The Bologna Court on the independence of a shareholders' meeting chair
Elena Tarli
by Elena Tarli
An interesting decision by the Court of Bologna, in which the legal firm BussolettiNuzzo Avvocati prevailed, dealt with the suspension of a joint stock company's shareholders' resolution execution under Article 2378 of the Italian Civil Code.
The interim proceeding at issue was started by a shareholder within the merits judgement with the goal of determining the invalidity of the shareholders' resolution that appointed new directors. The shareholder, in particular and as relevant here, requested the suspension of the shareholders' resolution on the grounds that the chair of the meeting was not independent, and that directors had been appointed who had a conflict of interest with the company.
The court focused on the necessary requirements for granting interim relief, which were deemed insufficient in this instance. It is helpful to focus on specific elements of the court's reasoning, as they offer thought-provoking insights.
The court dismissed the argument that the challenged resolution was invalid due to the chair of the meeting's lack of independence in the context of the fumus boni iuris. The chair, when selected in accordance with the by-laws, may even represent a group of voters, which does not, in and of itself, result in the resolution being declared invalid.
Indeed, Article 2371 of the Italian Civil Code doesn't require that the chair of the meeting be independent. This is due to the fact that the chair's responsibilities are restricted to the following: verifying the regularity of the meeting's constitution, verifying the identity and legitimacy of the attendees, regulating the meeting, and certifying the voting results. The chair is also responsible for reporting the results of these checks in the minutes.
Moreover, the chair's review and related checks are conducted on a formal legal basis; otherwise, the shareholders' procedures would be subject to the unpredictability and uncertainty of assessments expressed by an office whose appointment doesn't require impartiality and competence in this regard, and before which there is certainly no reason or way to conduct any adversarial proceeding, which would be inconsistent with the principles governing the matter.
The court also noted that the resolution appointing a director who is potentially in conflict of interest with the company is not invalid per se, but it may potentially result in the measures stated in Article 2390 of the Italian Civil Code, which include subsequent removal from office.
The court also found that the periculum in mora was not present. In particular, the judge rejected the hazard as inherent (in re ipsa) and denied its actual existence as a result of the absence of allegations of specific instances of mismanagement due to the directors.
Elena Tarli, a lawyer with academic experience and an MA in business law, joined BussolettiNuzzo Avvocati in 2018. She advises in the corporate and litigation areas. Contact Elena.
GGI member firmBussolettiNuzzo AvvocatiRome, ItalyT: +39 06 47825044
Law Firm Services
BussolettiNuzzo Avvocati is an Italian law firm which advises on a wide variety of matters and disputes with a multi-year experience in commercial, competition, finance and civil law, and providing its clients with tailored solutions to solve complex problems.
