In the following, the ruling of the Federal Court of Justice of August 19, 2020 will be explained. In this new decision, the Federal Supreme Court dealt on the one hand with the effects of the deletion of a stock corporation from the Commercial Register after bankruptcy proceedings have been opened against it. With regard to the effects, the Federal Court had to deal in particular with the consequences of the deletion for the creditors of the bankruptcy estate. On the other hand, the decision deals with a more well-knownissue, namely the liability of the bodies of a joint-stock company under the company law.
The facts of the case will be explained at the outset, after which, we will, in accordance with the order of the Federal Supreme Court, first discuss the effects of the deletion from the Commercial Register on the assignment creditors and then the responsibility under stock corporation law. Finally, the most important passages of the decision of the Federal Supreme Court will be explained again.
Facts and explanatory notes on the bankruptcy proceedings
On April 23, 2013, bankruptcy proceedings were opened against D AG. In case of opening a bankruptcy, the Bankruptcy Office calls upon all creditors of the bankrupt to submit their claims against the bankrupt to the Bankruptcy Office. Subsequently, the Bankruptcy Office prepares a so-called collocation plan, which includes all the submitted bankruptcy claims and divides them into three classes. First class claims are satisfied first and third class claims last.
In the case before the Federal Court, B AG and C AG were collocated with their receivables in the collocation plan concerning the bankrupt D AG into the third receivables class.
When bankruptcy is opened, the bankruptcy office takes over the bankruptcy administration. The bankruptcy estate comprises the assets of the bankrupt at the time of the opening of the bankruptcy. The bankruptcy estate has no legal personality of its own, but has all the legal rights that the bankruptcy site had before the bankruptcy was opened. The bankruptcy estate is represented by the bankruptcy administration. The bankruptcy office thus takes the place of the bankrupts. This means that debts to the bankrupt can only be paid to the bankruptcy office or the bankruptcy estate and not to the bankrupt themselves. On the other hand, the bankruptcy site can no longer validly dispose of its assets.
Process history
In the said decision, the Bankruptcy Office, as the bankruptcy administration, assigned to creditors B and C the legal claims of the bankruptcy estate in accordance with Art. 260 SchKG (i.e. in discharge of their claims in the same amount). After the supposed end of the liquidation, the bankruptcy proceedings were closed with the judgement of the bankruptcy judge and the D AG was deleted from the commercial register.
Subsequently, assignment creditors B and C filed an action with the district court for payment of CHF 808,385.35 from liability under company law against A, who had acted as a director of D AG. The plaintiffs accused the Board of Directors D of careless actions to the detriment of the bankrupts and their creditors. The granting of an unsecured loan to a (here not further relevant) company for the realization of single-family houses in Uzbekistan and the takeover of this loan from the bankrupts by their board of directors A was problematic.
The district court dismissed the lawsuit for lack of active legitimation on the grounds that the bankruptcy site no longer existed and therefore could not assert any claims. With the deletion of the AG in the commercial register, the legal entity of the responsibility claim had ceased to exist.
In the meantime, based on a ruling by another district court, the bankruptcy site D AG has been re-registered in the commercial register.
Assignment creditors B and C filed an appeal against the decision of the district court with the higher court. The higher court rejected the case for reassessment at the district court because the re-registration in the commercial register was a real novelty, due to which the active legitimation of the two appellants was given.
Following the rejection by the Higher Court, the District Court ordered the Board of Directors A to pay the claimed amount of liability under company law. Against this decision, Board of Directors A filed an appeal in civil cases with the Federal Court.
The Federal Court's considerations regarding the deletion of the company from the Commercial Register and its effects on the assignment creditors
The complainant, Board of Directors A, argued that the deletion from the commercial register meant that creditors B and C had no active legitimacy to file a lawsuit against the bankruptcy site D AG. It was also arbitrary of the lower instance to state that the re-registration could not have been brought before the first instance, even with reasonable care. The parties had been represented by lawyers, which is why it was reasonable to bring the re-registration before the first instance. The Federal Supreme Court, however, dismissed the argumentation as irrelevant, since the active legitimation would not in any case be lost with the deletion of the company from the commercial register.
In his first argument, the complainant, Board of Directors A, referred to the judgment 4A_384/2016 of the Federal Supreme Court. The Federal Supreme Court replied that the said decision did not deal with assignment creditors because no assignment took place. Even after the quoted judgment, creditors were still actively legitimized if the bankruptcy was closed for lack of assets, since the bankruptcy judge could reopen the bankruptcy if assets belonging to the company were subsequently discovered.
If a company is deleted from the Commercial Register, the creditor can demand re-registration if new assets are revealed. He can then effect the collocation of his claim and have the procedural rights assigned to him by the bankruptcy office. This is because only a validly collocated company creditor is admitted to a liability action under the company law. In the aforementioned decision, the re-registration of the company in the Commercial Register was necessary for the bankruptcy proceedings to be carried out and for an assignment to take place in accordance with Art. 260 of the SchKG.
