An extract from The Professional Negligence Law Review, 3rd Edition

Introduction

Under Mexican law, professionals are obliged to act diligently in accordance with their expected skills. Individuals are bound by a general duty of care; however, Mexican law recognises, in statute and precedent, that professionals are held to a higher standard. Regardless of whether professional service obligations arise from a contract, professionals are liable if they fail to observe this higher standard of diligence.

The first part of this chapter sets out the general legal framework applicable to professional liability. To that end, it explains the different types of liability that individuals may face in the exercise of their profession, the procedures applicable when claims of professional liability are brought, and the direct and immediate damages and lost profits that the service receiver may recover for the professional's misconduct.

The second part of this chapter sets out examples of professions with particular regulations, authorities and sanctions; these laws generally relate to areas of social interest and public policy.

Finally, the chapter outlines recent and future developments with respect to case law derived from the recent Mexican educational reform, the new regulation on corporate liability, the possible introduction of punitive damages in Mexico, the increasing attempts to make bar association affiliation mandatory, the effects of the 'new' corporate liability and the tendency towards orality in judicial proceedings.

i Legal framework

Article 5 of the Mexican Constitution provides for the right to perform any profession, industry, business or work. This right may only be revoked by a court decision or by government order when third parties' rights or society's rights are infringed, respectively. Thus, the right to perform a profession contains certain limits and restrictions.

According to the Regulatory Law of Article 5 of the Mexican Constitution concerning the Exercise of Professions in the Federal District (the Regulatory Law), which applies to professionals in Mexico City and on a federal level, a professional service includes the rendering of any service specific to a particular profession, and includes the use of cards, announcements, plaques, badges or other means to indicate the characteristic features of a particular profession.

To exercise a profession, the individual is required to: (1) be in full exercise of his or her civil rights; (2) hold a duly registered degree; and (3) hold a permit to exercise the profession issued by the General Directorate of Professions. A professional is obliged to put all scientific knowledge and technical resources into practice at the service of their clients, as well as to perform the work that was agreed upon by the parties. Also, a professional is obliged to keep strict secrecy regarding the matters entrusted to them. Unlike in other countries, Mexican law does not provide for mandatory allegiance to a bar association.

Individuals may exercise their profession on their own or as employees. Professionals who exercise their profession as employees are subject to the Federal Labour Law. Governmental professional employees are also subject to other administrative laws.

In the exercise of their profession, individuals are subject to the applicable laws – whether general or specific to their professions (e.g., lex artis)– as well as to the contracts they conclude with the service receivers. Professionals should act diligently in accordance with their professions. Breaches of contract or of law expose them to different types of liability.

Civil liability

All 32 states of the Mexican Republic have their own civil code, most of which mirror the Civil Code of Mexico City. Also, all 32 states have their own code of civil procedure. The Federal Civil Code of Mexico (the Federal Civil Code) serves as gap filler for federal laws, but the regime it promulgates is almost identical to that of the Civil Code of Mexico City. For the purposes of this chapter, we will refer to the provisions of the Federal Civil Code, which are almost identical to the local civil codes.

Article 1910 of the Federal Civil Code establishes that anyone acting unlawfully or against good practices who causes damage to another shall repair the damage. This Article enhances the core premise of civil responsibility. Under this premise, civil liability arises whenever the following elements are met: (1) commission of an unlawful act; (2) direct and immediate damage; and (3) a causal relationship between the unlawful act and the damage caused.

Acts are unlawful when they violate a specific legal rule or good customs. Mexican law requires that damage must be the 'direct and immediate' consequence of the unlawful act. Mexican case law has dealt with what should be understood by the terms 'direct and immediate'. The benchmark is that the damage will be the direct and immediate result of a cause when it is the 'effective cause'. The effective cause analysis states: had the unlawful act not occurred, the damage would not have occurred.

Civil liability may arise from two sources: contractual liability and extra-contractual liability (known as 'tort' in other jurisdictions).

Contractual liability

Contractual liability derives from a breach of an agreement or contract. As a general rule, the parties to a contract may agree on the terms and obligations that they freely choose, as long as the subject matter is lawful. However, the law also establishes certain limitations to the freedom of contract taking into consideration the nature of the contract and the rights at stake.

For example, with respect to professional services, the Federal Civil Code provides that the individual who exercises any profession without the proper licence will lose the right to charge remuneration for the professional services rendered. Also, when a professional can no longer render services, he or she should promptly notify the client and will still be liable for damage and loss of profits caused by the withdrawal of the services.

