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What is Liability?

Updated on May 5, 2010

Personal Liability, in its technical legal sense, denotes a legally enforceable responsibility as against merely moral obligation. More specifically, personal liability means the state of a person after he has breached a contract or broken any legal duty that rests upon him individually.

Classes of Personal Liability

Personal liability may be classified in ways that include the following: (1) by the category of law that applies, civil or criminal; (2) by the kind of liability, whether purely personal, that is, referring to liability for one's own acts, or imputed, meaning liability imposed by law (such as the liability of an employer for negligence of his employee on the job); (3) by the source of the applicable law, either court decisions or legislative enactments; (4) by the origin of the obligation, either contractual, in a situation based on an agreement, or tortious, that is, stemming from a wrong done by the person who is liable to the person who is injured.

Principal Types of Personal Liability

Theoretically, there is an almost infinite variety of ways in which a person may become legally liable. The main types of liability for damages include assault; attractive nuisance on one's property that results in injury to a child; battery; breach of contract; violation of contract through willful injury or fraudulent misrepresentation; defamation; false arrest or false imprisonment; and fraud.

Other frequent types are interference with business activities, a contract, or family relations; infliction of mental distress; invasion of privacy; malicious prosecution; nuisance (that is, producing an annoying or injurious element, especially on real property); products liability toward consumers; trespass, either to chattels or to land; unfair competition; waste or abuse of real property belonging to another; and wrongfully causing the death of another person.

Most of the foregoing types of personal liability are based on common law court decisions. However, statutory provisions sometimes apply. Thus, a shareholder can be personally liable, in certain situations, for his corporation's debts. For example, he may become personally liable to the extent of the par value of his stock holding or for double that amount, as the statute may provide.

Again, tax statutes make a wife personally liable with her husband for omissions on their joint tax returns prepared by him, even though she knew nothing of his tax evasion. Corporation officers may be held personally liable for wrongs done by their companies if the officers directed, aided, or abetted wrongdoing by agents of the corporation.


By the mid-20th century, personal liability had become wider and stricter in the United States. The dominant tendencies now are those that aim toward protection of consumers and rejection of doctrines of immunity. For example, the ancient rule of caveat emptor (let the buyer beware) is fading. The ancient privileged-rights status of landlords or landowners, versus tenants or the public, is being replaced by laws favoring tenants and public interests. Privilege is becoming ever harder to maintain, while personal liability for conduct that injures public or individual interests is growing.


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    • Gretchen Ferce profile image

      Gretchen Ferce 5 years ago from Arizona, USA, 85640

      I appreciate the details from this hub. there are individuals who are having hard time in understanding details involving liabilities and claim settlements.

    • thevoice profile image

      thevoice 7 years ago from carthage ill

      detailed quality hub work thanks