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Civil Claims and Corruption

If you can show that corruption has taken place, it may also be possible for you to bring a civil claim. A civil claim involves arguing a person or corporation violated your private rights.

1

Is a Civil Claim Right for Me?

A question to ask yourself when considering bringing a case to court is whether bringing the case is the right decision for you. You should continue to ask yourself at each stage of your case’s preparation.

The following table of advantages and disadvantages is designed to help you consider whether a civil claim challenging corruption is right for you:

ADVANTAGESDISADVANTAGES
If you have been financially harmed by a corrupt act, a civil claim could ensure you get compensation for any harm suffered.Civil claims can generally only be brought by people who have been personally affected by a corrupt act (i.e. a person who has lost property through a corrupt deal). Civil claims can generally not be brought by people trying to challenge corruption in the public interest.
Civil claims generally have a lower standard of proof than criminal cases. This can mean that less evidence has to be gathered to bring a successful case, although the evidence still has to be compelling.The person complaining about the corrupt act is responsible for bringing a civil claim (e.g. gathering evidence, conducting the legal analysis and taking the procedural steps to bring the claim) instead of, for example, law enforcement bodies.
Civil claims can be brought against corporations and hold them directly accountable, as well as against individual wrongdoers or public bodies involved in corruption. Because you are personally bringing the claim, it can put you at greater risk of being targeted for challenging corruption.
Depending on the nature of the claim and the legal fee regulations, it can be very expensive to bring civil claims without financial support.
2

What Are the Relevant Laws and Where Can I Find Them?

Once you have outlined the facts of your case, look at the areas of law below and see which most closely relates to your situation. Then check your national law to see what the law is in your country.

Remember:

Your legal analysis has to be supported by the evidence you have gathered. You may wish to seek legal advice. A lawyer should be able to provide advice on the options available to you and advise on your chances of success.


(a) Bribery


In some countries, bribery is a civil wrong as well as a crime. The person receiving the bribe and the person giving the bribe can often be liable.

Where you are alleging that a company paid a bribe to a public official, you generally have to show that:

1. The public official received, was offered or promised a “benefit” (i.e. money, property or a service). This could either be given directly to the official, to a family member or a company they own.

2. The company or individual provided, promised or offered the public official with the benefit (i.e. they paid them or gave them property).

3. It was an “undue benefit” given, promised or offered so that the public official would act or refrain from acting in breach of their duties. 

Example: The Clean Company Act (Brazil)

The Act establishes that Brazilian companies and companies operating in Brazil can be held civilly liable for bribery, concealing assets, interfering with public procurement processes or investigations.

It does not generally have to be shown that the company deliberately bribed the public official or the public official knew they were receiving a bribe.

  • For example, they may have thought the payment was legitimate when it was actually a bribe. This is not a defence.

(b) Unjust Enrichment


Unjust enrichment happens where one person enriches themselves at the expense of another person in a way that is unjust or unfair. Unjust enrichment claims aim to undo the unjust enrichment by returning any of the gains the wrongdoer made to you.

To hold an individual or corporation liable for unjust enrichment, you generally have to show that:

1. The defendant has been enriched

Examples where the defendant (the person or company you are bringing the claim against) has been enriched include:

  • The defendant was paid money;
  • The defendant saved money;
  • The defendant was awarded a contract;
  • The defendant received property; or
  • The defendant received a service.

The value of how much the defendant was enriched should be detailed if possible (i.e. how much money were they paid from a deal?).

2. The enrichment was at your expense

This means you must have suffered some loss that is related to what the defendant gained. For example:

  • The defendant managed to acquire property that belonged to you through corruption;
  • You paid the defendant money and this was wasted through corruption;
  • The defendant was awarded a government contract which you would have been awarded but for corrupt activities of the defendant.

3. The enrichment was “unjust”

One way the enrichment of a defendant could be unjust is if it was secured through corrupt activities. The following could be examples where enrichment is unjust:

  • The defendant secured a government contract by bribing a public official.
  • The defendant acquired your property through bribery of law enforcement.

(c) Breach of Contract


If you have a contract/agreement with another individual or company, and you believe they have committed a corrupt act, this could amount to a breach of contract.

If you can prove a breach of contract, this could allow you to:

  • Bring the contract to an end and stop your dealings with the individual or company; and
  • Bring a claim for breach of contract to recover any loss that was caused by the corrupt activity.

Example: Decree No.1023/2001 (Argentina)

Article 10 of the Decree establishes that public contracts tainted with corruption will be terminated.


(d) Breach of Fiduciary Duty


In certain relationships, people owe each other legal obligations called “fiduciary duties”. For example:

  • Company directors have a fiduciary duties towards shareholders;
  • Partners in a business owe each other fiduciary duties.

