Contractual Liability in Switzerland

Four Cumulative Conditions

1. Breach of Contractual Obligation

Total non-performance, partial performance, late performance or defective performance.

2. Fault (Presumed)

Art. 97 para. 1 CO: the debtor must compensate "unless proving no fault." Fault is presumed: the debtor must prove they acted without fault. This differs from tort liability (art. 41 CO) where the claimant must prove fault.

3. Damage

Difference between actual patrimony and patrimony if the contract had been properly performed (positive interest). Includes loss suffered (damnum emergens) and lost profit (lucrum cessans). If exact amount cannot be established, the court determines it equitably (art. 42 para. 2 CO by analogy).

4. Causation

Natural and adequate causal link between the breach and the damage.

Debtor's Defences

Proof of absence of fault: difficult to establish. Creditor's fault (art. 44 CO): may reduce compensation. Limitation clauses (art. 100 CO): void for wilful misconduct or gross negligence (art. 100 para. 1 CO).

Prescription

Ten years for contractual claims (art. 127 CO), compared to three years for tort claims (art. 60 CO) - a significant advantage.