Tort Law in Mexico
By George Humphrey
A serious concern for any company is to suffer an accident in which people are injured or killed. Such an accident can throw a corporation into bankruptcy, ruin the company's name and cost employees their jobs. Because of such dangers, a company must be aware of the legal liabilities involved, especially when doing business in a foreign jurisdiction where laws are often radically different from those of the home country.
For foreign companies with Mexican operations, there may be liability looming in Mexico that they never knew existed. Conversely, several types of substantial liability prevalent in their home country may be insignificant or even nonexistent in Mexico. For example, punitive damages, which can double or even triple a personal injury award, do not exist in Mexico. However, Mexico has something called a "dangerous instrumentality" rule, which holds corporations liable for damages though they be neither negligent or at fault. For example, if a machine owned or operated by a company and deemed by law to be inherently dangerous, harms an individual. Dangerous instrumentalities include both machinery and substances that are inherently dangerous, such as vehicles, hazardous chemicals and gases, and electric cables. In addition, the Mexican Supreme Court has ruled that the owners of such instrumentalities are deemed liable if they authorize another person to use the instrumentality should the person then cause harm with the instrumentality. Not only heavy industrial machines are considered dangerous instrumentalities, but common automobiles as well. This means that if a company entrusts one of its automobiles to an employee, the company can be held liable should the employee injure someone.
When a person unrelated to the company is injured by the company, for instance by the leakage of toxic gas, by a plant explosion, or by a reckless employee, said person shall have cause for a tort (hecho ilícito) action against the company: a civil or private injury action. Tort actions in Mexico are governed by the civil codes of each of the states, unless there is some federal connection, such as an accident on a federal highway or with a federal officer or federal vehicle. In such a case, the Civil Code for the Federal District (Mexico City) would apply. The Civil Code for the Federal District also applies to accidents that occur within the District itself. As it is impractical to cover all state codes, and because the state codes are modeled after the federal version, this article will deal strictly with the Civil Code for the Federal District.
Besides the dangerous instrumentality rule, the other fundamental rule in Mexico for tort liability is summed up in Article 1910: "Any person who, acting unlawfully or against good custom, causes harm to another is obligated to repair the harm, unless the person can show that the harm was the result of the victim's own inexcusable fault or negligence." Fault is defined as the infliction of harm either as the result of an intentional act, a lack of caution, or as the result of negligence, and for which the law establishes liability. Another basis of liability (in addition to direct liability and strict liability for dangerous instrumentalities) is joint and several liability. Such liability allows an injured party to sue either the company's agent or the company for the total amount of the harm for the damages caused by their attorneys-in-fact and by their employees.
Once an injury is wrongfully committed, Mexican law, much more so than U.S. law, places great emphasis on repairing the harm. The objective is more to restore the injured person or repair the damaged property to its prior state, rather than to provide compensation for more subjective pain and suffering or potential future losses, as is often the tendency under U.S. law. In fact, Mexican law strictly requires the injured party to prove that the damages he or she suffered were the direct and immediate consequence of the wrongdoer's failure to show due care or use of a dangerous instrumentality.
Moreover, the Civil Code for the Federal District caps the maximum amount an injured person can receive for the actual damages he or she sustained based on the type of injury. The limitation is calculated in accordance with the current minimum wage and the rules and incapacity tables of the Federal Labor Law. In the case of a wrongful death, for instance, the most the heirs of the deceased person could presently recover would be $65,992.00 pesos (approximately US$8,800.00), while a person who has wrongfully suffered a permanent, total incapacitation would be entitled to receive up to $98,988 pesos (approximately US$13,200.00).
Some Mexican states do not have these award limitations, and instead leave the establishment of damages to the injured party. However, even in such cases, Mexican courts as a whole tend to award only minimal recoveries in comparison with United States tort actions. For example, a wrongful death suit characteristically can be worth hundreds of thousands and even millions of dollars in the United States, compared with the above-mentioned cap of approximately US$8,800 in the Federal District, plus certain other amounts.
Other than the direct harm suffered and in addition to the capped amount, an injured person is also entitled to receive compensation for his or her non-pecuniary loss (daños morales) as decided by the judge hearing the case. Non-pecuniary damages are defined as the harm that a person suffers to his or her emotions, feelings, beliefs, dignity, honor, reputation, private life, physical aspect or appearance, as well as the image that the person has before the rest of the world. Although non-pecuniary damages would include the subjective U.S. concept of pain and suffering, for example where an injured person receives compensation for the emotional trauma of witnessing the death of a loved one, most Mexican judges are extremely conservative when awarding such damages. Until some years ago, non-pecuniary losses were also capped at one-third of the amount of the actual damages in the Federal District and many states still follow this rule.
Mexican court procedures also differ significantly with the United States and can have the effect of discouraging tort actions. For example, the ability of an injured plaintiff to compel a wrongdoer to turn over documents and other potential evidence (discovery) is much more limited in Mexico. Essentially, the plaintiff must specify with exactitude the documents or evidence he or she wishes the wrongdoer to turn over, while in the United States "fishing expeditions" requesting thousands of documents only possibly related to the injury can be the norm. Further, class action suits, which are gold mines for attorneys in the United States and allow injured persons to join together against a common defendant, do not exist as such in Mexico. Mexican courts allow common sense to override tenuous, technical or convoluted legal rules when determining liability. One final difference is that in Mexico, unlike the United States, the losing party generally is required to pay the prevailing party's legal fees and expenses.
In sum, tort recoveries generally are far less than what they would be in the United States. Furthermore, because of the improbability of a significant recovery or even one that recoups the cost of bringing the suit, tort actions are, for the most part, uncommon in Mexico.
George Humphrey is a Florida Attorney and Foreign Legal Consultant with the Mexican law firm Basham, Ringe, y Correa, S.C.
