Liability of “new” partners for the obligations of a civil law partnership

Liability of “new” partners for the obligations of a civil law partnership

Rules of responsibility

The legislator provided for the basic rule of liability of partners in a civil law partnership in art. 864 of the Civil Code. In accordance with this provision, the partners are jointly and severally liable for their obligations. While the joint and several liability was defined by the legislator in art. 366 of the Civil Code. Joint and several liability means that the creditor may demand that his claim be satisfied (1) by all debtors together or (2) by several of them or (3) even by each of them individually. By translating the above definition to the provisions on the civil law partnership, the creditor may freely choose against whom he will file a lawsuit. Will he sue all partners of a civil law partnership at the same time, or only some of them, or maybe even only one of them.

A new partner

The principle seems to be clear and simple, however, it actually causes several important problems. The doctrine and jurisprudence present doubts as to whether the “new” partner in a civil law partnership in accordance with art. 864 of the Civil Code bears the joint and severe liability also for those obligations of a civil law partnership that arose prior to his accession? At the same time, the new partner is understood as one who joined the company during its duration.

It can be said that the doctrine in the above matter is consistent. There are no grounds to demand repayment of liabilities arising before the date of his accession. This view was primarily a consequence of the Supreme Court’s ruling of August 24, 1967 (file reference number: II CR 187/67). The court clearly indicated that the partners are not liable with personal property for the obligations of a civil law partnership if their source are events from the period in which they were not partners. As an exception, the Supreme Court allowed the possibility of “(…) extending the liability for the company’s obligations to a partner who joined the company after their creation. Such an extension required an agreement concluded with other partners.” (judgement of the Supreme Court of November 21, 1995, file reference number: III CZP 160/95).

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A new rule

However, a newer and more recent judgement of the Supreme Court is worth discussing of October 28, 2003 (file reference number: I CK 201/02). In this judgement, the Supreme Court also explicitly extended the liability to “new partners”. This court ruled that “such partner is jointly and severally liable with the other partners for obligations arising in the period before the partner joined the company, because the law does not differentiate their liability due to the moment of debt.” According to the Supreme Court, the moment of joining a civil law partnership is significant, but only in the scope of internal settlements between partners. However, “outside” towards the creditors, the moment of joining the company is irrelevant.

The above judgement initiated a gradual change in views, which seems to be continuing. Increasingly, rulings that support the above position are more common, which is much better for creditors. Of course, there are still supporters of the “old school” who reject the view of the Supreme Court of 2003, accusing it of, among others, contradiction with the prohibition of the presumption of solidarity and systemic interpretation. However, the analysis of newer judgements leads to the conclusions that the case-law goes towards extending creditor protection. Of course, this is at the expense of the partners who did not have the slightest impact on the obligations incurred before their accession.

Legal status as of October 2019

 

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