A claim on breach of contract has two main requirements: (1) that the non-breaching party is in compliance with its obligations under the relevant contract to seek relief (i.e., 'clean hands'); and (2) that the breaching party has indeed breached the contract.

Extra-contractual liability

Extra-contractual liability under Mexican law may be considered as premised on the principle of alterum non laedere, which states that everyone has the duty not to inflict harm upon others.

Therefore, extra-contractual liability or tort may arise independently of any contractual relationship between the parties. Extra-contractual liability may be: (1) objective, which exists independently and the conduct of the agent was not guilty or negligent; and (2) subjective, which necessarily constitutes unlawful, negligent and damaging conduct.

The degree of guilt or fault will be determined depending on the type of responsibility or duty of care that the agent has towards the victim. In Mexican law, there are several types of guilt. The degrees of guilt are not defined in statute but are referenced in precedent and doctrine.

Guilt stricto sensu exists whenever the damage would have been foreseeable and could have been avoided had the agent acted diligently. Wilful misconduct exists when the agent intentionally wants to damage the victim. Gross negligence constitutes extreme negligence, recklessness or incompetence, for not being able to foresee or understand what a normal person foresees or understands, omitting the most elemental care, diligence, etc. Ordinary negligence is the omission of diligence of an ordinary person in the conduct of his or her affairs; and slight negligence, is the omission of diligence of a person who is extremely diligent.

The professional should be diligent in accordance with his or her expected professional skills. For example, in a recent precedent, the Supreme Court found employees of a school liable for damage caused by bullying between students, since the teachers were expected to act diligently and in accordance with their profession, which includes actively preventing and detecting any acts of bullying. There was a subsequent decision by the Supreme Court that found that schools and their staff have the obligation to generate an adequate school environment and create instruments to protect the students against bullying.

Specifically, the Supreme Court ruled that the unlawful act was the consequence of two sources: (1) the breach of an obligation to act in accordance with a certain legal provision; and (2) the breach of a general duty of care expected of a professional.

Coexistence of contractual and extra-contractual liability

The Mexican Supreme Court rendered a decision whereby it recognised that a contractual and extra-contractual liability may coexist when dealing with medical malpractice. The Supreme Court reasoned that even if the patient has a social security contract or a contract for professional services with a physician, the doctor is still bound to act diligently in accordance with his or her profession. In this case, the Supreme Court found that even where the patient had given consent regarding the administration of anaesthesia, damage caused by the negligent administration of this medical component gave rise to an extra-contractual liability or tort independent of the contractual relationship between the parties.

In a different decision, the Supreme Court also established that, in a contractual relationship, the client can accept certain risks regarding the rendering of the services. However, if the harmful event occurs because of the negligence or omission by the service provider, there will be extra-contractual liability, since that damage cannot be accepted in a services agreement.

Liability for lack of diligence in professional services

Apart from identifying whether a contractual or extra-contractual liability may arise within a professional service relationship, it is important to assess who is the responsible individual.

Article 2615 of the Federal Civil Code establishes that whoever renders professional services is only liable towards the persons that he or she is serving, for negligence, lack of skill or wilful misconduct, regardless of sanctions that may apply in the event of a crime.

This legal provision can be construed in different ways: the first is that a professional is not liable to third parties that are not clients; the second is that a professional is liable to clients only for negligence, lack of skill or wilful misconduct. There is no legal precedent that answers this question.

However, to obtain relief under a suit for damage and lost profits arising out of negligence, a claimant has to prove that the defendant had a duty of care, that the alleged negligent actions of the defendant breached the duty of care, and that the actions resulted in, as a direct and immediate consequence, the damage and lost profits that the plaintiff is seeking, otherwise a Mexican court would not find for the plaintiff. Plaintiffs will need to demonstrate the necessary connection between the alleged negligent action or omission and the direct and immediate damage and lost profits. The available types of damages and redress for lost profits are explained in Section I.iv.

Criminal liability

Title XII of the Federal Criminal Code of Mexico considers that certain conduct or acts constitute a crime within the arena of professional responsibility. Chapter I of Title XII provides that professionals, artists or technicians and their assistants will be responsible for crimes committed in the exercise of their profession, and without prejudice to liability contained in regulations applicable to the specific profession. The individuals who commit such crimes are subject to, among other things: (1) one month to two years' suspension from exercising the profession, and (2) reparation of the damage caused. This is applicable to physicians who without cause stop the treatment of an injured or sick person.

