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BY 4.0 license Open Access Published by De Gruyter November 5, 2022

XX. Norway

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A. Legislation

1. Act on Changes in the Compensatory Damages Act (Endringer i skadeserstatningsloven) 30 April 2021

1The Act on Changes in the Compensatory Damages Act sec 3–9, skadeserstatningsloven (skl), has been in force since 1 June 2021 and gives the legal grounds for a regulation to establish a capitalisation rate when measuring the amount of damages for personal injuries. Previously, this capitalisation rate had been established through Supreme Court verdicts.

2The regulation of the capitalisation rate is intended to be used in general for all personal injuries. However, according to the change in skl § 3–9, if there are special reasons for deviating from this general rule, the Court can use another capitalisation rate.

2. Act on Changes in the Motor Vehicle Liability Act (Endringer i bilansvarslova) 26 May 2020

3The Act on Changes in the Motor Vehicle Liability from 26 May 2020 has been in force from 1 January 2021 and is based on the preparatory works in Prop 137 L (2018–2019).

4Through changes in sec 9 of the Act on Motor Vehicle Insurance, bilansvarsloven (bal), the limit of compensation for damage to property is increased from NOK 10,000,000 to NOK 100,000,000, due to legislative harmonisation with other Nordic countries.

5In addition, through changes in bal sec 2, motor vehicle insurance is extended to legally unregistered vehicles, such as tractors and excavators, even if they are not used on a public road or in a public area. According to the preparatory works of the Act, this change is the result of decisions from the European Court of Justice (CJEU), specifically Vnuk, Andrade, Torreiro and BTA Baltic Insurance Company.[1]

6Also, the Norwegian Law Department sent a suggested change regarding sec 3–9 in the Compensatory Damages Act, skadeserstatningsloven (skl) at a hearing on 30 August 2019, providing the opportunity to state the capitalisation interest in a specific regulation instead of case law, as is the case today.

B. Cases

1. Norges Høyesterett (Norwegian Supreme Court, HR) 9 March 2021, HR-2021-530-A: Statute of Limitations for Claim for Damages Related to Lack of Payment of Payroll Tax

a) Brief Summary of the Facts

7A company had been subjected to bankruptcy proceedings, and shortly afterwards, an audit by the tax authorities uncovered that the company had failed to calculate and pay payroll tax. After a tax re-assessment, the Norwegian State represented by the Ministry of Finance claimed compensation from the former chairman of the board of the company according to sec 17–1 in the Companies Act (lov om aksjeselskaper, asl). The chairman denied liability and argued that the claim was time-barred according to sec 9 of the Limitation of Claims Act (foreldelsesloven, fl), which subjects claims to a three-year prescription period.

b) Judgment of the Court

8The Supreme Court noted that it was not disputed that the chairman of the board had acted negligently according to asl sec 17–1. Likewise, there was no dispute regarding the calculation of the State’s economic loss. The main question before the court was if the claim for compensation was time-barred.

9According to fl sec 9, a claim is time-barred three years after the day on which the plaintiff gained knowledge of the damage and the liable party or should have gained such knowledge. Referring to a Supreme Court decision in Rt-2011–1029, the Court noted that this meant that the three-year time limit started to run when the victim gained such knowledge about an economic loss or a future loss that he objectively has a basis for such a claim and has the knowledge to formally make a claim for damages in the legal system. In addition, two Supreme Court decisions in Rt-2012–543 and HR-2019-2034-A made it clear that the time limit did not start to run before the consequences of the acts of the tortfeasor had become known, more specifically through an actual economic loss or a definite future loss.

10Since the formal claim for damages was sent to the Conciliation Board by the tax authorities on 6 December 2018, the question was if the tax authorities had the necessary knowledge about the economic loss before 6 December 2015, so that the claim was time-barred according to fl sec 9. The tax re-assessment of the payroll tax for 2014, which the Supreme Court case concerned, was completed on 21 July 2016. If the starting point of the three-year prescription period in fl sec 9 was the tax re-assessment, the claim would not be time-barred in the case at hand.

11The Supreme Court emphasised that the claim made by the tax authorities against the chairman of the board was to be considered an ordinary claim for damages based on tort law. However, the Supreme Court noted that this claim was secondary to the State’s tax claim against the company. According to the preparatory works to the Norwegian Tax Law and the Supreme Court decision in Rt-2011–1029, tax authorities do not have the freedom to choose between making a claim against a board member or against the company. A claim can only be made against a party other than the company when it is evident that the company would not be able to pay the tax authorities, often when the company was declared bankrupt. According to the decision in Rt-2011–1029, this was generally the earliest possible starting point for the three-year time limit. However, there could be exceptions, for instance when the time between the default of the claim and the bankruptcy was especially long.

12Based on the preparatory works and previous Supreme Court decision, the majority of the Supreme Court noted that, in cases of claims against a company, the three-year time limit did not start to run before the plaintiff gained knowledge about the company being unable to fulfil the payment to the tax authorities. In cases of tax re-assessment, this meant that the plaintiff would not have the necessary knowledge before the re-assessment was formally finalised with a decision by the tax authorities according to sec 12–1 subsec 1 in the Tax Administration Act. After this decision, the claim would be due, and a recovery of the claim could be made. Generally, there would be no loss for the tax authorities (and thus no knowledge of the loss) before the recovery had proved to be unsuccessful.

13However, the Supreme Court argued, in cases where the company was bankrupt, or other cases where it was evident that the tax debtor was not able to fulfil the claim by the tax authorities, the prescription period could start to run without a decision according to sec 12–1 in the Tax Administration Act. A claim based on the common rules of tort law had its own legal basis compared to tax law. Thus, whether a sustained economic loss could be considered manifested or a future loss definite, based on fl sec 9 and previous Supreme Court verdicts, had to be decided according to the principles of tort law.

14Based on this, the Supreme Court emphasised that the starting point of the prescription period was the plaintiff’s knowledge of his sustained or future economic loss and of the causal link to the tortious act, as indicated in Rt-2011–1029. The tortious act by the chairman of the company was her failure to fulfil her obligation to pay the payroll tax. The economic loss suffered by the tax authorities was caused by not fulfilling this obligation. Thus, the tortious act marks the starting point of the three-year prescription period if the condition related to the plaintiff’s knowledge was also fulfilled.

15The majority in the Court at this point in their decision presented a lengthy argument against the tax re-assessment being the starting point of the three-year prescription period:

16Firstly, the tax re-assessment did not establish the obligation to pay payroll tax to the tax authorities, a fact that was shown in sec 11–2 of the Norwegian Tax Payment Act, which stated that interest must be paid if the payment by the tax debtor is not made when the payment is due.

17Secondly, in a previous Supreme Court decision in Rt-2012–722, the majority noted, the three-year prescription period according to fl sec 3 no 1 was considered to start running when the payment of tax was due, before a tax re-assessment had been made. Thus, fl sec 9 should be interpreted in the same way.

18Thirdly, according to previous Supreme Court decisions in Rt-1949–743 and Rt-1961–1217, the tax authority could file claims against the bankruptcy estate of a tax debtor even if the authorities had not yet made a formal decision according to the tax legislation. This fact showed, the majority in the Supreme Court argued, that the existence of a claim depended on the specific legislation in the case at hand.

