The II. Civil Senate of the Federal Court of Justice (BGH) has ruled on the liability of shareholders of a limited liability company (GmbH) if they re-establish a company that has been closed down but do not disclose the re-establishment to the registry court.
The plaintiff is the insolvency administrator in insolvency proceedings concerning the assets of a limited liability company (GmbH) founded in December 1993 with the business purpose of distributing medical remedies, aids and care products as well as trading in goods of all kinds. At the end of 2003, the GmbH had no assets and no turnover. On 21 July 2004, the shareholders' meeting decided to change the company's name and object, relocate the company's registered office and appoint a new managing director. The latter applied for the changes to be entered in the commercial register without disclosing the economic re-establishment and commenced business in accordance with the new object of the company. On 30 December 2005, the defendant acquired the only share in the GmbH with a nominal value of DM 50,000 at a price of € 7,500. On 8 February 2007, insolvency proceedings were opened against the GmbH's assets. The plaintiff established claims in the amount of € 36,926.53 for the insolvency table and claimed this amount from the defendant as purchaser of all shares in the GmbH.
The Regional Court dismissed the action, the Higher Regional Court granted it in its entirety. In response to the appeal allowed by the Higher Regional Court, the Federal Supreme Court overturned the appeal ruling and referred the case back to the Court of Appeal for further clarification.
The Federal Supreme Court confirmed the Higher Regional Court's finding that the commencement of business with a changed corporate purpose on 21 July 2004 constituted a new economic formation. According to the case law of the Federal Supreme Court, it is to be considered an economic re-establishment if the legal entity embodied in a GmbH exists as a legal entity without an enterprise and is then endowed with an enterprise. In this context, it makes no difference whether a company deliberately founded "for stock" for later use is activated or whether, as in the case decided, a shell company that has become empty is reused.
According to the established case law of the Federal Court of Justice, in the case of an economic re-establishment, the shareholders are liable for the replenishment of the company's assets up to the amount of the share capital stated in the articles of association (under-balance liability). In addition, the economic re-establishment must be disclosed to the registry court. In case law and literature it has been controversial how liability is structured if the required disclosure of the economic reorganisation is not made. The Federal Supreme Court (BGH) did not follow the opinion of the Higher Regional Court (OLG) that in this case the shareholders are subject to a liability to cover losses for an unlimited period of time. Instead, it ruled that in the present case, for a possible underbalance liability of the defendant, who may be liable as the acquirer of the share in the company, it depends on whether at the time of the economic re-establishment in July 2004 there was a coverage gap between the assets of the company and the share capital according to the articles of association. Since the Higher Regional Court had not made any findings on this from its legal point of view, the matter was referred back for further clarification.
Judgment of the BGH of 6 March 2012 - II ZR 56/10
Traunstein Regional Court - Judgment of 20 March 2009 - 1 HKO 1743/07
OLG Munich - Judgment of 11 March 2010 - 23 U 2814/09
Source: Press release of the BGH
Goldberg Attorneys at Law
Attorney at Law Michael Ullrich, LL.M. (Information Law)
Specialist lawyer for information technology law (IT law)