Termination of the franchise agreement and the responsibility of the administrators

contrato franquicia

Social administrators declared responsible for the debt by the termination of the franchise agreement when the cause of dissolution of the company is present

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When the obligation to call a general meeting to adopt the dissolution agreement is breached after the legal cause occurs, The administrators will respond jointly and severally to the social obligations that derive from that breach. (art. 367 LSC).  In the case that we analyze below, the debt originated from the development of a franchise agreement that was resolved.

Section 15 of the Provincial Court of Barcelona gave judgment on 6 May 2020, with No Resolution 723/2020, dismissing the appeal filed by SCC in its entirety, S.L. Confirmed the ruling of the sentence handed down by the Commercial Court nº 7 from Barcelona on 11 June 2019.

Fact background,,es,Juan Alberto and Paulina filed suit against FTA,,es,Asset Securitization Fund,,es,requesting the declaration of nullity for abusive of the floor and ceiling clauses contained in the novation contract of the mortgage loan of,,es,with the corresponding refund of amounts unduly collected,,es,The Securitization Fund Management Company,,es,Beech,,es,acting on behalf of FTA, he responded to said claim alleging that he lacked passive legitimacy since the entity had no legal personality and that it constituted only a private and open fund and that therefore the passive legitimization corresponded to BBVA as successor of Catalunya Banc that was the Company fund constituent,,es

FITMAN, S.L. and SANTA COLOMA COURIER, S.L. (SCC, S.L., onwards), started a business relationship through a franchise agreement (MRW) the 12 July 2013. The first was a franchisor, and the second, franquiciada.

FITMAN, S.L. filed suit against SCC, S.L., claiming the amount of unpaid bills. In addition to the quantity claim action, filed the action of liability of directors, under art. 367 LSC, against D. Stephen and D. Eulogio.

SCC, S.L., not only opposed the lawsuit, but instead filed a counterclaim, claiming amounts owed under the termination of the franchise agreement without there being any cause for it.

Primera Instancia

The Commercial Court nº 7 Barcelona gave judgment on 11 June 2019, estimating the lawsuit filed by FITMAN, S.L., and dismissing SCC's counterclaim, S.L.

Considered proven the amount owed to FITMAN, S.L. and also the responsibility of the two administrators of the company, after being proven that SCC, S.L. was incurs due to dissolution since 2014.

Provincial Court

SCC, S.L. filed an appeal. The reasons focused on questions about the commercial relationship between the two companies, the causes for termination of the contract and the settlement of pending services. With the aim of revoking the sentence handed down in the first instance and to consider the counterclaim. No reason was alleged regarding the estimation of the liability action against D. Stephen and D. Eulogio.

All three motives were dismissed by the Section.

The first one was related to the proof of the debt claimed by FITMAN, S.L. The Section brought up the art. 456 LECivil, which allowed a new examination of the actions carried out in the first instance, also in the tests that would have been practiced. The burden of proof according to art. 217 LECivil not only corresponded to FITMAN, S.L., but also SCC, S.L., I could have provided additional evidence. However, only provided a formal reference to the accounts of the company, without providing books or documentary support to support said accounts. Thus, for Section, the invoices proved the reality of the debt, considering the invoice as the normal operation of the settlements made until the franchise agreement was resolved.

Regarding the second alleged reason for appeal, referred to inconsistency of the sentence after having omitted the pronouncement of some of the defendant's allegations, after failing to terminate the franchise agreement by FITMAN, S.L. at the time he discovered that SCC, S.L., was breaking the exclusivity clause. However, the Section considered that no allegation was made in this regard in the answer to the application, nor was it considered by SCC in the previous hearing, S.L., as a controversial issue. Thus, this motive was also dismissed.

The last reason for appeal was the lack of proof to consider that FITMAN, S.L., had just cause to terminate the franchise agreement. The Section dismissed it because it considered that the cause of resolution was more than justified and that it was correctly communicated to SCC., S.L., following the issuance of a report by a detective in November 2015, where it was reflected that the defendant had breached the exclusivity pact, after collaborating with the competing company of MRW, ASM.

Conclusion

According to the first section of the article 367 LSC, “They will respond in solidarity of the social obligations after the occurrence of the legal cause of dissolution the administrators que incumplan la obligación de convocar en el plazo de dos meses la junta general para que adopte, if, the dissolution may, and administrators who do not apply for judicial dissolution or, you procediere, Contest society, within two months from the scheduled date for holding the meeting, when it has not been established, or from the day of the meeting, cuando el acuerdo hubiera sido contrario a la disolución.”

In this manner, existe la posibilidad de aumentar el radio de acción de los acreedores de una sociedad, extendiéndose al patrimonio personal de los administradores declarados responsables.

 

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