19Fourthly, there were generally no reasons to postpone the commencement of the three-year prescription period of fl sec 9 until the tax re-assessment was made by the tax authorities when it was already evident that the State would suffer a loss because the company or the bankruptcy estate would not be able to pay their tax. Under such circumstances, neither the company nor the bankruptcy estate would have any substantial interest in the process of tax re-assessment by the tax authorities. Thus, the administrative process would be of no use and not fulfil its purpose. In addition, in a case of bankruptcy, the tax authorities cannot perform an individual debt collection, making it quite meaningless to consider the time of due payment to be when the tax re-assessment is complete, so that the authorities can initiate debt collection proceedings according to the Norwegian Tax Payment Act sec 14–1.

20Fifthly, to allow a lawsuit before the tax re-assessment is performed would not replace the administrative processes of the tax authorities if the obligation to pay tax was based on legislation and decisions from the Norwegian parliament. A tax re-assessment is directed against the company and not possible tortfeasors. In a lawsuit based on tort law, the burden of proof regarding their economic loss is on the authorities and the courts have to assess the compensation due.

21Based on this, the majority in the Court concluded that the three-year prescription period according to fl sec 9 would start to run even if no tax re-assessment had been made in cases where the company was bankrupt, or where, for other reasons, it was evident that the company would not be able to pay the tax.

22The tax authorities, the majority in the Supreme Court noted, gained knowledge that there would not be enough money to fulfil the claim against the company shortly after the estate administrator had published the first annual report on 8 September 2015. The report, which the tax authorities had access to, showed that claims without security made against the estate would not be covered in the bankruptcy estate, including the claim for payroll tax.

23Thus, from this point in time, the plaintiff had the knowledge necessary to formally make a claim for damages in the legal system, the majority in the Supreme Court argued, since the amount of the economic loss was estimated in the audit performed by the tax authorities shortly after the bankruptcy of the company. As previously mentioned, the formal claim for damages was sent to the Conciliation Board by the tax authorities on 6 December 2018. Based on this, the majority concluded that the claim by the tax authorities was time-barred according to the three-year prescription period in fl sec 9.

c) Commentary

24The main question in this case is at what point in time can the economic loss of the tax authorities be considered to materialise itself according to fl sec 9 and the relevant previous Supreme Court decisions. The plaintiff cannot have the necessary knowledge (to formally make a legal claim for damages) according to fl sec 9 and the relevant decisions as regards the commencement of the prescription period, before this point in time.

25The majority in the Supreme Court argues, as previously mentioned, that the obligation for the company to pay taxes was established before the tax re-assessment, when the estate administrator had published the first annual report on 8 September 2015. At this point in time, it was evident that the company would not be able to fulfil its duties to pay the payroll tax.

26However, an important argument against the claim being time-barred is that, in cases of company tax and tax re-assessment for companies, the preparatory works of the Norwegian Tax Law quite specifically state that the liability of other persons and legal subjects is secondary to the liability of the company. And probably even more important, sec 14–1 of the Tax Payment Act does not allow the tax authorities to collect debts from the company before the tax re-assessment is complete.

27Thus, even based on common tort law, the tax authorities apparently did not have the basis and the call to take legal steps against the chairman, whose liability is secondary to the company, before the tax re-assessment was complete on 21 June 2016. If so, the claim against the chairman was not time-barred according to the three-year prescription period, as the formal claim for damages was sent to the Conciliation Board by the tax authorities only on 6 December 2018.

28In addition, one of the main purposes of the starting point of the prescription period in fl sec 9, is to ensure that the claimant does not have to make a claim before the Court until all the relevant facts of the case are sufficiently obvious and known by the claimant. In the case at hand, the loss of the tax authorities does not seem to have fully manifested itself before the tax re-assessment had been finalised. Until then, the tax authorities in principle could choose not to pursue the collection of debts from the company.

29One of the main arguments of the majority in the Court seems to be the previous Supreme Court decision in Rt-2012–722. According to this previous decision, the prescription period regarding a primary claim starts running according to fl sec 9 when the payment to the tax authorities is due, even when only a part of the obligation has been fulfilled by the debtor. The reasoning by the majority in the Court in the case at hand seems to be that if the prescription period for primary claims can start to run before the tax re-assessment, so can the prescription period for the secondary claim when it is evident that the primary claim will not be fulfilled through the bankruptcy proceedings.

30However, the main purpose of the Limitation of Claims Act and the main structures of the statutes in the Tax Payment Act speak against such a reasoning regarding secondary claims. It makes sense that the prescription period of the primary claim according to fl sec 9 can start to run before the tax re-assessment since the payment is due at a much earlier specific time according to tax law.

31To extend this reasoning to secondary claims does not make as much sense. The most apparent point in time for the secondary claim to be due is when the tax authorities have completed the tax re-assessment and collected the individual or collective debts. Even if it is likely or evident that there is no money to collect before this point in time, the starting point of the prescription period according to fl sec 9 will become quite unpredictable if the tax authorities and the secondary debtor must rely on other statements or evidence regarding the likely result of future collections of individual or collective debts.

32The minority in the Court, consisting of one judge, argued against the conclusion of the majority based on some of these arguments against the secondary claim being time-barred. In my opinion, this line of reasoning is more consistent with the relevant legislation in the case at hand than the arguments of the majority in the Supreme Court.

33Still, the Supreme Court can be expected to follow the reasoning and conclusion of the majority in future cases regarding fl sec 9.

2. HR 19 April 2021, HR-2021-822-A: Motor Vehicle Liability for Car Parked between Two Houses

a) Brief Summary of the Facts

34A car parked in a carport between two houses caught fire due to a defect in the car’s electrical system. The two houses were severely damaged. The insurance company that compensated the house owners’ damage in accordance with their home insurance policies claimed recourse from the insurance company of the car, which included third-party motor vehicle insurance. However, according to sec 2 subsec 1, lit b of the Norwegian Automobile Liability Act (Bilansvarsloven, bal), the insurance does not include damage which occurred while ‘... the car is appropriately put in a position away from a street, road or other places available to the public’. According to the insurance company of the motor vehicle, this exemption was applicable to the case at hand.

b) Judgment of the Court

35The majority of four judges in the Supreme Court emphasised that, according to the preparatory works of bal, motor vehicle insurance should be extensive rather than limited, ensuring that the insurance includes cases where the car was parked, even if such cases had previously been excluded from liability according to decisions from the Supreme Court. This was followed by previous Supreme Court cases in Rt-1965–451 and Rt-2012–233. Thus, the majority of the Supreme Court argued that the exemption in bal sec 2, subsec 1, lit b should be interpreted in a restrictive manner.

36In addition, the majority of the Court argued that the preparatory works show that the liability should be extended so far as to include the special risks related to a motor vehicle, such as the speed, weight, mobility, motor, car horn and technical equipment of the vehicle. The explanation for exemptions for situations when the car was parked was explained by the lack of risk elements like weight, mobility and speed. On the other hand, the preparatory works note that the insurance should extend even to parked cars if there were risk elements related to the engine or technical equipment. It was even explicitly emphasised that damage caused by fire should be included in the insurance if the damage was related to normal risks related to cars.

