The fault lies with the torturer, Horst. If not Horvath, than Horst would have tortured someone else. If Horst wasn't "punishing" Lucius for not sending Horvath back to the front, he would have found another of Lucius's errors to punish. That said, this is a pivotal scene in the novel for Lucius, for Margarete, and for their relationship. Margarete had warned Lucius to "patch and mend" Horvath. She couldn't have anticipated the torture, but when it happens, it becomes her "I told you so" moment. Lucius, too, blames himself for Horvath's torture and is haunted by visions and nightmares. It is only when he returns to treating patients, perhaps to atone for his role in Horvath's fate, that the nightmares subside.