These duties require people to:

  • Act in good faith;
  • Not create or have conflicts of interests (this is a position where someone’s personal financial interests conflict with their professional role); and
  • Be transparent about their earnings and not make personal profit from their position.

If a company director or business partner in a company you are involved in is involved in corrupt activity, such as bribery, this will likely be a breach of their fiduciary duties.

Where can I find these duties?

  • These duties are sometimes found in legislation regarding “company law” that outline what company directors can and cannot do. 
  • In some countries, there are also general duties that courts have created over time.

(e) Intimidation or Duress


A civil claim for intimidation could be brought where someone has threatened to do something unlawful which had the effect of coercing you into doing something which caused you loss. A claim of duress may entitle you to cancel or rescind a contract which you were pressurised into making by illegitimate or improper threats or actions by the other party.

  • An example could be where a company threatens to make false reports about you to the authorities unless you agree to transfer an asset or a benefit to you or to enter into a contract with them  

Check if your country has a similar law that could be used in your case. The Legal 500 Q & A Chapters on Bribery and Corruption or the UNODC Track Portal could be helpful for this purpose.

3

Who Can Bring a Civil Claim?


(a) The Individual Affected


Civil claims are based on your private rights rather than broader public interests. To bring a civil claim based, you will therefore generally need to be affected by the harm that your claim is based on. For example:

  • You may have lost out on being awarded a government contract because another company paid a bribe to the public official making the decision on who to award the contract to;
  • Your property may have been taken or used because of a licence obtained by corruption; or
  • Money of a company in which you are a shareholder was used by a company director to bribe a public official.

The person bringing the case (and his or her lawyers) are responsible for:

  • Gathering evidence to support your claim.
  • Conducting the legal analysis (i.e. make the argument that the conduct of the defendant has violated the relevant law). Their legal analysis has to be supported by the evidence they have gathered. 
  • Going through the various procedural steps required to bring a legal action in their  country.

(b) The Company or Corporation


If an employee, director or individual within a company is suspected of being involved in corruption, the company itself may be able to take a civil claim against them. For example, a company could take a civil claim against a director for bribery if this deprived the company of money.

In some cases, such as cases involving breaches of fiduciary duties, the company may be the only body that is able to take a civil claim. This is because fiduciary duties are owed to the company itself, and not other individuals.


(c) Anti-Corruption Agencies


In some countries, anti-corruption agencies or public prosecutors can take civil cases on your behalf if you submit a well-founded request or complaint.

Examples: 

The Special Investigations Unit (South Africa)

In South Africa, the “Special Investigations Unit” is empowered to bring civil, administrative and criminal cases against public officials and government bodies suspected of corruption. People can report corrupt activities to the SIU for them to investigate. These reports can then lead to the SIU taking a civil action against the wrongdoer. It can take actions in its own name or on behalf of persons that have filed the complaint to the SIU. In addition, the SIU has a Special Tribunal where it takes civil proceedings against persons and organisations accused of looting money through corruption.

The Public Prosecutor in Brazil

In Brazil, the public prosecutor takes legal action to establish civil and administrative liability of persons suspected of being involved in corruption. The prosecution can take action on behalf of individuals, groups or in the general public interest.

However, in most countries, this possibility is only available for criminal prosecutions.

4

Who Can a Civil Claim Be Brought Against?

Civil claims can be brought against individuals, organisations, public authorities or companies which you believe have committed a civil wrong.

This could include:

  • An individual that paid a bribe;
  • The company that the individual who paid the bribe works for, if the bribe was paid on its behalf; 
  • The public official that received the bribe;
  • The public authority that the public official who received the bribe works for, if the bribe was received on its behalf;
  • An individual who provided assistance for the corrupt activity to take place.
5

What Evidence do I Need to Bring a Civil Claim?

In civil law actions, it’s the claimant who has the “burden of proof”.

  • This means the person bringing a civil claim needs to prove their case.
  • In many countries, you have to prove your case to a standard of proof known as the balance of probabilities (i.e. there is more than a 50% chance what you are saying happened). There are higher standards of proof in other countries, but less evidence is generally required than in criminal cases.

The exact evidence that you need depends on the civil wrong you are arguing that has been committed.  However, in civil cases related to corruption, the following will often be important:

  • If payments were made, you will need to provide as much information as you can about the amount of the payments, when they were made, and how they were made. 
  • If other property was given or taken as a result of the corrupt acts, evidence of this transaction, including (if possible) the current location of the property.
  • If you were the owner of the property at the time it was taken, it would be useful to provide proof of your ownership or interest in the property. This is particularly important in civil cases as they concern a breach of your private rights.
  • If you had a contract with the wrongdoer, provide a copy of any written agreements or correspondence to prove this. 
  • Evidence of a form or business relationship between you and the wrongdoer. This could be important if your claim is based on the breach of a fiduciary duty.
  • Remember that cases of corruption are often not proved by a single piece of evidence, but by a number of pieces of witness evidence and documentary evidence, which together will establish a picture of corrupt acts and intent by the individual or company in question.