37Based on this, the majority of the Supreme Court argued that the various conditions for the exemption in bal sec 2, subsec 1, lit b, were interconnected, and the overarching perspective of the legal interpretation had to examine whether the relevant risks indicated that the situation should be covered by the motor vehicle insurance.

38The first condition in the exemption ie that the car was put away (‘bortstilt’ in Norwegian), was not a part of everyday speech, the majority in the Court noted. However, the wording and preparatory works indicated that it was not enough to fulfil the condition that the motor vehicle was stationary. According to the preparatory works, the exemption was limited to situations where the motor vehicle was appropriately put ‘out of use’ outside public traffic. The vehicle had to be parked and stationary after a temporary finished or clearly interrupted period of driving. This condition could be fulfilled, the preparatory works emphasise, even when there are passengers in the vehicle, for instance when taking a break.

39The wording of the second condition of the exemption ie that the car must be ‘removed from ... places available to the public’, indicated that only a limited group of people must have access to the area because of physical restriction or social conventions, the Court argued. However, the preparatory works state that the condition includes any area that is open for public traffic, even if the area is privately owned or access was given through payment. Thus, the majority in the Court argued, the wording and the preparatory works related to the second condition in the exemption indicate that parked cars, to a large extent, are included in the insurance cover, according to bal.

40Still, the majority in the Court stated, despite the wording and the content of the preparatory works, the conditions for the exemption in bal sec 2, subsec 1, lit b are not satisfied if the risks relevant for the motor vehicle insurance were present in the situation, including risks related to the engine and technical equipment.

41Also, the majority in the Supreme Court noted, in later amendments to bal, the preparatory works stated that the interpretation of ‘removed’ in the exemption had to take into account the interpretation of ‘use of vehicles’ in the Motor Vehicle Directive. Even though the preparatory works stated that a car ‘appropriately’ put away (from public places) according to bal sec 2, subsec 1, lit b could not be considered ‘use of vehicles’ according to the Directive, the preparatory works emphasised that bal had to be interpreted in light of the verdicts of the European Court of Justice (CJEU).

42The majority in the Court then referred to the decision in Línea Directa from the European Court of Justice.[2] In this case, a car had been parked for more than 24 hours in a private garage. The car caught fire because of a malfunction in the electrical system of the car, and the building was damaged. According to Spanish tort law, the owner of the car was strictly liable for this damage. The CJEU concluded that the insurance company was liable for the damage according to the Motor Vehicle Directive based on the following line of reasoning cited by the Supreme Court: the parking of a car is a natural and necessary part of the use of the vehicle for transportation. Thus, the vehicle is used as a means of transport both when driving and when parked between driving sessions, even in a private garage. And even parking for more than 24 hours can be a necessary condition for the next driving session.

43Based on the decision in Línea Directa regarding the condition of ‘use of vehicles’ in the Directive, the majority in the Court concluded that, according to bal, a vehicle in frequent use could not be considered ‘put away’ (from public places) despite the wording in bal sec 2, subsec 1, lit b, and the statements in the preparatory works. The wording and preparatory works are not clear, and the preparatory works state that the insurance should include all risks related to a vehicle. This conclusion would also be in accordance with the statements in later preparatory works regarding the relation between bal and the Motor Vehicle Directive.

44Thus, the Court stated, the conclusion in the case at hand, involving an ordinary parked car, was that the conditions of the exemption in bal sec 2, subsec 1, were not satisfied.

c) Commentary

45The arguments of the four judges in the majority in the Supreme Court seem quite pragmatic based on the general purpose of bal and the harmonisation of Norwegian national law with the verdict from the CJEU, at the expense of a more nuanced and detailed reasoning based on the available legal sources.

46The first objection against the reasoning of the majority is that the preparatory works to bal are probably more conclusive regarding the content of the exemption in bal sec 2, subsec 1, lit b, even considering the passages cited by the majority. As previously mentioned, the preparatory works clearly state that even temporary parking, also with passengers inside, fulfils the condition ‘put away’ (from public places) in the exemption. It is also evident that a private parking space between two houses, surrounded by private property and remote from public roads as in the case at hand, is removed ‘from ... places available to the public’. Thus, the two conditions of the exemption from liability appear to be satisfied.

47In addition, even considering the general purpose of insurance liability in bal, it is far from evident that a risk of fire due to a defect in a car’s electrical system while the car is ‘removed’ from the public is a risk of damage typically associated with motor vehicles. Based on this, there is no obvious reason to make an exception to the exemptions in bal sec 2 for such cases based on this general purpose.

48Also, the majority of the Supreme Court did not consider that the main purpose of the Motor Vehicle Directive, as shown by Almeida,[3] is to secure that the liability for motor vehicles according to national tort law is covered by insurance in each State. Thus, even with the EEA/EU agreement being transposed into Norwegian law, the obligation towards the EU as regards implementing the Directive in Norwegian national law has certain limitations. Contrary to Spanish law, that was the relevant national law in Almeida, in Norwegian tort law there is no liability for a car ‘appropriately’ put away according to bal sec 2, subsec 1, lit b.

49The minority of the Supreme Court concluded that the conditions of the exemption in bal sec 2, subsec 1, lit b were satisfied, mainly based on arguments from national and EEA/EU law. Even the Norwegian State, which participated in the proceedings to make statements regarding public interests according to sec 30–13 in the Norwegian Dispute Act, argued that bal sec 2, subsec 1, lit b was in accordance the principle of effectiveness in EEA/EU law since there was no liability for parking a car ‘appropriately’ according to common tort law in Norway.

50However, it is possible to make the counterargument that Norwegian law should aim to harmonise bal with the decisions of the European Court of Justice as far as possible, even if there is no legal obligation to do so. This is also emphasised as a possibility in Norwegian legal literature. Still, in the case at hand, the wording of the legislation and the preparatory works in general do not seem to support such an approach. Almost all legal arguments based on the available legal sources indicate that an appropriately parked car is not included in the insurance liability for motor vehicles.

51The one remaining counter argument that seems to support the conclusion of the majority in the Supreme Court is that the preparatory works clearly assume that a car parked according to the exemption in bal sec 2, subsec 1, lit a does not represent a ‘use of vehicles’ according to the Motor Vehicle Directive. This assumption seems to be proven wrong by Almeida[4] where the European Court of Justice quite broadly states that parking is a natural and necessary part of using a vehicle for transportation, even when parked for more than a day.

52Still, this statement in the Almeida case can be seen from the perspective of strict liability for parked cars according to Spanish law. The European Court of Justice could have considered Norwegian law to be in accordance with the Motor Vehicle Directive based on the general purpose of the Directive and the principle of effectiveness, together with the fact that there is no liability in the case at hand based on Norwegian common tort law.

53However, based on the conclusion of the majority of the Supreme Court, this potential tension between Norwegian law and EU/EEA law has been eliminated.