It is controversial in the doctrine whether the registration of stock corporations is constitutive and whether the deletion leads to their demise. After the judgement 4A_384/2016 was issued, the opinion was expressed in the doctrine that active claims ceased to exist with the cancellation of the stock corporation. However, in the judgment under discussion here, the Federal Supreme Court made it clear that this view is in contradiction to case law. The change in the practice of the Federal Supreme Court requires a better understanding of the ratio legis, changed external circumstances or a changed view of the law. The change in practice must therefore always be based on objective reasons. However, the Federal Supreme Court did not deal with this in BGE 4A_384/2016, which is why it cannot be assumed that the Federal Supreme Court intended a change in practice. Furthermore, the loss of the active legitimation of the assignment creditors under Art. 260 SchKG in the event of deletion of the company would be incompatible with the systematics and purpose of the SchKG.
The establishment of a company requires registration in the commercial register. Therefore, it can be assumed that the company will be dissolved when it is deleted. A debt collection against the company is therefore no longer possible, as the legal entity no longer exists. This does not mean, however, that the claims against the company will be lost. With the cancellation of the company, the power of representation of the previous administration and liquidators is lost, which is why there is no person or debtor who can make legally binding declarations in the debt collection proceedings and to whom the debt collection documents can be served.
The Federal Court stated that the liquidation was not completed as long as there were still claims or obligations in the name of the company. If a cancellation is wrongly made because claims or obligations still exist, re-registration may be requested. Claims are not lost when the company is deleted from the commercial register.
A joint-stock company does not lose its legal personality when bankruptcy is opened. Its legal existence only ceases when it is deleted from the Commercial Register or liquidation is terminated. The company's capacity to act is lost in favour of the bankruptcy estate.
A joint-stock company does not lose its legal personality when bankruptcy is opened. Its legal existence only ceases when it is deleted from the Commercial Register or liquidation is terminated. The company's capacity to act is lost in favour of the bankruptcy estate.
The situation is different if an assignment under Art. 260 SchKG has been made, as in the case under discussion here. The deletion of the company has no influence on the active legitimation of the assignment creditors, which is why no re-registration is necessary so that the creditors suing in their own name can assert the claims of the deleted company. The claims were never pending or abandoned, but were completely transferred to the assignment creditor.
The assignment according to Art. 260 SchKG is an assignment or institute under operating and procedural law and not an assignment under civil law - this in advance. With the assignment, the authority to conduct the proceedings is transferred. The assignment creditors do not become bearers of the assigned claim, although they act in their own name, on their own account and at their own risk in the proceedings. The creditor is assigned the right of action of the bankruptcy estate. This is a special regulation under execution law. It serves the interest of the company creditors to make the assets belonging to the bankruptcy estate available. Against this background, the argumentation of Board of Directors A becomes more understandable, who basically argued that a claim could not be enforced if the claimant no longer existed at all, but that only a lonely and virtually emptied litigation authority was left as a "remnant".
However, the Federal Court did not follow this logic. It would not be compatible with the purpose of the bankruptcy proceedings to let the right to conduct the proceedings lapse when the company is deleted from the commercial register. According to the Ordinance on the Management of Bankruptcy Offices, the Bankruptcy Office must request the termination of bankruptcy proceedings if, after the assignment of claims and the assumption that their enforcement would not lead to any surplus, beyond the claims of the assignment creditor, which would flow back to the bankrupt company. A legal entity is deleted ex officio when the court makes the decision to terminate the bankruptcy proceedings. It would be possible to re-register if there were a surplus. However, in most cases this is unlikely and it is more reasonable to delete the bankruptcy company than to maintain the entry. If an entry would be necessary in order to assert claims, a prior conclusion of the bankruptcy proceedings would not make sense, as it would result in the deletion of the company and thus the loss of the active legitimation of the creditors suing under Art. 260 of the Swiss Federal Law on Insolvency Proceedings.
The Federal Supreme Court emphasized: “The deletion of a company does not prevent a subsequent bankruptcy”. The Federal Supreme Court continued “Assets that are discovered later are realized and distributed by the bankruptcy office. This does not require a re-registration of the company. Only if the bankrupt's estate in the post-bankruptcy period has been reduced by means of settlement, debt collection, lawsuit, etc. Only if the bankruptcy estate wants to assert claims through settlement, debt enforcement, lawsuit, etc., a re-registration is necessary.”
The legislator assumes that in the context of post-bankruptcy, which does not require re-registration, claims could arise and be assigned under Art. 260 SchKG. However, if re-registration is not necessary at this point according to the legal regulation, even an assignment already made before the company was deleted cannot be influenced by the deletion.
Even if a claim were to be lost with the deletion of the company, it would be revived with re-registration. Since the resurgence of the claim would be subject to events that have occurred since then, such as the other loss of the claim, payment to the plaintiff creditors would release the debtor regardless of whether the company is registered in the commercial register. The plaintiff creditors and the bankruptcy estate would not be able to sue again, as the former would otherwise be in conflict with their previous behaviour and the latter not, as the assignment would regain validity. According to the Federal Supreme Court, it was therefore a mere harassment to demand re-registration - this does not deserve legal protection.
The cancellation of the company has no effect on the possibility of enforcing a claim assigned under Art. 260 SchKG.