Judgment No. 9955 of 2024: The Former Director's Interest in Challenging the Bankruptcy of the Acquiring Company

The recent order No. 9955 of April 12, 2024, issued by the Court of Cassation, offers important insights into the right of former directors of companies merged by acquisition to appeal. The Court addressed the issue of personal interest in challenging the bankruptcy judgment of the acquiring company, establishing that such interest exists and must be considered.

Context of the Judgment and Applicable Law

The case concerns the former director of a company that had been merged by acquisition into another company. Following the declaration of bankruptcy of the acquiring company, the former director filed an appeal in their own capacity, not as an officer of the dissolved company. This is where Article 18 of the bankruptcy law, which governs the right to appeal bankruptcy judgments, comes into play.

It is crucial to emphasize that Article 18 of the bankruptcy law provides that the interest in appealing is not limited solely to active companies but can also extend to former directors. This aspect is critical because the effects of a bankruptcy judgment do not only impact the company but can have direct repercussions on the personal and financial lives of directors.

Reasons for the Interest in Appealing

In general. The former director of a company previously merged by acquisition into another company has an interest in filing, in their own capacity and not as an officer of the dissolved company, pursuant to Article 18 of the bankruptcy law, an appeal against the judgment declaring the bankruptcy of the acquiring company, as such appeal is aimed at eliminating the negative personal effects that may arise from such measure, both on a moral level, in relation to potential criminal charges, and on a financial level, in relation to potential liability actions.

This summary clearly highlights that the former director is not merely a representative of the dissolved company but an individual who can suffer direct harm due to the bankruptcy of the acquiring company. The implications can be both moral, related to potential criminal charges, and financial, concerning liability actions. In other words, the former director has the right to defend their position, preventing the bankruptcy from compromising their honor and finances.

Implications and Conclusions

Judgment No. 9955 of 2024 represents an important step in Italian bankruptcy jurisprudence, as it expands protection for former directors of merged companies. It underscores the importance of considering the individual beyond the mere legal entity represented by the company. The protection of the right to appeal is part of a broader context of safeguarding directors' rights, who cannot be considered mere executors of corporate decisions.

With a view to greater accountability, it is essential for former directors to be aware of the legal implications of mergers and potential bankruptcy proceedings, thereby protecting their personal rights and interests.