3. HR 5 May 2021, HR-2021-967-A: Board Members’ Liability for Negligence according to the Companies Act and the Compensatory Damages Act

a) Brief Summary of the Facts

54After the commencement of bankruptcy proceedings in a company, a creditor (Landskapsentreprenørene) in an ongoing contractual relationship with the company claimed damages from the company’s board members. The board members had acted negligently according to sec 17–1 of the Companies Act and sec 4–1 of the Compensatory Damages Act by not giving complete information to the creditor about the economic situation of the company, the creditor argued. However, the board members argued that the original claim against the company had been reduced between the time of the negligence and the start of the bankruptcy proceedings because of payments from the company. Thus, the creditor had no economic loss to be compensated. Also, the board members argued, due to the weak economic situation of the company, the company could not have made payments to the tax authorities without acting illegally according to sec 402 (which prohibits giving an advantage to certain creditors in case of bankruptcy) of the Norwegian Penal Code, even if the tax authorities had been informed about the economic situation earlier.

55The Appeal Court concluded that the board members had acted negligently by not giving complete information about the company’s failing economy and awarded the creditor NOK 605,164 (approx € 60,000). Before The Supreme Court, the only question was whether there was a causal link between the negligence of the board members and the economic loss of the creditor.

b) Judgment of the Court

56The Supreme Court emphasised that, according to the preparatory works of the Companies Act, the question of causality had to be decided based on the rules of common tort law. In a previous Supreme Court decision in Rt-1992–64, the condition of causality would usually be fulfilled if the damage, in this case the pure economic loss according to skl § 4–1, would not have occurred without the action or the omission. According to two previous Supreme Court decisions regarding pure economic loss in Rt-2003–400 and Rt-2005–65, the plaintiffs were compensated as if the board members had not acted negligently. Thus, the economic loss of the creditor was the difference between the current economic situation and the situation as it would have been if board members had given complete information about the economic situation.

57The Supreme Court noted that the facts of the case were mainly undisputed, and that the question regarding causality that needed further consideration was related to the hypothetical. According to the verdicts in Rt-2003–400 and Rt-2005–65, the board members had the burden of proof regarding the hypothetical.

58If the creditor had been sufficiently informed by the board members about the economic situation of the company in the case at hand, the creditor would probably have stopped working until the company had given a guarantee for payment or payment in advance, the Supreme Court argued. The economic situation was so severe that it was not likely that the creditor would have continued to work with the bankrupt company, with only dividends as compensation for the creditor.

59Thus, the Supreme Court argued, the receivables that were earned by the creditor after the negligence of the board members was lost because of the lack of information. Without dividends from the bankruptcy, this economic loss should be compensated according to common tort law.

60However, the Supreme Court noted, it was also necessary to consider other probable consequences of the board members giving complete information of the economic situation of the company. One had to consider what would have happened under such circumstances with the receivables that were already earned at the time the board members acted negligently. The question was if these receivables still would have been paid by the company in the same way the company had done prior to the bankruptcy declaration.

61The Supreme Court emphasised that, according to a previous Supreme Court decision in HR-2017-2375-A, the members of the board in a company would not be held liable unless the economic situation was so severe that the company was insolvent, and that it was not realistic to avoid bankruptcy. As a result, at the time of negligence, the company was not able to fulfil its obligations towards all its creditors. Prioritising specific creditors could be prohibited according to sec 402 of the Norwegian Penal Code. Thus, it was not likely that the board members would have prioritised making payments for the receivables that the creditor had already earned.

62Based on this, the Supreme Court argued that the economic loss of the company consisted of the unpaid receivables that were earned after the negligence of the board members, but with a deduction for the receivables for which the creditor had received payment before the negligence. Together, this represented the increase in receivables before the bankruptcy of the company caused by the negligence.

63The remaining question was at which time the board members could be considered to have acted negligently, the Court stated. The Appeal Court had concluded that the board members had been negligent starting from 1 January 2016 when the receivables for which the company had not received payment was NOK 2,254,174 (approx € 225,000). However, the Supreme Court noted, the negligence continued through 2016 because sufficient information was never provided. Thus, the question was if the stipulation of the economic loss should be based on the situation when the negligence started or the situation later in 2016. On 16 August 2016, the receivables for which the company had not received payment were at their lowest value, NOK 347,647 (approx € 35,000). At the time of the bankruptcy in 2017, the receivables not yet paid by the company were NOK 1,786,096.

64The Supreme Court noted that there were no previous Supreme Court decisions regarding this question. The basic considerations of tort law gave no definitive answers. Generally, preventive consideration made it reasonable to expect a tortfeasor to pay higher compensation for economic loss in cases of continued negligence, the Court noted. However, the Supreme Court argued, in the case at hand, the receivables for the creditor were reduced from the time of the first instance of negligence until the the time of the bankruptcy. Thus, the only way an economic loss could be stipulated for the creditor was to compare the receivables on 16 August 2016 with the receivables at the time of the bankruptcy in 2017. In principle, a claim of negligence could be made concerning any point in time, the Court noted. However, the Court argued, since the reduction of receivables on 16 August 2016, was the result of payments from the company (the debtor), it seemed unreasonable that such payments should lead to an increase in the creditor’s compensation.

65Based on this, the Supreme Court stated that the negligence of the board members should be considered as a whole, and not separate cases of negligence throughout 2016. The Court considered this to be in line with the principle that the economic loss of the creditor was the difference between the current economic situation and the situation as it would have been if board members had given complete information about the economic situation.

66Thus, the Supreme Court stated that the creditor should be compensated for any increase in receivables from 1 January 2016 until the bankruptcy. However, at the time of bankruptcy, the receivables were lowered compared to the situation on 1 January 2016. Thus, the Court concluded, the creditor had not suffered any economic loss that was caused by the negligence of the board of the company.

c) Commentary

67This case demonstrates the complications when considering the hypothetical or contrafactual in the assessment of an economic loss according to common tort law. The Supreme Court was quite thorough in specifying some basic principles regarding this assessment.

68However, some of the principles specified do not come to the fore in the case at hand because the Supreme Court concluded that no loss was suffered by the plaintiff after the board of the company had acted negligently.

69Thus, the fundamental question discussed by the Court in the case at hand was only if a tortfeasor can be considered to have acted negligently as a whole from the first instance of negligence, or if the tortfeasor should be considered to have acted negligently continuously each day until the relevant information was given to debtors regarding the economic situation of the company.

70Based on the common rules of tort law, the correct conclusion would be that the board of the company acted negligently each day until the relevant information was given. However, it is not evident that this is the correct approach in the assessment of the economic loss caused by the negligence. The Supreme Court itself argued that it is reasonable that the assessment of the loss includes (by doing a subtraction in the loss) the payments made by the company to the creditor after the point in time when the board started to act negligently.

71An even more fundamental argument in the same direction is that it might appear arbitrary to calculate the loss based on points in time other than the start and end of the negligence. In this case, it may be difficult to make a rational argument for calculating the economic loss starting from the point in time when the loss of the creditor was at its lowest. Of course, it can be argued that the board at that specific point in time (when the loss was at its lowest) could have given the necessary information to the company and avoided further economic loss. However, there was no special call to give information to the creditor at that specific point of time, compared to the situation before and afterwards.

