Have you paid for the damage but feel that you did not cause it? Or is your insurance company, employer or the state demanding money back in the form of recourse compensation? Recourse compensation is one of the most common, but also one of the least understood legal institutions. In this article you will learn when recourse is justified, when you can defend yourself and how to proceed to avoid losing tens of thousands of crowns unnecessarily.
Recourse compensation is when a person who is obliged by law to pay for the damage on behalf of another, after having paid the damage, claims compensation from the person who actually caused the damage under the conditions set by law. Typically, a recourse claim occurs when an insurance company, employer, state or municipality first pays the damages but then seeks to recover the amount from the person who caused the damage.
A recourse claim is not between the injured party and the plaintiff, but between the person who paid the damages and the person who is liable. However, this is without prejudice to the original liability of the tormentor towards the injured party. The legislation is based in particular on the Civil Code or on special provisions (for example, labour law or insurance law).
A typical feature of a recourse claim for damages is that:
It is the assessment of these conditions that is key and often determines whether or not you pay.
We will investigate the recourse claim, represent you in negotiations with the insurance company and help reduce or deny the amount.
People encounter recourse damages more often than they think. Some of the most common situations include the following:
Car accidents and insurance companies
The insurance company will pay the injured party for the damages, but may subsequently make a recourse claim against the driver. Typically, for example, if the driver:
An example from our practice: a client caused a traffic accident, the insurance company paid the damage in the amount of CZK 310,000 and subsequently claimed recourse compensation. However, after a legal assessment, it turned out that the causal link between the breach of duty and the damage was not proven. Thus, the client did not have to pay anything.
Employer’s recourse against the employee
An employer is liable for damage caused by an employee to a third party. If it pays the damages, it can claim recourse against the employee under certain conditions.
However, beware – the employee is only liable for damages caused by negligence up to the statutory limit. If the damage is caused by negligence, the employer can claim compensation up to a maximum of four and a half times the employee’s average monthly earnings. However, this limitation does not apply in all cases – in particular, it does not apply if the damage was caused intentionally, under the influence of alcohol or drugs, or if there is a deficit in entrusted values or loss of entrusted objects. In practice, however, employers often do not respect these differences.
Health insurance companies’ recourse
A health insurance company may seek recourse for costs incurred for covered medical care if the injury was caused by another person. Typically, this involves car accidents, fights, or work-related injuries.
State or municipal recourse
The state or municipality may pay the injured party and then seek recourse against the responsible party. These cases tend to be legally very complex and risky without professional help.
If you receive a recourse notice, never ignore it, but don’t automatically pay it either.
A claim for recourse compensation is only justified if all the legal conditions are met. A mere allegation by the insurer or employer is not enough.
As a rule, recourse is justified if:
On the other hand, recourse damages are unjustified if:
Insurance companies and other institutions often claim automatically. This does not mean that they are always justified.
If you receive a claim for recourse damages, it is important to proceed with caution and not be pushed into acting rashly. The first and fundamental rule is: do not pay without legal advice. The fact that your insurance company, employer or other entity has sent you a demand for payment does not mean that the recourse claim is legitimate. In practice, it is very often the case that recourse is claimed automatically, without a thorough assessment of the specific circumstances of the case.
Ask for detailed information before making any comment on the claim. You have the right to know on what legal basis the claim is being made, how the amount of the damage has been determined and on what evidence you should be held liable. Without this information, it is impossible to assess whether the legal conditions for recourse compensation are met, in particular whether there is fault, causation and whether the amount claimed corresponds to the actual damage. It is often at this stage that a recourse claim is found to be based on incomplete or disputed documents.
It is also an important step to check whether the claim is time-barred. Even legitimate recourse can be refused if it is made after the statutory time limit has expired. However, institutions do not always take the statute of limitations into account on their own and rely on the addressee of the challenge not to address the issue. If you do not raise a limitation objection in time, your defence may be significantly weakened.
Particular caution is advisable in any communication with the counterparty. Do not sign acknowledgements of debt or other documents without consulting an attorney. Even a seemingly innocent statement, an attempt to “calm the situation” or an admission of partial liability can be construed as an admission of recourse. Doing so could significantly worsen your legal position and deprive you of an effective defense.
