Statutory Liability
Categories: Accounting, Insurance
If you have statutory liability, it means you’re legally on the hook. Responsible. Rut-roh.
This is a generic legal term that can be used in many arenas, but you’ll hear it a lot when it comes to stockholder obligations, real estate transactions, and even board member behaviors. Statutory liability means someone’s being held responsible for an action due to a law...a law that’s not open to interpretation. Sorry/not sorry.
Remember when you were a kid and you conveniently forget to tell your mom about that D you got? Well, that doesn’t work legally. Don’t think you’re immune from statutory liability because you didn’t do something, or omitted some information. You can be just as liable.
Deep down under in the land of Aussies and Kiwis, it’s common for businesses to buy statutory liability insurance as a shield against a slew of potential onslaughts, based on how their laws are written.