4. HR 21 June 2021, HR-2021-1332-A: Calculation of Damages related to Sec 3–5 of the Compensatory Damages Act

a) Brief Summary of the Facts

72In the Court of Appeal, a man had been convicted of long-term abuse and grossly negligent sexual assault against his spouse. He was also ordered to pay aggravated damages to his spouse based on skl sec 3–5 for each separate incidence of abuse. The man appealed the question of aggravated damages to the Supreme Court, primarily claiming that the conditions for aggravated damages were not fulfilled. He also made a subsidiary claim, arguing that the compensation should be calculated based on the abuse as a continuum, and not as separate incidents.

b) Judgment of the Court

73Regarding the claim that the condition for aggravated damages according to skl sec 3–5, first subsec was not fulfilled, the Supreme Court stated that there were two conditions for compensation according to sec 3–5, first subsec, lit b: based on the standards of proof in criminal law, the perpetrator must have acted in a way that can be subsumed under the criminal offences referred to in skl sec 3–3. In addition, based on the standard of proof in civil cases, the perpetrator must have acted intentionally or grossly negligently.

74The Supreme Court emphasised that compensation according to skl sec 3–5 is calculated individually and in a discretionary manner as a lump sum. According to a previous Supreme Court decision in HR-2020-1345-A, the calculation is based on what is reasonable considering the seriousness of the act, the degree of guilt, the way the victim has perceived the violation, and the effects of the damage. In addition, according to the same verdict, the level of punishment is relevant, including the legal development of the level of punishment. Also, the victim’s contributory conduct and the financial circumstances of the perpetrator can be taken into consideration according to the preparatory works of the Compensatory Damages Act. In cases of abuse in close relationships, a previous Supreme Court decision in Rt-2004–1794 stated that it is relevant to consider the duration of the relationship, the psychological dependence between the perpetrator and the victim, and the mental burden of living with a threat at home.

75The most important consideration, the Supreme Court stated, was the seriousness of the act of the perpetrator from an objective perspective. According to a previous Supreme Court decision in Rt-2012–1576, the consequences of violence can be somewhat diverse, and, although relevant, should not be decisive for the consideration. Such an approach also makes it easier to calculate the amount of non-pecuniary compensation as a part of the proceedings in the criminal case, and saves the victim from the mental burden of documenting the psychological damage, according to a previous Supreme Court verdict in HR-2018-1909-A.

76According to a Supreme Court decision in HR-2020–1345, the considerations of providing compensation to the victim have gradually become more important, while the considerations of the preventive effect has been pushed to the background. Regarding the criminal offences referred to in skl sec 3–3, the risk of criminal liability secures the preventive effect.

77The Supreme Court noted that previous Supreme Court decisions provided guidance for the calculation of non-pecuniary damages for some situations. Victims of intentional rape in the form of sexual intercourse are awarded NOK 150,000 (approx € 15,000), the grossly negligent rape of an adult is awarded NOK 90,000 (approx € 9,000), and each dependant is awarded NOK 200,000 (€ 20,000) in cases of murder of the first degree. The courts should only deviate from this guidance in particular cases, according to a previous decision in Rt-2011–743 and Rt-2012–201.

78The Supreme Court emphasised that the decision had to be in line with the presumption of innocence according to sec 96 in the Norwegian Constitution and art 6 no 2 of the European Human Rights Convention. In the case at hand, the Supreme Court stated, the perpetrator had been acquitted of sexual assault, and the difference had to be made clear between the standard of proof in criminal cases and civil cases. The Court should avoid using the terminology of criminal cases in the part of the case not regulated by criminal law, as stated in a previous Supreme Court case in HR-2018–1909.

79In the case at hand, the perpetrator threatened his spouse, denying her contact with other people, only occasionally allowing her to leave the home, in addition to physical abuse from 2008 until November 2012 when the most serious abuse occurred after a gathering with the extended family. Still, even after this event, the perpetrator continued to abuse his spouse several times a month, often in front of their children. The Court of Appeal awarded the spouse non-pecuniary damages of NOK 150,000 (approx € 15,000) for this abuse.

80For the perpetrator’s sexual assault, of which he had been acquitted in the criminal case, the Court of Appeal awarded the spouse NOK 200,000 (approx € 20,000) according to skl sec 3–5. The Court of Appeal argued that this case represented a particular case where the Court could deviate from the guidance from previous Supreme Court decisions regarding the calculation of damages. The Supreme Court stated that even though the Court of Appeal apparently based this part of the decision on some conditions that were related to the terminology and conditions of criminal law, which would be wrong, the Supreme Court (with some doubt) considered the verdict of the Court of Appeal to be based on the conditions for non-pecuniary damages in skl sec 3–1.

81However, the Supreme Court found that the Court of Appeal had used the wrong approach when calculating the total amount of compensation according to skl sec 3–5 by adding together the damages for the physical abuse and the sexual assault, awarding the spouse NOK 350,000 (approx € 35,000).

82In criminal cases, the Supreme Court emphasised with reference to sec 79 of the Norwegian Penal Code and a previous Supreme Court decision in HR-2017-1282-A, the sentencing was determined with the most serious offence as the starting point, with additional punishment for the other offences. The overall punishment was, as a result, less severe than the punishment for each individual offence added together.

83According to skl sec 3–5, the Court noted, non-pecuniary damages should be calculated based on different variables related to the victim and the perpetrator. It was not relevant if the criminal offence was continuous in nature or occurred as separate incidents. The penal provision against abuse in close relationships as referred to in skl sec 3–3, includes many different criminal offences. According to the preparatory works, only the most serious offences were taken into account in addition to the penal provision against abuse in close relationships.

84Thus, the Supreme Court argued, in cases where multiple tortious acts were committed against the victim, non-pecuniary damages according to skl sec 3–5 should be calculated based on an overall assessment. The specific adjustment in the overall assessment depends on the connection between the tortious acts and whether or not the tortious acts had the same type of consequences for the victim. In cases of several perpetrators, individual claims for non-pecuniary damages could be submitted by the victim according to skl sec 3–5, subsec 2.

85In the case at hand, the Supreme Court noted, the abuse had continued for nine years, and the sexual assault for three years, in parallel with the abuse. The mental and physical abuse was serious in nature. Based on the seriousness and the duration of the abuse, the level of the punishment of the perpetrator in the criminal case, and previous Supreme Court cases regarding skl sec 3–5, the Supreme Court awarded the victim NOK 250,000 (approx € 25,000).

c) Commentary

86This Supreme Court decision is based on important insights regarding the connection between criminal law and skl sec 3–5, and the importance of this connection when calculating the amount of non-pecuniary damages.

87The insights provided by the Supreme Court in this case demonstrate that it is sometimes necessary to harmonise the approach of criminal law and tort law in order to avoid inconsistencies in the legal system.

5. HR 22 June 2021, HR-2021-1338-A: Failure to Comply with Insurer’s Condition to Undergo Surgery

a) Brief Summary of the facts

88A pilot lost his aviation licence after his medical certificate was withdrawn according to EU Regulation no 1178/2011 due to a gallstone problem. The pilot claimed compensation for the withdrawal of the certificate based on an insurance policy covering the loss of a licence taken out by the employer of the pilot. However, the insurance company argued that the consequence of the pilot’s refusal to comply with the insurer’s surgery condition resulted in a lapse of the liability of the insurance company according to sec 13–12 in the Insurance Agreement Act (forsikringsavtaleloven, fal).

b) Judgment of the Court

89The Supreme Court noted that the insurance coverage in the case at hand would only allow partial payment according to the insurance for instances where the pilot’s medical certificate had been withdrawn, and the insurer’s doctor considered the medical condition to be permanent. If the insurer’s doctor considered the pilot to be permanently unfit after an additional twelve months, the remainder of the compensation according to the insurance contract should be paid by the insurance company.

