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The Spanish Companies Act establishes that liquidators must grant a public deed of winding up of the company which must incorporate the final liquidation balance sheet and a record of the partners, and which must be registered at the Commercial Registry.

It also establishes that, even if all registration entries relating to the company have been cancelled, if unforeseeable assets appear, the liquidator must allocate them to the former partners and if unforeseeable liabilities appear, the former partners will be jointly and severally liable for them up to the limit of the amount they have received as liquidation proceeds, without prejudice to the liability of the liquidators.

However, once all formal procedures have been carried out (corporate, notary and registry procedures) regarding the dissolution and liquidation of the company ¿when does the legal personality of the company cease to exist?

The Judgement of the Provincial Court of Valencia of 14th September 2022 (ECLI:ES:APV:2022:1109A) refers to the doctrine established by the Supreme Court in the judgement dated 25th July 2012 which states the following:

  • The cancellation of the registry entries indicates the moment when the corporate personality ceases to exist.
  • The definitive disappearance of the company will only take place if the cancellation of the registry entries corresponds to a real situation, that is, when it has been liquidated and there are no unsatisfied creditors, unpaid partners, or undistributed assets.
  • Otherwise, the partners and creditors will be able to request the annulment of the cancellation of the registration and the reopening of the liquidation process, and furthermore, to file a claim against  those who may have pursued an undue cancellation of registration.
  • However, it is not possible to claim from a company with no legal personality without first seeking to recover it.

It also refers to the doctrine established in the Supreme Court Judgement if 25th May 2017 on whether a dissolved and liquidated company, with the registry entries cancelled, continues to have the capacity to be a defending party, represented by the liquidator, in a claim for supervening liabilities. Said judgement explains that there are contradictory pronouncements, namely:

  • Judgement of 27th December 2011 and 20th March 2013, which recognise the capacity of the company to be a defending party on the understanding that its legal personality survives albeit only to attend to pending legal relations. The cancellation of the registry entries is simply a procedure of registry mechanics which does not imply that effectively the legal personality ceases to exist, which will not come about until the complete expiry of all the company’s legal relationships.
  • Judgement of 25th July 2012, which considers that the cancellation of the registry entries signals the moment of the expiry of the corporate personality, thus it is not possible to file a claim against a company that lacks legal personality without first seeking to regain such personality.

It also refers to the criteria maintained by the General Directorate of Registries and Notaries, which is aligned with the first of the aforementioned two opinions, in its Resolution of 14th December 2016. The resolution deems that following the cancellation, the legal personality of the extinct company persists “as a basis for imputation as long as the legal relationships held by the company are not completely extinguished” and also that the cancellation of the registry entries is just a mere formula of registry mechanics which does not imply the effective extinction of its legal personality.

Finally, in conclusion, in cases of a non-definitive liquidation, not only can a future claim be directed against the company, but also that the prior annulment of the cancellation of the registration and the formal reopening of the liquidation should not be required, because “the personality of the company continues to exist, and the company may be sued and may be represented by the liquidator“.

The General Directorate for Legal Security and Certification follows the same criterion in its Resolution of 27th June 2023, in which it furthermore adds that the former liquidators may formalise legal acts on behalf of the wound-up company, subsequent to its registry cancellation, implementing article 400 of the Spanish Companies Act.

 

 

Mireia Bosch

Vilá Abogados

 

For more information, please contact:

va@vila.es

 

19th January 2024