{"id":12028,"date":"2024-08-20T06:52:53","date_gmt":"2024-08-20T06:52:53","guid":{"rendered":"https:\/\/seegman.com\/the-provincial-court-of-madrid-recognizes-the-possibility-of-bringing-an-individual-action-for-liability-in-the-event-of-stripping-of-a-companys-assets\/"},"modified":"2025-02-11T22:56:40","modified_gmt":"2025-02-11T22:56:40","slug":"the-provincial-court-of-madrid-recognizes-the-possibility-of-bringing-an-individual-action-for-liability-in-the-event-of-stripping-of-a-companys-assets","status":"publish","type":"post","link":"https:\/\/seegman.com\/en\/the-provincial-court-of-madrid-recognizes-the-possibility-of-bringing-an-individual-action-for-liability-in-the-event-of-stripping-of-a-companys-assets\/","title":{"rendered":"The Provincial Court of Madrid recognizes the possibility of bringing an individual action for liability in the event of stripping of a company\u2019s assets"},"content":{"rendered":"\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t\t\t\t
<\/div>\n\t\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t

The Provincial Court of Madrid recognizes the possibility of bringing an individual action for liability in the event of stripping of a company\u2019s assets<\/h1>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
\n\t\t\t\t\t\t\t
<\/div>\n\t\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t
Although in principle the stripping of a company\u2019s assets can be pursued through a corporate liability action, in exceptional and qualified circumstances and individual action is appropriate.<\/em><\/h5>\n

The Provincial Court of Madrid, in judgment 132\/2024 of April 23, dealt with a case in which a sole director diverted clients from one company to another, which was created for the purpose of avoiding the payment of a debt recognized by a final judgment in a previous proceeding. This act, which left the debtor company without assets, prevented the creditor from recovering its claim, even through enforcement proceedings.<\/p>\n

Traditionally, the damages suffered by the creditors due to the reduction of the corporate assets are considered \u201cindirect\u201d. That is, creditors cannot claim directly against the directors, since the damage affects mainly the company as a whole, and only secondarily the creditors and shareholders. The usual remedy for these cases is the corporate liability action provided for in Article 240 of the Spanish Companies Act (LSC), the purpose of which is to restore the company’s assets. However, the Provincial Court, following the doctrine of the Supreme Court, has pointed out that, in certain qualified cases, the creditors may suffer a \u201cdirect\u201d damage that justifies the use of the individual liability action (art. 241 LSC).<\/p>\n

In the specific case, the Provincial Court considers that all the elements necessary to admit the individual action were present: an organic wrong was committed, direct damage was caused to the creditor and there was a clear causal link between the actions of the director and the damage suffered.<\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

\n\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t
\n\t\t\t\t\t\n\t\t\t\t\t\t\n\t\t\t\t\t\t\n\t\t\t\t<\/i>\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\tDOWNLOAD<\/span>\n\t\t\t\t\t<\/span>\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t
\n\t\t\t\t\t\n\t\t\t\t\t\t\n\t\t\t\t\t\t\n\t\t\t\t<\/i>\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\tSEE SENTENCE<\/span>\n\t\t\t\t\t<\/span>\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
\n\t\t\t\t\t\t\t
<\/div>\n\t\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t
\n\t\t\t\t\t\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t<\/i>\t\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t

More Technical Articles<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t
\n\t\t\t\t
\"Sliders<\/div><\/a>\n\t\t\t\t
\n\t\t\t\t

\n\t\t\t\n\t\t\t\tHow to structure deferred payments and cross-guarantees in small-market M&A transactions\t\t\t<\/a>\n\t\t<\/h3>\n\t\t\t\t
\n\t\t\t

In small-market M&A transactions, deferring part of the purchase price is not an exception but a common feature of the deal structure. It reflects not<\/p>\n\t\t<\/div>\n\t\t\n\t\t\n\t\t\tREAD MORE \u00bb\t\t<\/a>\n\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/article>\n\t\t\t\t

\n\t\t\t
\n\t\t\t\t
\"textura\"<\/div><\/a>\n\t\t\t\t
\n\t\t\t\t

\n\t\t\t\n\t\t\t\tStock options, RSUs and phantom shares for individuals relocating to Spain: key tax considerations\t\t\t<\/a>\n\t\t<\/h3>\n\t\t\t\t
\n\t\t\t

Equity compensation plans raise particularly complex tax questions when the beneficiary relocates to Spain. In these cases, it is not enough to look at the<\/p>\n\t\t<\/div>\n\t\t\n\t\t\n\t\t\tREAD MORE \u00bb\t\t<\/a>\n\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/article>\n\t\t\t\t

\n\t\t\t
\n\t\t\t\t
\"Sliders<\/div><\/a>\n\t\t\t\t
\n\t\t\t\t

\n\t\t\t\n\t\t\t\tPrivate limited company or public limited company in Portugal: practical guide for investors\t\t\t<\/a>\n\t\t<\/h3>\n\t\t\t\t
\n\t\t\t

Investors setting up a company in Portugal usually end up choosing between two corporate forms: the private limited company (sociedade por quotas, Lda.) and the<\/p>\n\t\t<\/div>\n\t\t\n\t\t\n\t\t\tREAD MORE \u00bb\t\t<\/a>\n\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/article>\n\t\t\t\t<\/div>\n\t\t\n\t\t\t\t

<\/div>\n\t\t\t\t