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Assertion of claims for damages against the managing director of a limited liability company

The shareholders' meeting decides on the assertion of claims for damages against managing directors. If the resolution is missing, the limited liability company ("GmbH") is not entitled to take legal action in court proceedings. This is shown by a ruling of the Naumburg Higher Regional Court ("OLG").

The facts of the case

The ruling of the OLG Naumburg is based on the following facts: The plaintiff is a housing association in the legal form of a GmbH (limited liability company) with two managing directors. The company sought damages from one of the managing directors because he had arranged for remuneration payments without consulting the other managing director, for which, in the company's opinion, there was no legal basis. In the first instance, the action was dismissed by the Stendal Regional Court. The plaintiff appealed against the judgement.

Judgement of the Naumburg Higher Regional Court of April 29, 2021 (Case No. 2 U 91/20)

The appeal was unsuccessful. The plaintiff did make up for the missing shareholders’ resolution in the first instance, which is a necessary prerequisite for the assertion of the claims for damages. However, it was unable to prove the occurrence of a pecuniary loss due to the conduct of the managing director.

Practical advice

The managing director of a GmbH is subject to a wide range of duties, some of which are specifically regulated by law (e.g. the duty to maintain capital, to submit a list of shareholders following changes in the shareholder structure or to ensure proper accounting) or which arise in general from Sec. 43 (1) of the German Limited Liability Companies Act ("GmbHG"), which obliges the management to exercise the care of a reasonable businessman in all matters relating to the company. If the managing director breaches this obligation in the performance of a duty, he shall be personally liable for the resulting damage pursuant to Sec. 43 (2) GmbHG.

In the case of a GmbH, a resolution of the shareholders' meeting must precede the assertion of such claims for compensation against current managing directors or managing directors who have already left the company (Section 46 No. 8 alt. 1 GmbHG). In this shareholders' resolution, the specific misconduct of the managing director must first be named before it is determined whether action is to be taken against the managing director at all and - if so - how, i.e. what measures are to be initiated against him. The passing of a resolution may be dispensable in exceptional cases; in particular in a GmbH with only one shareholder it is not necessary if the will of the sole shareholder to assert the claims for compensation is demonstrated in another way. Even in a two-person GmbH, the resolution requirement may not apply if one of the shareholders (who is also managing director) is himself affected and is therefore subject to a voting prohibition. Apart from this, it is also possible to waive the resolution requirement in the articles of association.

The competence to decide on the assertion of claims for compensation remains with the shareholders' meeting as long as nothing else is regulated. As the OLG Naumburg has emphasized, this also applies if a supervisory board has been formed; the decision-making competence does not automatically pass to the supervisory board. However, the shareholders are free to transfer the decision-making authority to another board (e.g. a supervisory board, an advisory board or a shareholders' committee) by means of corresponding provisions in the articles of association.

Unless the shareholders' resolution is dispensable in exceptional cases, actions by the company against the managing director are unsuccessful as long as the resolution is missing. The company may therefore lose the case for this reason alone. At best, the resolution should therefore be present before the action is filed or - as in the case of the OLG Naumburg - it should be made up for in the ongoing proceedings or in the appeal instance.

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