, there can be no sharing of liability between the principal, who failed to take out insurance, and the agent, who was responsible for organizing the transport of his goods, since the intermediary should have informed the carrier of the nature of the old toys to be transported and given him instructions as to the precautions to be taken during transport, so that the latter alone must be held liable for all damage resulting from their theft during transport .

Cass. com., 12 July 2011, LawLex202300012550JBJ: In limiting the liability to the shipper of a carrier who had been given an agency agreement to take charge of CNC machines imported from Japan, the storage of which he had delegated to another undertaking, and during which damage had occurred, a court of appeal cannot hold that the agent was not guilty of gross negligence, such as to deprive him of the possibility of invoking a limitation of liability clause, without verifying, as it was called upon to do, whether the agent, despite his knowledge of the nature of the goods and the principal's request for tarpaulin cover, had not been warned by the warehouseman of the change in storage conditions and the absence of tarpaulin cover, but had not informed the principal, to whom he had continued to invoice for this service.

Civil Code, Art. 1231-1: “The debtor is required, where applicable, to pay damages either for non-performance of the obligation, or for delay in performance, if he does not justify that performance was prevented by force majeure”.  For an illustration, See Cass. 1re civ, 9 May 1994, LawLex202300013752JBJ, considering that a court of appeal cannot find that no fault can be attributed to an agent who sends his principal, by ordinary letter, a crossed check made out in the latter's name, on the grounds that the theft of this letter constitutes a case of force majeure, whereas the risk of theft of a check for a large amount sent by ordinary letter, does not present the unpredictability constituting force majeure. See Cass. 1re civ, 18 January 1989, LawLex202200008561JBJ, which refers to cases of force majeure.

Cass. 1re civ, 18 December 2014, LawLex202300013019JBJ.

Cass. com, 26 October 1999, LawLex200200004495JBJ.

Cass. com. 5 October 1999, LawLex202300012565JBJ.

Cass. com. 5 February 2008, LawLex202300012536JBJ.

Business Contracts

484. Total or partial exemption from liability

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484. Total or partial exemption from liability

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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