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liability

A party is liable when they are held legally responsible for something. Unlike in criminal cases, where a defendant could be found guilty , a defendant in a civil case risks only liability. 

A party can be held liable based on their own actions, their own inactions, or the actions of people/animals for which they are legally responsible. The exact conduct necessary to hold a party liable varies based on each state’s individual set of laws. 

A liable party will likely be required to pay monetary damages , though in rare cases they may also be required to complete specific performance . 

In the event multiple parties are legally responsible for the same thing, each party’s individual responsibility depends on whether the state follows joint and several liability or several liability. 

In Delaware for example, if somebody suffered $50,000 worth of harm due to the negligence of two separate individuals, they could recover that entire $50,000 from either negligent individual because Delaware is a joint and several liability state. In a several liability state like Georgia, however, the two negligent individuals are each only responsible for covering the percentage of damage they personally caused. 

In the context of business, various methods exist to mitigate the risk of being held liable. For more information, see corporations , LLPs , LLCs . Furthermore, insurance is used by both businesses and individuals to reduce the risk of potential liability. 

[Last reviewed in June of 2022 by the Wex Definitions Team
]

Keywords

• llcs-corporations-partnerships

Wex

• accidents and injuries

• COMMERCE

• commercial activities

• LIFE EVENTS

• accidents & injuries (tort law)

• standards of tort liability

• tort damages

• THE LEGAL PROCESS

• business law

• business organizations

• contracts

• wex definitions

• business sectors

• civil procedure