Practical Tip: Using a Criminal Conviction as Evidence

If the defendant has been convicted of a crime that relates to the corrupt activity you are complaining about, this criminal conviction can often be used as evidence in civil claims.

  • In some countries, such as Germany, a criminal conviction is automatic proof in civil cases of the facts that the conviction was based on. For example, if you are bringing a civil claim of bribery, a criminal conviction that the defendant committed the same incident of bribery will automatically prove that bribery was committed.
  • In other countries, such as the UK, the facts that a criminal conviction is based on is presumed to be true for the purpose of a civil claim unless the defendant proves this not to be the case. Therefore, a criminal conviction of bribery will be very strong evidence in a civil case that the defendant committed bribery, but this is not automatic.
  • In other countries, you will have to prove again that the defendant committed the corruption, even if there is a previous criminal conviction that relates to the same facts. 

For this reason, it may be wise to wait until a criminal investigation has taken place into the corrupt act you are complaining about before bringing a civil claim.

For more information on evidence gathering, see How Can I Prove My Case?

6

What Procedural Steps do I Need to Take?

When you have collected your evidence and conducted your legal analysis, you should then be able to start the court claim. The procedure that you have to follow will depend on your country, the type of claim, the court you choose, and on the procedural rules of that court.

Here are some general points of procedure that you may have to follow to pursue a civil claim:

Civil Claim Procedure

  • 1

    Notification

    Consider whether to notify the defendant corporation that you are going to bring a claim. In some cases, it may be unwise to do this if there's a risk the defendant will destroy important evidence and/or remove assets from the country in question.

  • 2

    File your claim

    File your case in court within the relevant time period after the harm occurred. This could involve giving the court a "claim form".

  • 3

    Present your statement of claim

    Present your grounds for the claim to the court, which will be shared with the defendants. This document is referred to as a "statement of claim", "statement of case", "particulars of claim" and "complaint". These documents and your claim form will then have to be shared with or "served" upon the defendant.

  • 4

    The defence

    The defendant will provide a "defence" which outlines their arguments They may say your version of events is wrong, argue their actions were not unlawful, or argue you cannot bring your case due to procedural reasons.

  • 5

    Interim Applications

    Consider whether to apply to the court to freeze the defendant's assets, force the defendant to disclose key documents/evidence in their possession, or apply for permission to use expert witnesses. Sometimes these need to be made immediately when you file your case.

  • 6

    Interim Hearings

    There may be "interim hearings" on relating to interim applications, specific legal or evidential issues before trial. For example, the defendant may apply for your case to be dismissed before trial. This could lead to a "mini trial" to see if your case has some chance of success.

  • 7

    Disclosure

    The defendant and you may be asked to exchange evidence you rely on If you are using witnesses, you will usually need to include what they are going to say in a "witness statement"

  • 8

    Trial

    Once evidence has been exchanged, the court will generally notify the parties of a date for the main court hearing (sometimes called the "trial"). At trial, you will present your arguments, the judge will ask questions, witnesses will give oral evidence and can be questioned by the lawyers. The court then makes its decision.

  • 9

    Judgment

    Once the main trial is over, the judge will consider each of the parties' arguments and form a decision, often in the form of a "judgment".

  • 10

    Appeal

    The losing party generally will have the right to appeal this judgement before a higher court.

7

What Happens if I Win?

If you bring a successful civil claim against a corporation, the judgment will be an official acknowledgement by a court that the corruption took place and harm was suffered. In addition, you could get one or more of the following “remedies”:


(a) Compensation


This involves the wrongdoer being ordered to pay “damages” (money) to compensate for the loss you suffered as a result of the corrupt act.

  • For example, if you were not given a government contract because a public official was bribed to award the contract to another company, compensation could cover the profits you would have made under the contract.

(b) Restitution or Asset Recovery


This is where the court orders the wrongdoer to return any money or property that they gained from the corrupt activity.

  • For example, if a company acquired land through bribing a public official, they would have to give the land back to the original owner.

(c) Court Order


As a remedy, the court could also order the wrongdoer to do a certain action or stop doing an action.

  • For example, a court could order a company to stop working on an infrastructural project that was being built on land obtained by corrupt means.
  • Or a court could cancel or void a contract from which the defendant was benefiting
8

Can I Bring a Civil Claim in Another Country?

If the corrupt activity that has caused you loss involves a foreign company or organisation, or there is some other international involvement in the events which took place, you may wish to consider whether.

If you want to find out more about the possibility of bringing a claim against a business in a foreign court, see How Can I Bring a Civil Claim Against a Business in a Foreign Court?

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