Liability of board members of a limited liability company in Poland
The members of the management board of a limited liability company may be liable for the obligations of the company under article 299 of the Code of Commercial Companies. This liability is subsidiary. This means that a board member can be held liable for it in a situation where enforcement against the company proves ineffective. For the liability of a member of the management board for the company’s debts, it is important whether the person was sitting on the company’s board at the time the liability existed. In this context, an interesting, from the legal point of view, dispute arose before the Voivodship Administrative Court in Gdańsk. A member of the management board of a limited liability company indicated in the proceedings that in 2017 he had resigned from his position in the body. In view of this, he defended that he could be held liable for the company’s 2018 liabilities. The authority, on the other hand, referred to the data appearing in the National Court Register.
Factual state
In the case, the company had not paid its 2018 tax liabilities in full. The head of the tax authority could not obtain the outstanding receivables from the company, and therefore found the former member of the management board liable for the tax obligations. The authority pointed out that he had performed his function as a member of the management board in the company at the time and was therefore liable for the outstanding receivables. The former member of the management board filed an appeal against this ruling. He indicated that he had not held any position on the company’s board of directors since 2017, as he had resigned from his position. Furthermore, he argued that he only appears in the National Court Register because the company’s chairman of the board of directors did not submit an appropriate request for his removal from the register. The authority, on the other hand, continued, during the proceedings, to maintain that, according to the data disclosed in the register, he had sat on the company’s body unchanged since 2016 and, contrary to what he claims, he also served on the company’s board of directors at the time of the 2018 tax payment deadline. Additionally, the tax authority pointed out that the former member of the management board, after his resignation, continued to perform active activities for the company, including, inter alia: concluding contracts on its behalf, signing powers of attorney. In view of this, the authority stated that these activities were not performed by him as an employee, but as a member of the management board, as the aforementioned activities belonged to the competence of the management body. The former member of the management board brought an action in this case.
Court decision
The dispute was dealt with by the WSA in Gdańsk. The court indicated that the performance of the function of a member of the management board is based on the will of the person who performs it. In view of the fact that the person sitting on the body may resign from it at any time. The court pointed out that the authorities must, in each and every such case, determine whether the resignation actually occurred. Accordingly, in this case, it was necessary to examine whether the activities performed by the applicant fell within the scope of the duties of a member of the board. The court in the case pointed out that the appointment and term of office of members of the management board is an internal sphere of the company’s business. On the other hand, the entry in the Natrional Court Register of a member of the board of directors and changes thereto are declaratory in nature. Therefore, the entry in specific circumstances can be overturned. The court ultimately overturned the authority’s decision in the case.