Recourse

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Recourse

Recourse means that the company having paid compensation is trying to get its money back from the person having caused the damage. Action for recourse shall always take place if there is basis in the law for doing so.

It is the individual company which is part in the case and has to claim recourse if this is possible. Recourse cases of great public importance, or cases where many parties are involved and recourse cases leading to court cases shall always be submitted to The Pool. The Board of Directors of The Pool and the Board of Directors of Statens Naturskadefond can both decide that a recourse case shall take place if there is legal basis for it.

Be aware of time limits in recourse cases.

In order to file a claim for recourse, the following conditions have to be present:

The tortfeasor must be legally liable for the damage he has done.
The company must have legal basis for claiming recourse.

The company’s claims handler must evaluate the size of the recourse claim compared to the costs of pursuing the claim.

The company’s claim has to include all costs including interests.

The basic rule in Norwegian law is that the tortfeasor is only liable if he has been negligent.(Negligence liability/culpa).  However, through court practice, areas with liability without any negligence on part of the tortfeasor,  have also been developed (no-fault or strict liability)

A number of statutory provisions and agreements regulating the liability also exist. The most relevant in connection with damages caused by natural perils are:

Produktansvarsloven
Vannresursloven (and previous Vassdragsloven)
Forurensningsloven
Lov om håndtverkertjenester.
Plan- og bygningsloven.
Agreements between the companies affecting recourse cases between them
Agreements between the parties affecting the recourse case (e.g. employment of sub- and side contractors)
FAL §§ 4-9 and 7-6

The list is not complete.

Be also aware of the fact that

There must be a certain connection between the act and the damage (causal connection)
There is also a limit for which loss and damages are compensatory (adequate causation)
Considerations must be done whether the damage is an expected consequence of the tortious act.
An evaluation must also be done whether there is an economical loss (this is an absolute condition)
 
Be aware of the limitations to claim recourse when an insurance exists, cf § 4-2  no 1 of Skadeerstatningsloven:

“To the extent it is obvious that a damage will be compensated under an insurance 
    covering damage to objects or other financial loss, the claimant can only claim
    compensation from the tortfeasor if the damage is caused by
a) willful misconduct or gross negligence by the person being liable or
b) in his occupation, trade or similar activity”
   
 
Be also aware of the company’s legal authorization of recourse is to be found in § 4-3 of Skadeerstatningsloven: 
“To the extent the company through an insurance covering either physical damage to  
objects or other financial loss has paid compensation to the Claimant, it can claim 
recourse from the liable tortfeasor to the same extent as the claimant could have 
claimed compensation according to § 4-2.”

The boroughs have a very important part in the picture as regulating-and approving authorities. In particular 3 situations have importance when considering recourse against boroughs.  This concerns regulation and approval of construction in:

areas exposed to landslides or avalanches.
areas exposed to flooding
areas exposed to storm surge.

The boroughs might incur liability either because of lack of investigations or for not having had due regard to possible risk of damage caused by natural perils. Under certain circumstances, the boroughs may have given preference to easily accessible and cheap building locations without giving the risk of natural disasters sufficient consideration.

The companies will also have to consider a possible recourse against “other” liable third parties than the boroughs.  In relationship to the operators three different basis for liability are relevant:

Liability based on negligence.
Legal strict liability
Non-statutory strict liability

See also an opinion from the firm of solicitors Arntzen de Besche about “Liability for damage caused by Water- and Sewerage Plants”

The opinion is to be found as enclosure 25.