Episode 7: The effective inclusion of limitations of liability in the mandate agreement
Quality-assured engagement management effectively limits liability! The effective inclusion of the limitation of liability in the client relationship should be a top priority at the start of the business relationship between the tax advisor, auditor or law firm.
Alexander Kirchner, lawyer, auditor and tax advisor at HLB Stückmann and BKS Rechtsanwälte and Felix Menze, expert for the pecuniary loss liability insurance of WP, StB and RA (StBV) from the agency Menze & Menze discuss the legal situation and give tips and assessments for practice.
When should a limitation of liability be agreed in the client relationship?
In principle, liability claims should be limited at the beginning or even in the event of a significant expansion or change in the client relationship. After the annual financial statements is definitely the wrong place.
Are there content requirements for the agreement or can it be freely formulated?
The content of the clauses should be checked and legally coordinated. CAUTION with sample forms. These are often flawed and contain the risk of surprising clauses and are therefore constantly exposed to the risk of ineffectiveness.
How high should the insurance cover in the pecuniary loss liability insurance be selected with regard to the contractual limitation of liability?
First of all, the limitation of liability should always at least correspond to the provisions of the professional regulations (WPO, StBerG, BRAO). Depending on the client or if no contractual limitation of liability is possible, the insurance cover should be adapted to the risk of the assignment.