One hasty statement or early payment may mean that you effectively accept a recourse claim, even though there may not have been a legal reason to do so in the first place.
We will professionally investigate the recourse claim for you, assess its validity and take over communication with the insurer or employer. In a large number of cases, we are able to deny recourse entirely or significantly reduce it.
Tip: Non-pecuniary damage is one of the most frequent claims made by victims after car accidents, medical procedures, work injuries and criminal offences. It is an interference with health, honour, privacy or human dignity that cannot be easily quantified. But how do Czech courts determine the amount of compensation? Read our article.
Not only insurance companies, employers or other institutions, but also individuals can make a recourse claim for damages. Typically, this is where you have paid the victim even though you did not cause the damage or were only formally responsible for it. This is most often the case when you were legally liable to the injured party, but another person was the actual cause of the damage. An individual can only have recourse if the law allows them to do so or if they were legally liable for the damage.
In order to successfully claim recourse, you must first prove that you actually paid for the damage and in what amount. At the same time, you must prove that the person against whom you seek recourse is liable, i.e. that it was his or her actions that led to the damage. It is also important to comply with the statutory time limits, as even an otherwise legitimate recourse claim may become unenforceable in court due to the statute of limitations.
Claiming recourse damages can be legally and evidentially challenging, especially if the other party denies liability. We can help you properly prepare, pursue and, if necessary, litigate your recourse claim to maximize your chances of success.
Just one YES and we recommend a legal consultation.
While recourse is a legal institution that allows you to claim back money from someone who has paid the damages on behalf of another, typically an insurance company, an employer, the state, or even an individual, recourse to damages arises only after the damages have been paid and is never automatic – legal conditions must always be met, in particular the existence of fault, causation, a reasonable amount of damages, and compliance with time limits. Recourse damages are most often encountered in car accidents, work-related claims, health insurance recourse or claims by the state and municipalities, for example, whereby the employee is generally not liable without limit and his liability is limited in the case of negligence, although employers often do not respect these limits. If you receive a recoupment notice, it is not advisable to ignore it or automatically pay it, as recoupment may be unwarranted, time-barred or overstated; the key is to ask for the legal reason, calculation of damages and evidence, communicate carefully and do not sign an acknowledgement of debt without legal advice. Not only can a recourse claim be denied or reduced, but it can also be reversed in your favour if you have paid the damages on someone else’s behalf and another person was the actual originator, and success depends on correct legal assessment, evidence and compliance with time limits – which is why it pays to contact a solicitor in most of these cases.
The insurer can make a recourse claim, but not automatically and without meeting the legal conditions. It must prove that you caused the damage culpably, that there is a causal link between your actions and the damage and that the amount claimed corresponds to the actual damage. In practice, insurers often apply recourse across the board without all these conditions being met.
A recourse claim for damages is subject to the statute of limitations. The statute of limitations varies depending on the specific situation and the law, but if the claim is filed after the statute of limitations has expired, you can successfully defend yourself with a statute of limitations defense. However, if you do not assert it in time, the recourse may remain recoverable even if it is already time-barred.
No. A demand for payment does not in itself imply an obligation to pay the recourse. It is advisable to have the claim professionally assessed first as it may be unjustified, partially unfounded or overstated. Premature payment or acknowledgement of the debt could deprive you of an effective defence.
Only in exceptional cases. In the case of damage caused by negligence, the employee’s liability is limited by law, usually to four and a half times his average monthly earnings. Full compensation can be claimed, for example, in the case of intentional damage, damage caused by alcohol, or deficits in entrusted values.
Yes. Even recourse damages of tens of thousands of crowns can be legally complex, and the wrong procedure can lead to unnecessary financial loss. In many cases, all it takes is a professional legal assessment or properly managed communication to have a recourse claim denied altogether or significantly reduced.
Get compensation for harm or damage – quickly and without stress. We will assess your chances, propose a strategy and prepare a challenge. All within 48 hours of placing your order. If necessary, we will then file a lawsuit and arrange legal representation. We will stand up for you fully.
Ondřej is the attorney who came up with the idea of providing legal services online. He's been earning his living through legal services for more than 10 years. He especially likes to help clients who may have given up hope in solving their legal issues at work, for example with real estate transfers or copyright licenses.
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