Directors & Officers (D & O) Liability

Liability law is rapidly changing in quite a number of countries. This is due to various factors, which are interrelated to a large extent: changing case law and legislation as well as increased and still increasing technical and medical knowledge. As a result, various occupational diseases can, for example, be attributed to working conditions or personal injury to specific products. From the very moment that causation can be proven, the question arises of whether or not liability can be established‑ with far-reaching economic consequences for all parties involved. The rise of phenomena such as mass torts, multiple causation, joint and several liability or various heads of damages (like ecological damage and several diseases and affections) rapidly increases the interest in tort law. In the context of the interrelation between liability and insurance, attention must be paid to the question of whether certain liabilities are still coverable or not, and, if they are, to what amounts. (The question of jurisdictions is of growing importance as is the question of whether a specific liability can be covered by insurance. In this context, one should bear in mind that the affordability of tort law also requires safe and sound insurers. The recent past has shown that there is a limit to their financial stability.)

---

In recent years several cases concerning the liability of directors and officers have courted controversy. Arguments raised in such discussions oscillate between two extremes: on the one hand, the need for governing bodies to give a space to entrepreneurial discretion and on the other hand to ensure the protection of investors in and creditors of a company from the consequences of disadvantageous decisions by those bodies. In light of the geographical dispersal of the above stakeholders, the study offers a comparative insight into the liability of directors and officers in 10 key European jurisdictions (in particular, Austria, Czech Republic, Germany, Italy, the Netherlands, Norway, Poland, Spain and Switzerland) and 4 non-European jurisdictions (namely Brazil, Israel, Turkey and the United States). Amongst other things it investigates existing company law principles on the topic and examines their interaction with tort law and other fields with a view to suggesting principles for better stakeholder protection. National reports are complemented by an economic analysis and insurance, conflict of laws and comparative reports. The study also benefits from case study analyses.