90The parties agreed that, without surgery to remove his gallstones, the pilot would not get his medical certificate back. Thus, the question was if the insurance company could refuse to make payments according to the insurance, completely or partially, if the pilot refused to undergo the surgery.

91According to sec fal 13–12, the insurance company could order the pilot to undergo medical treatment that clearly would reduce the extent of its liability. An exemption could be made if the order unreasonably interfered with the freedom of the pilot. If the pilot intentionally or grossly negligently did not comply with an order from the insurance company, the liability of the insurance company could be reduced or lapse completely.

92Regarding these three conditions or considerations, the Supreme Court found that the plaintiff’s duty to reduce the extent of the loss according to the common rules of tort law could give guidance even if this duty is not regulated in the Insurance Agreement Act.

93Regarding the first condition in fal 13–12, that the medical treatment would clearly reduce the extent of the liability of the insurance company, the Supreme Court noted that the result of the medical treatment had to be that the pilot would be given back his medical certificate. According to EU Regulation No 1178/2011, a condition for this was that the applicant for the certificate had no medical problems in his stomach or intestines. This also included applicants that had undergone surgery of the digestive system or associated organs unless the surgery resulted in a full restitution and a satisfactory gastroenterological assessment.

94Thus, the Supreme Court noted, the threshold for having the medical certificate returned was relatively high. Also, the condition that the extent of the liability would clearly be reduced implied that there was a high probability that the certificate would be returned. According to the preparatory works of the Insurance Agreement Act, the insured party could not be ordered to undergo treatment if the chances of success were questionable. However, the Supreme Court stated, fal sec 13–12 could not be interpreted in a way that was so strict that the condition of high probability for successful treatment could be fulfilled in most cases. Thus, the standard of proof was higher than usual in civil law, but not as high as in criminal law.

95Applied to the case at hand, the consideration should be based on acknowledged medical science, the Supreme Court argued. The medical expertise before the Court stated that the surgery related to the gallstone problem could be considered routine surgery, and that between 92 % and 94 % of patients who had surgery were subsequently pain-free, according to medical research and literature. In addition, the risk of serious complications was very low. However, between 10 % and 14 % of patients suffered permanent negative consequences after the surgery. As a result, some pilots may not have their medical certificates returned due to some of these consequences.

96All things considered, the Supreme Court stated that the probability of successful surgery to remove gallstones was between 85 % and 90 %. Thus, the conclusion was that the the standard of proof for a successful medical treatment that would clearly reduce the extent of the liability of the insurance company was satisfied in the case at hand.

97Regarding the second condition or consideration in fal sec 13–12, if the surgery represented an unreasonable interference in the freedom of the pilot, the Supreme Court stated that the wording of neither sec 13–12 nor the preparatory works of the Act gave specific guidance for the interpretation of sec 13–12 in this regard. Also, there were no previous Supreme Court decision regarding the interpretation of fal sec 13–12. Thus, the decision had to be based on a balancing of different interests.

98On the one hand, the individual freedom and integrity of the insured had a strong standing. However, this freedom was not without restrictions, especially when the freedom to make decisions had consequences for others, in this case the insurance company, which had to compensate the insured.

99Some guidelines regarding the freedom of the insured could be drawn from previous Supreme Court decisions regarding the duty to mitigate losses according to the rules of common tort law, the Supreme Court stated.

100In a decision in Rt-1962–938, the Supreme Court concluded that a mother with the sole responsibility for three minors had no duty to undergo surgery, even if this would probably reduce the extent of her personal injury. The woman would have had to leave her children for seven weeks while in hospital, and she would not have been able to do any housework for a couple of months. The verdict demonstrated that the extent of individual freedom in this regard had to be based on considerations regarding the individual situation and burden of the victim or the insured.

101In a verdict in Rt-1985–46, the compensation to a dance teacher following non-pecuniary damage was not reduced by the Supreme Court although the victim did not undergo surgery for damage in their eye. There was little information about the surgery and its consequences, the Court stated, and the surgery would be an unreasonable burden for the victim given her condition after the accident.

102These previous verdicts indicated that what could be considered an unreasonable interference in the freedom of the insured was dependent on the concrete circumstances of the case, the Supreme Court stated. Also, the decisions indicated that the individual burden for the insured was an important factor in this consideration.

103Firstly, the pilot in the case at hand was reluctant to have an organ removed from his body because each organ had a function, the Supreme Court stated. The surgery related to the gallstone problem required the removal of the gallbladder. However, for most people, bodily functions were completely intact after the removal of the bladder. And even in cases with complications, the complications were moderate. Thus, the Supreme Court argued, the removal of the gallbladder was not in itself an unreasonable interference in the freedom of the pilot.

104Secondly, the pilot was afraid to be put under anaesthesia as a part of the surgery. Regarding this, the Supreme Court noted that the necessity of anaesthesia indicated that the surgery was not trivial. Also, some patients experience panic attacks related to the procedure for anaesthesia. However, there was no information that indicated that it was likely that the pilot would suffer a panic attack. The pilot had referred to an incident of delayed and uncomfortable awakening from anaesthesia in 1991 when he had his appendix removed, but his medical files indicated nothing extraordinary. Thus, the anaesthesia related to the surgery was not an unreasonable interference in the freedom of the pilot.

105Thirdly, the pilot did not want to undergo surgery because of the risk of unforeseen and serious complications. Although such fears could not be ignored, the Supreme Court stated, the individual fear of the pilot had not been substantiated in the case at hand.

106Fourthly, the pilot had argued that it was possible for him to live with the pain from the gallstone problem, which occurred three or four times a year. The pain lasted a few hours, and he did not even need to use painkillers. The extent of the pain experienced by the insured was relevant when considering whether the surgery would represent an unreasonable interference with the freedom of the insured, the Supreme Court noted. Still, the consequence in the case at hand was that the pilot risked losing his job, which was a burden for him. In addition, there was a risk of further medical complications by not performing the surgery. Thus, the fact that the pilot was able to live with the gallstone problems did not make the surgery an unreasonable interference with his freedom.

107Based on this, the exemption in sec 13–12 of the Insurance Agreement Act was not fulfilled, and the pilot could be ordered to undergo surgery as a condition for receiving compensation from the insurance company.

108Regarding the third condition in sec 13–12 for reducing the liability for the insurance company, ie that the insured had acted intentionally or grossly negligently when not following the order of the insurance company, the Supreme Court noted that the pilot had acted intentionally.

109Thus, the question according to sec 13–12 was whether the liability for the insurance company should lapse completely or if it only should be partially reduced, the Supreme Court stated. The Court argued that the consequences for the insured should be the same as if the surgery had been performed, and that the insurance company would not be liable under such circumstances. Based on this, the insurance company was not liable to pay any compensation in the case at hand.

c) Commentary

110This verdict is of interest not only regarding insurance law, but also regarding the rules of common tort law. The Supreme Court itself emphasised that, when considering the duty to mitigate losses according to insurance law, especially regarding what can be considered an unreasonable intervention, the victim’s duty to mitigate losses according to common tort law can be a guideline.

