Wednesday, March 25, 2015
Revocation of a resolution to dissolve a legal entity
On 9 December 2014 the Supreme Court pronounced a ruling (ECLI:NL:HR:2014:3677; JOR 2015/33) which is also relevant to the law of the Caribbean (Is)lands of the Kingdom. On the basis of that ruling the following requirements are imposed on the revocation of a resolution to dissolve a legal entity:
1. the resolution to revoke must comply with the requirements which generally apply to a resolution of the general meeting of shareholders (read: the same requirements as the ones which apply to the resolution to dissolve);
2. the revocation shall not impair the legal certainty requirements or the rights and interests of third parties (read: nobody shall be harmed by the revocation);
3. the legal entity shall not yet have ceased to exist pursuant to Book 2 of the Dutch Civil Code (read: the winding up shall not yet have been completed); and
4. the court must approve the application of the legal entity (read: the resolution to revoke is passed on the condition of approval by the court and that approval must be requested from the court).
That the court must assess the resolution to revoke also means that the application must indicate what the reason was for the (conditional) revocation and what the interest is in this connection. The court will probably assess whether the resolution to dissolve and the resolution to revoke are passed for legitimate reasons and also whether the legal entity has a sufficiently substantial interest in revoking the resolution to dissolve.
The relevant documents must be lodged together with the application, including in any event (i) the resolution to dissolve; (ii) the resolution of a conditional revocation; (iii) insight into the financial position of the legal entity on the date of dissolution and the date of the resolution to revoke as well as into the developments in this connection in the period in-between; and (iv) a recent extract from the Chamber of Commerce.
With regard to point (iii) the ruling of the Supreme Court reads: "In addition, a statement from the accountant will have to be submitted providing an insight such that a sound opinion can be formed about this financial position. Financial information relevant to the decision should also otherwise be produced such as annual accounts or other (financial) details of the dissolved private company with limited liability." In some cases it might be difficult to meet this requirement (completely) and for now it is not clear how the court would handle this in such a case.
This arrangement is (also) so stringent to prevent abuse. Although the Supreme Court only speaks about a limited liability company in its ruling, the ruling will also be relevant to other legal entities with regard to which revoking the dissolution is being considered.