20 - Case 17: WAF – A gang of incompetents?

Summary

Case

In an interview about environmental protection, Howard, the president of a chemical company, accused the association ‘World Animal Fund’ (WAF) of being a ‘gang of incompetents who were taking advantage of people's credulity and using member contributions for mysterious purposes’. Can the WAF sue Howard for damages?

Discussions

Austria

Operative rules

The legal entity WAF has the legal standing to sue. Compensation would only be awarded for economic loss.

Descriptive formants

The crucial point in this case is the question whether a legal entity can be defamed in the sense of § 1330 ABGB, subs. 1. According to the OGH and to some legal writers, the ‘insultability’ (‘Beleidigungsfähigkeit’), and thus the right of action, stems from § 26 ABGB which sets out that legal persons have the same rights as natural ones. Comparable things should be dealt with comparably; consequently, a legal person unjustly labelled a ‘gang of incompetents’ suffers harm to its reputation since its social standing is tarnished by such an ‘attack’. Korn and Neumayer are the foremost critics of such a right, but fail to state a basis for their opinion.

If, on the other hand, the claim is based on § 1330, subs. 2 ABGB – under which ‘economic reputation’ (reflected in one's creditworthiness, earnings and advancement in profession) is protected against the dissemination of facts which do not correspond to the truth – the standing to sue is not questioned as the business reputation of legal entities must be protected in any event.