Insolvency

When a company enters insolvency proceedings (that is, when it cannot meet its debts and resorts to a judicial procedure to manage them), this can affect in different ways the potential claims or actions that can be brought against the company's directors.

First, it is necessary to distinguish between two types of legal actions:

- liability for debts: when the director is held personally liable for the company's debts for not fulfilling their obligations (for example, not dissolving the company when required).

- individual liability: when a partner or a third party holds the director personally liable for specific damages caused by their actions.

In the first case, if the company is already in insolvency and a claim is to be filed against the director for liability for debts, it cannot be admitted until the insolvency proceedings are concluded in one of two ways: either when a settlement is approved and becomes effective with the creditors, or when the insolvency is terminated because the company has been liquidated. If the claim was already in progress and if the contest is declared afterwards, the procedure will be suspended until that moment.

However, in individual claims by partners or third parties, the contest does not affect, they can file their claims at any time , even if the company is in contest.

The only exception is when both types of actions (for debts and for personal damages) are brought together in the same claim. In that case, the claim as a whole is suspended or dismissed until the contest ends, although one of the actions could be filed separately. If the interested party only wants to proceed with the individual liability action, they can withdraw (waive) the other one, to avoid being affected by the suspension.

If you are in a similar situation, our professionals can advise you on the defense of your rights