The directors, managers or administrators of any health centre may be subject to imprisonment (of two months up to two years) and fines for any of the following conduct: (1) preventing the departure of a patient, when he or she or family members request it, on account of debts of any kind; (2) unnecessarily retaining a newborn, on account of debts of any kind; or (3) delaying or denying for any reason the delivery of a corpse – except when an order from a competent authority is required. The same sanctions apply to managers, employees or dependants of a pharmacy who substitute medicine specifically prescribed with another medicine that causes damage or is evidently inappropriate for the condition for which the original medicine was prescribed.

Chapter II provides that lawyers, representatives and litigators are subject to penalties, including two to six years' imprisonment, fines and disqualification or suspension from the exercise of their profession for two to six years if they engage in the following conduct:

  1. allege false facts or non-existent or repealed laws;
  2. use certain illegal dilatory tactics;
  3. base their action or defence on false or worthless documents or witnesses; or
  4. simulate a legal act or writ, alter evidence and present it at trial, to obtain a ruling, resolution or administrative act contrary to the law.

In addition to the above-mentioned sanctions, lawyers, representatives and litigators may be subject to three months' to three years' imprisonment for:

  1. sponsoring or assisting diverse contenders or parties with opposing interests, in the same or a related business;
  2. abandoning the defence of a client or business without just cause; and
  3. accepting the position of defence counsel but merely requesting the cautionary freedom of his or her client without presenting further evidence.

Chapter VII of Title XIII of the Federal Criminal Code of Mexico, among other things, regulates conduct and applicable sanctions in connection with the exercise of a profession without the corresponding title or authorisation issued by the competent authorities. The applicable sanctions for this crime range from one to six months' imprisonment and a fine.

Moreover, the Regulatory Law also provides several kinds of conduct or acts that constitute a crime by professionals or individuals who present themselves as professionals. The Regulatory Law provides administrative sanctions for these crimes; however, while describing criminal conduct, this Law almost always refers to the applicable articles of the Federal Criminal Code of Mexico with reference to a specific type of conduct and the corresponding sanction. However, criminal sanctions may also be provided for in legislation other than the criminal codes (see Section II for legislation applicable to specific professional activities).

Administrative liability

Administrative liability may also arise in certain cases. Some professions (e.g., the medical and finance professions) are regulated by their lex artis, which establishes specific obligations, competent authorities and sanctions. Specifically, all health industry professionals, technicians and auxiliaries who provide medical services in the public and social security sectors are subject to administrative liability.

In addition, individuals may exercise their profession on their own account or as employees. Professionals who exercise their profession as employees are subject to the Federal Labour Law. Public officers are also subject to other administrative laws.

ii Limitation and prescriptionCivil claims

As a general rule, and unless specified as an exceptional case, the right to enforce a judicial action is only extinguished upon the expiry of a 10 year-term from the date on which the right became effective.

Notwithstanding this, a two-year statute of limitations applies to civil liability arising from unlawful acts that do not constitute a crime.

Both Article 1161-V and Article 1934 of the Federal Civil Code provide a two-year statute of limitations for claims arising from unlawful acts. However, pursuant to Article 1161-V, the statute of limitations starts running on the day that the act takes place, while according to Article 1934 the statute of limitations starts running on the day that the damage is caused. Therefore, these provisions are apparently contradictory.

While analysing Article 1934 of the Federal Civil Code, the Mexican Supreme Court issued a binding precedent stating that it is necessary to consider the moment at which the affected person becomes aware of the damage so caused for the statute of limitations to start running. Therefore, it seems that Article 1934 of the Federal Civil Code should apply with respect to when the statute of limitations starts to run.

In addition, the Supreme Court has also established (in non-binding precedent) that the two-year statute of limitations is only applicable to patrimonial damages. However, when the damage is caused to life or integrity, the applicable statute of limitations must be the general rule (i.e., 10 years).

Criminal claims

The Federal Criminal Code establishes specific rules for the statute of limitations of crimes. There are four main criteria for the determination of the statute of limitations in criminal actions:

  1. for crimes punishable only by a fine, the statute of limitations for a criminal action expires after one year;
  2. for crimes punishable by imprisonment, the statute of limitations is equal to the arithmetical average punishment term;
  3. for crimes punishable only by removal from post, suspension or disqualification from office, the statute of limitations is two years; and
  4. for crimes that can only be prosecuted following a complaint by the aggrieved party, the statute of limitations for a criminal action expires after one year.

These terms may vary according to the applicable lex artis.

iii Dispute fora and resolution

As noted in the previous sections, professional liability is mainly governed by civil law and, to a lesser extent, by provisions in criminal law for specific crimes.

