Return to all questions

Return to all questions

The agent from the management contract (order) commissions a renovation exceeding the budget and without consulting the client, and this is then poorly executed by the craftsman. Does the client have a claim for damages against the agent?

March 14, 2025

Contract law

Open in Omnilex

Yes, the client may have a claim for damages against the contractor. According to the relevant considerations, the following legal bases and considerations arise:

1. Contract Violation and Non-compliance with Instructions: The contractor is bound by the instructions of the client and may only deviate from them if seeking a permission is not feasible and it is assumed that the client would have granted the permission with knowledge of the circumstances (Art. 397 Abs. 1 OR). If the contractor deviates from these provisions to the detriment of the client without meeting these conditions, the contract is considered fulfilled only if the contractor bears the resulting detriment (Art. 397 Abs. 2 OR; gerichte-zh.ch/themen/auftrag/rechte-und-pflichten.html 2, 4). 2. Liability for Negligence: The contractor is liable to the client for faithful and careful execution of the business assigned to her (Art. 398 Abs. 2 OR). This liability standard is comparable to that of an employee in an employment relationship, with the expectation that a higher level of care is required from the contractor as a specialist (Art. 398 Abs. 1 OR; gerichte-zh.ch/themen/auftrag/rechte-und-pflichten.html 3). 3. Liability for Damages:

According to Art. 97 Abs. 1 OR, the debtor must compensate for damage arising from the improper fulfillment of an obligation, unless he proves that he is not at fault. In this case, the burden of proof for the contract violation, damage, and causal connection rests with the client (4A_404/2023; 4A_283/2023).

In summary, it can be said that the contractor violated her duties by commissioning the renovation without the client's consent, and the contractor executed it inadequately. The contractor is liable for the resulting damages, provided the contract violation was causal for these damages and no exculpation evidence is provided. The client therefore potentially has a claim for damages against the contractor (Art. 398 Abs. 2 OR in conjunction with Art. 97 Abs. 1 OR; 4A_404/2023; gerichte-zh.ch/themen/auftrag/rechte-und-pflichten.html 2).

Sources

Federal Act of March 30, 1911, on the Supplement to the Swiss Civil Code (Fifth Part: Law of Obligations) > Second Section: The individual contractual relationships > Thirteenth Title: The Mandate > First Section: The simple mandate > C. Effects > II. Obligations of the Mandatary > 1. Proper execution

Art. 397 para. 1 OR

1 If the mandator has provided a provision for the completion of the assigned business, the mandatary may only deviate from it to the extent that, under the circumstances, obtaining permission is not feasible and it can be assumed that the mandator would have granted it if aware of the situation.

Art. 397 para. 2 OR

2 If the mandatary deviates from the mandator’s provisions to the detriment of the mandator without these conditions being met, the mandate is considered fulfilled only if the mandatary bears the resulting disadvantage.

Federal Act of March 30, 1911, on the Supplement to the Swiss Civil Code (Fifth Part: Law of Obligations) > Second Section: The individual contractual relationships > Thirteenth Title: The Mandate > First Section: The simple mandate > C. Effects > II. Obligations of the Mandatary > 1. Proper execution

Art. 397 para. 1 OR

1 If the mandator has provided a provision for the completion of the assigned business, the mandatary may only deviate from it to the extent that, under the circumstances, obtaining permission is not feasible and it can be assumed that the mandator would have granted it if aware of the situation.

Art. 397 para. 2 OR

2 If the mandatary deviates from the mandator’s provisions to the detriment of the mandator without these conditions being met, the mandate is considered fulfilled only if the mandatary bears the resulting disadvantage.

Rights and Obligations in the Contract - Courts ZH

gerichte-zh.ch/themen/auftrag/rechte-und-pflichten.html 2

According to Art. 394 para. 1 OR and Art. 396 OR, the agent is obliged to perform the contract in accordance with its terms. She is bound by the instructions of the principal. Depending on the content of the contract, the duty of loyalty (lawyer, tax advisor) or trust (doctor) is of particular importance. Accordingly, the agent is obligated to safeguard the interests of the principal and is subject to a duty of confidentiality regarding what has been entrusted to her (see also Art. 321 StGB).  