111In the previous Supreme Court cases regarding Norwegian tort law, which the Supreme Court referred to, the duty to mitigate losses is barely discussed beyond the summary of reasoning that the Court presented in the case at hand: the duty to mitigate losses is based on the individual situation and burden of the victim.

112Thus, this new decision from the Supreme Court gives valuable additional guidelines regarding the duty to mitigate losses by undergoing surgery, especially based on the discussion regarding what can be considered an unreasonable interference for the victim. Although the case at hand was regulated by insurance law, the Court makes it clear that the additional guidelines will also be relevant for tort law.

113On the one hand, the burden on the victim or the insured if a surgery or other medical treatment is to be performed is central to the duty to mitigate the loss, as already stated in Rt-1962–1938. In this regard, according to the Supreme Court decision in the case at hand, also the subjective fears of the victim or the insured regarding the surgery or other medical treatment are relevant in the considerations. This is especially so if the surgery or other medical treatment can lead to panic attacks or other substantial psychological reactions. Also, the subjective fear of unforeseen or unknown consequences of the surgery is relevant. However, these fears must be substantiated for them to be relevant regarding the duty to mitigate the loss.

114On the other hand, considering the extent of the duty to mitigate losses, one must also take into consideration the actual probable consequences of the surgery or other medical treatment, in addition to the economic consequences for the tortfeasor or the insurance company if the surgery is not performed. If there is a high probability that the surgery or other medical treatment will be successful, even if the outcome is not certain, this will be a substantial argument for the duty to mitigate losses. Also, the risk of further medical complications if the surgery or medical treatment is not performed must be considered.

115In addition, even if there are substantial burdens on the victim or the insured, the importance of these burdens must be balanced against the fact that the tortfeasor or the insurance company must compensate the victim or the insured if the surgery or the medical treatment is not performed. As the Supreme Court states, there are limits to the freedom and the integrity of the victim or the insured in this regard. However, in the case at hand, the Court did not seem to consider the freedom and integrity of the insured to be truly threatened by undergoing the surgery.

6. HR 12 November 2021, HR-2021-2201-A: Liability towards a Third Party for Defects in Residential Buildings

a) Brief Summary of the Facts

116A contractor had built a complex of three residential buildings under a contract with a development company and then transferred the buildings to a housing cooperative in 2006. In 2017, the housing cooperative filed a claim against the development company regarding a discount and damage related to defects in the staircase windows and on the façade. The claim, based on sec 37 of the Norwegian House Building Act, bustadoppføringslova (buofl), was time-barred according to sec 10, subsec 1 of the Norwegian Limitation Act. However, according to previous decisions by the Supreme Court, damages based on general rules of tort law could be awarded in addition to compensation based on the rules of the House Building Act. Thus, the question before the Supreme Court was if these conditions for damages were fulfilled for the housing cooperative as a third party. Previous Supreme Court decisions had considered this issue in relation to the tortfeasor’s duties of performance and control according to the Planning and Building Act, plan- og bygningsloven (pbl), despite this Act formally only establishing duties toward the government.

b) Judgment of the Court

117The Supreme Court stated that compensation according to the general rules of tort law depended on two conditions: the first condition was that the rules of the House Building Act could be supplemented by the general rules of tort law. The second condition was that the liability of a third party could be established based on the general rules of tort law. The Court emphasised that these two conditions were intertwined to a certain extent. In addition, the Supreme Court stated that a subsidiary question (if the conditions for compensation were fulfilled) was if the statute of limitations according to the House Building Act could also be applied to the claim for damages, according to the general rules of tort law.

118Regarding the first condition for liability stated by the Supreme Court, the Court found that three previous Supreme Court decisions, Rt 2015, 276, HR-2017-1834-A and HR-2020-312-A, clearly indicated that the general rules of tort law could supplement those of the House Building Act, also regarding the statute of limitations.

119The development company had argued that this extension could not be extended so far that it interfered with the system of notification of defects and statute of limitations in the House Building Act. However, the Supreme Court noted that, even according to contractual law, the ordinary time limit for notification of defects could be disregarded in cases of gross negligence. In addition, the Supreme Court noted that the previous Supreme Court verdict in HR-2020-312-A stated that the arguments against the application of tort law intervening with contractual law would be a part of the considerations according to the rules of liability for third parties in general tort law. Thus, the tension between contractual liability and liability based on tort law could be reduced, the Court stated.

120Regarding the second condition for liability according to tort law, the Supreme Court noted that the three Supreme Court decisions previously mentioned clarified the conditions for third party liability based on the Planning and Building Act. Although the decision in Rt 2015, 276 indicated a broad consideration regarding liability, the Supreme Court emphasised that all three cases demonstrated that the third party must have suffered a significant loss and been subjected to a difficult situation if the conditions were to be fulfilled. In addition, the verdicts made clear that the conditions for compensation could more easily be fulfilled if the breach of duty related to the Planning and Building Act represented a gross violation of rules concerning fundamental functions of a building, such as safety and health.

121Applied to the case in HR-2020-2021-A, the Supreme Court referred to the verdict of the Appeal Court that found that employees of the development company had acted negligently when the windows were installed and controlled in the staircase of all three buildings, and that the conditions for employer’s liability according to skl (the Compensatory Damages Act) sec 2–1, sec 1 were satisfied. However, the Court argued, the arguments of the Appeal Court did not address the question of liability towards a third party such as the housing cooperative that was the claimant in this case. Thus, the arguments of the Appeal Court were not sufficient grounds to establish liability for the development company.

122The Supreme Court found, based on the evidence provided by the house cooperative, that the development company had acted negligently in relation to several duties according to the Planning and Building Act. Still, this was not considered relevant to the question of liability towards a third party. The costs of repairing the windows amounted to NOK 650,000 (approx € 68,000) and were not related to the individual apartments of the building and did not concern the quality of living for each resident. The cost for each apartment was NOK 5,000. Based on this, both the individual and total costs of repairing the windows were modest. Defects and deficiencies regarding the facade of the buildings that had been compensated based on other legal grounds were not relevant in this regard, the Court argued. And even including these defects, it was difficult to see that the defects related to the buildings were massive, contrary to the situation in the cases in Rt 2015, 276 and HR-2020-2021-A, when the Supreme Court awarded damages to a third party.

123Thus, the Supreme Court concluded that the consequences of any breach of duty by the development company did not satisfy the strict conditions for liability towards a third party according to general rules of tort law that had been established by previous Supreme Court decisions.

124Finally, the Court noted that this conclusion made it unnecessary to consider whether it was necessary to consider the statute of limitations and the time limits of notification in the House Building Act, also when submitting claims based on general tort law.

c) Commentary

125The conclusion reached by the Supreme Court in this case is in many ways not surprising.

126According to the rules of common tort law in Norway, the threshold for third party liability is high. In the previous Supreme Court verdicts referred to in this case, compensation was awarded to a third party after gross negligence by the tortfeasor regarding fundamental duties to perform and control according to the Planning and Building Act was established. Such gross negligence is something that traditionally extends liability to third parties in Norwegian general tort law.

127In the case from 2021, however, the negligence of the tortfeasor was much more limited and of a much less fundamental character as regards its performing and controlling duties.