In this context, professional liability claims arising from contractual or extra-contractual liability should be brought before a civil court in the state in which the offence was committed. Likewise, the commission of a crime must be heard by a criminal court.

Nonetheless, Mexican case law dealing with professional liability is largely based on medical malpractice.

In light of the growing number of lawsuits against doctors, the Mexican government decided, in June 1996, to create, by a presidential decree, an independent national institution attached to the Ministry of Health to resolve conflicts between doctors and patients using alternative dispute resolution methods with the intervention of medical experts – the National Medical Arbitration Commission (CONAMED). As a result, the majority of professional liability claims alleging medical malpractice are brought before CONAMED.

CONAMED deals only with acts or omissions derived from the rendering of health services and medical malpractice. It does not have the authority to decide matters involving the commission of crimes, matters that are already being litigated in civil courts, labour matters, or matters in which the only relief sought is the penalisation of the medical professional.

Professional liability claims brought before CONAMED are decided through arbitration, in accordance with the CONAMED Rules of Procedure for the Attention of Medical Complaints. As the process takes the form of an arbitration proceeding, an arbitral agreement is required for a complaint to be resolved by CONAMED.

The proceeding before CONAMED begins with a conciliatory stage. If the parties do not reach an agreement, CONAMED presents a settlement proposal. If a settlement is not possible, CONAMED, or another person appointed as arbitrator, decides the arbitration through an arbitral award, which, despite not being a judicial resolution, has the authority of res judicata.

All proceedings (arbitral proceedings or proceedings of a different nature) are free of charge.

There are also some recent precedents regarding the burden of proof on medical negligence cases. In 2016, a circuit court ruled that, since the state is bound to protect the human right to health, it is the burden of the Mexican Social Security Institute to prove that its medical staff provided the patient with the adequate treatment. There is a similar precedent for all medical professionals by the Mexican Supreme Court that states that there is a reversal of the burden of proof where the medical professional must prove their diligent action.

iv Remedies and loss

Under the Federal Civil Code, the governing principle in damages cases consists in the restoration of the damaged item to its previous condition. If restoration is impossible, the responsible party must then pay for the corresponding damage and losses.

'Damage' is the loss or lessening of someone's patrimony as a result of a failure to comply with an obligation, and 'loss' is the preclusion from obtaining lawful gains that would have been received in the future if the unlawful act had not taken place.

Damage and losses must be the direct and immediate consequence of the failure to comply with the obligation, whether they have already occurred or will necessarily occur.

Civil liability may be entirely regulated by the contract between the parties, except for liability for damage caused by gross negligence. The parties may stipulate in the contract a set penalty (in the form of compensation) whenever certain contractual obligations are not met as set out in the contract and are, therefore, breached. Therefore, Mexican law permits limitation of liability clauses. These clauses are normally valid, unless bad intent is found, which could render the clause null and void.

The Federal Civil Code stipulates that, in the presence of conventional penalties, the non-breaching party cannot seek other compensation for damage and losses, but can only obtain the compensation specified in the agreed clause.

Reparation for moral damage is also available for the victim. Moral damage is understood as the detrimental impact suffered by a person in her or his feelings, affections, appearance, honour, reputation, private life, physical integrity and physical aspect, or in the opinion that others have of him or her. When an unlawful act causes moral damage, the offender has the obligation to repair it by means of monetary compensation. This is independent of any other compensation that may arise as a result of material damage.

In a moral damage claim, in determining the amount of the monetary compensation, the judge takes into account the nature of the injury, the degree of responsibility and the economic situation of the offender and the victim, as well as other circumstances of the case.

Although, under Mexican law, damages have traditionally been limited to compensatory damages, in a tort case decided by the Mexican Supreme Court in 2013 (the Mayan Palace case) moral damages were awarded to compensate a victim for the 'damage so suffered'. The Supreme Court noted that moral damage redress must be fair and sufficient to compensate the victim. Likewise, the judgment provided that damage redress should be sufficient to be 'dissuasive', to prevent further damage. This ruling has been construed by some practitioners as an implicit recognition of Mexican courts' ability to award 'punitive' damages when necessary.

Under a binding judicial precedent, issued on April 2017 by the First Chamber of the Mexican Supreme Court, limiting liability by fixing a monetary cap implies unfair compensation of damage. Thus, judges should quantify damages fairly, on a case-by-case basis.

In short, these kinds of punitive damages (more adequately moral damages) will probably start being awarded in contractual liability cases by Mexican courts.