gerichte-zh.ch/themen/auftrag/rechte-und-pflichten.html 3

As for the required level of care, Art. 398 para. 1 OR refers to the liability of the employee (Art. 321a/321e OR). However, the agent as a specialist is generally liable more strictly than an employee, as one would usually expect her to possess the necessary knowledge and skills for her activity. The circumstances of each individual case are always decisive.   Refer to the practical examples: BGE 117 II 563; 119 II 249; 119 II 333; 119 II 456; 124 III 155; 127 III 357.   A contractual limitation of liability for simple negligence is generally permissible (Art. 100 para. 1 OR).  

gerichte-zh.ch/themen/auftrag/rechte-und-pflichten.html 4

According to Art. 398 para. 3 OR, the agent must personally attend to the business unless she is authorized to transfer it to a third party or is compelled by circumstances, or if representation is usually considered permissible (so-called substitution; see Art. 399 OR). According to Art. 399 para. 2 OR, the agent is then only liable for careful selection and instruction of the substitute.   Finally, the agent must adequately inform the principal about her activities and the associated chances and risks. At the request of the principal, she must provide an account at any time.  

Rights and Obligations in the Contract - Courts ZH

gerichte-zh.ch/themen/auftrag/rechte-und-pflichten.html 2

According to Art. 394 para. 1 OR and Art. 396 OR, the agent is obliged to perform the contract in accordance with its terms. She is bound by the instructions of the principal. Depending on the content of the contract, the duty of loyalty (lawyer, tax advisor) or trust (doctor) is of particular importance. Accordingly, the agent is obligated to safeguard the interests of the principal and is subject to a duty of confidentiality regarding what has been entrusted to her (see also Art. 321 StGB).  

gerichte-zh.ch/themen/auftrag/rechte-und-pflichten.html 3

As for the required level of care, Art. 398 para. 1 OR refers to the liability of the employee (Art. 321a/321e OR). However, the agent as a specialist is generally liable more strictly than an employee, as one would usually expect her to possess the necessary knowledge and skills for her activity. The circumstances of each individual case are always decisive.   Refer to the practical examples: BGE 117 II 563; 119 II 249; 119 II 333; 119 II 456; 124 III 155; 127 III 357.   A contractual limitation of liability for simple negligence is generally permissible (Art. 100 para. 1 OR).  

gerichte-zh.ch/themen/auftrag/rechte-und-pflichten.html 4

According to Art. 398 para. 3 OR, the agent must personally attend to the business unless she is authorized to transfer it to a third party or is compelled by circumstances, or if representation is usually considered permissible (so-called substitution; see Art. 399 OR). According to Art. 399 para. 2 OR, the agent is then only liable for careful selection and instruction of the substitute.   Finally, the agent must adequately inform the principal about her activities and the associated chances and risks. At the request of the principal, she must provide an account at any time.  

Federal Act of March 30, 1911 on the Supplement to the Swiss Civil Code (Fifth Part: Law of Obligations) > Second Section: The Individual Contractual Relationships > Thirteenth Title: The Mandate > First Section: The Simple Mandate > C. Effects > II. Obligations of the Mandatary > 2. Liability for Faithful Execution > a. In General

Art. 398 para. 1 OR

1 The mandatary is generally liable for the same care as an employee in an employment relationship.

Art. 398 para. 2 OR

2 He is liable to the client for faithful and careful execution of the business entrusted to him.

Art. 398 para. 3 OR

3 He must personally carry out the business, unless he is authorized to transfer it to a third party or is compelled by circumstances, or unless representation is generally considered permissible.

Federal Act of March 30, 1911 on the Supplement to the Swiss Civil Code (Fifth Part: Law of Obligations) > Second Section: The Individual Contractual Relationships > Thirteenth Title: The Mandate > First Section: The Simple Mandate > C. Effects > II. Obligations of the Mandatary > 2. Liability for Faithful Execution > a. In General

Art. 398 para. 1 OR

1 The mandatary is generally liable for the same care as an employee in an employment relationship.

Art. 398 para. 2 OR

2 He is liable to the client for faithful and careful execution of the business entrusted to him.

Art. 398 para. 3 OR

3 He must personally carry out the business, unless he is authorized to transfer it to a third party or is compelled by circumstances, or unless representation is generally considered permissible.


Previous question

Next question