128Possibly even more important, the gross negligence in the previous cases had very serious consequences for the residents in question, with individual losses as great as almost NOK 5,000,000 (approx € 500,000) in Rt 2015, 276 and more than NOK 3,000,000 (approx € 300,000) in HR-2020-2021-A. The preparatory works of the Planning and Building Act emphasise the need to protect the interests of future buyers in matters relating to liability and control in building projects. These interests are at stake in a fundamental way in cases of gross negligence with the potential for significant losses for future buyers, especially when these losses are highly predictable for the tortfeasor.

129Based on this, the protection of the interests of future buyers through the general rules of tort law seemed natural in the cases from 2015 and 2020, especially when the rule of employers’ liability in skl sec 2–1 specifically takes reasonable expectations of the victim into account. Although the duties according to the Planning and Building Act are formally directed towards the government and not future buyers, future buyers have the primary interest in the fulfilment of these duties for all practical matters. This was emphasised by the Supreme Court in the cases from 2015 and 2020. The third parties in these two cases in many ways could be equalled to a victim of primary damage. It is in this sense that the conditions for liability are strict according to the previous cases, as stated by the Supreme Court in the case from 2021.

130The fundamental interests of the residents were not at stake in the same way in the new case from 2021, with individual losses of NOK 5,000 (approx € 500) for each resident. Thus, the arguments for liability in the cases from 2015 and 2020 could not be applied to the latest case.

131Still, it is possible to argue that the interests of future buyers should also be protected in less serious cases, based on the preparatory works of the Planning and Building Act. However, this is where the tension arises between the contractual rules in the House Building Act and the rules of general tort law. The Supreme Court does not seem willing to allow contractual law and the common rules of tort law to interplay on a general basis, but only in cases where the damage to the victim has especially serious consequences.

7. Personal Injury

132The most important cases regarding personal injury in the above report are the Supreme Court verdicts in HR-2021-1332-A and HR-2021-1338-A.

C. Literature

1. Endre Nåmdal, Culpanormen for prosjekterende i bygg og anlegg [The culpa rule applied to contractors in construction work], Tidsskrift for erstatningsrett (TfE) 4 (vol 17, 2021) 231–253

133In this article Nåmdal discusses a statement put forward in almost all Norwegian Supreme Court decisions regarding professional liability, according to tort law, that legitimate criticism regarding the performance of a contractual party does not necessarily equal negligence according to the culpa rule.

134However, the Supreme Court has not made it clear what is meant by this statement. Nåmdal undertakes a further analysis of the statement related to contractors in construction work.

Although the Supreme Court is not quite specific in this regard, Nåmdal argues that the statements of the Court related to legitimate criticism must be seen as a part of the established considerations of the culpa rule, and not as a separate consideration.

Based on several verdicts from the Norwegian Supreme Court, Nåmdal makes distinctions between cases where the contractor does not fulfil the contract, cases where the contractor does not act according to Norwegian law, and cases where the contractor does not fulfil duties that are not regulated by the contract.

Nåmdal concludes that it will continue to be necessary for the Supreme Court to specify that a contractor does not necessarily act negligently even in cases of legitimate criticism. This specification is necessary because it is so often emphasised in statements from the Supreme Court that the threshold for negligence is low for professionals. Specifying that legitimate criticism does not necessarily equal negligence is necessary to avoid that the threshold for negligence becomes too low.

2. Knut Martin Tande, Interessevernet i norsk erstatningsrett i lys av bori-dommen, branncelle-dommen og arkitekt-dommen [The protection of interests in Norwegian tort law according to the Bori verdict, the Fire Cell verdict and the Architect verdict], Tidsskrift for erstatningrett (TfE) 2–3 (vol 18, 2021) 65–96

135In this article, Knut Martin Tande analyses three Norwegian Supreme Court verdicts that seek to provide fundamental clarification regarding liability for defects related to building enterprises that resulted in economic losses for the residents of said buildings.

136In the so-called Architect decision in HR-2020-312-A, the Supreme Court claimed that the reasoning in the Bori decision in HR-2015-537-A, and in the Architect decision itself, is in accordance with the content of the Norwegian rules of tort law. Tande argues that this is not the case regarding the legal grounds and reasoning in the two decisions, even if the conclusions of the Supreme Court may be correct.

137Tande emphasises that it is important that the rules of common tort law are applied in a coherent and predictable way, in accordance with a large number of previous Supreme Court verdicts. Both the Fire-Cell decision in HR-2017-1834-A and the Architect decision highlight an unnecessary deviation from the approach previously used by the Supreme Court regarding what interests are protected, the use of employers’ liability according to skl sec 2–1 and the application of the rules regarding the scope of liability.

3. Estrid Nærland, Om erstatning for skadelidtes utgifter til behandling på det private marked, og hvilke krav som stilles til behandlingens effekt [Compensation for medical expenses related to the private market in cases of personal injuries], Tidsskrift for erstatningrett (TfE) 2–3 (vol 18, 2021) 97–119

138In this article Nærland discusses what is considered medically relevant expenses according to Norwegian tort law, and especially previous Supreme Court verdicts, when a victim claims compensation for expenses using the private market in cases of personal injuries.

139According to a Supreme Court verdict in Rt-2003-1358, the victim has a duty to mitigate the economic loss related to medical expences. Thus, as a starting point, victims have to use the public health system when getting treatment for personal injuries. However, if the public health system is not able to offer the relevant treatment in question within reasonable time, expenses related to the same type of treatment in the private market can be compensated.

140In addition, according to the same Supreme Court verdict, in order to be medically relevant, the medical treatment in the case at hand must be able to improve the health of the victim. More specifically, the medical treatment must have a medically documented positive effect in this regard. Even if the treatment in the end is shown to have no positive effect for the specific victim, the expenses can be compensated for a period of time while trying out the treatment. According to Nærland, in such cases the economic risk related to the medical expenses may gradually be shifted from the tortfeasor to the victim.

141However, as Nærland also points out, in Rt- 2013-1358, the Supreme Court emphasises that the courts should be careful in denying compensation for victims that receive relevant medical treatment, even if it turns out to have no effect for the victim in the case at hand.

142Based on the Supreme Court verdict in Rt-2013-1358 and other Supreme Court verdicts, Nærland concludes that it is not clear to what extent it is a condition for compensation for medical expenses that the treatment has had a positive effect for the victim, or even if it is a condition at all in most cases, as long as the treatment is medically relevant.

143There is only one case from the Norwegian Appeal Court (LG-2018-17381) where the court has stated a positive effect for the victim as a clear condition for compensation according to Norwegian tort law. In this case, the victim used an experimental treatment for cancer that was not considered medically relevant by the public health system. However, Nærland notes that this case was never brought before the Norwegian Supreme Court.

144In the last part of the article, Nærland argues that according to most principles behind the rules of tort law, a victim should get compensation for expenses related to medical treatment that is effective, even if the treatment is not considered medically relevant by the public health system.

Published Online: 2022-11-05
Published in Print: 2021-11-01

© 2021 Knut Martin Tande, published by Walter de Gruyter GmbH, Berlin/Boston

This work is licensed under the Creative Commons Attribution 4.0 International License.

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