Simple Bankruptcy and Reckless Delay: The Cassation Court Ruling No. 29457/2025

The Court of Cassation, with Ruling No. 29457 of August 12, 2025, has provided important clarifications on the definition of simple bankruptcy, particularly in relation to "reckless operations" aimed at delaying insolvency. This judgment is of considerable interest to directors and entrepreneurs, outlining the boundaries between managing a business in crisis and criminally relevant conduct. Let's analyze the principles expressed by the Supreme Court, presided over by P. R. and reported by M. M. E.

The Notion of Simple Bankruptcy and "Reckless Conduct"

The crime of simple bankruptcy, governed by Article 217, paragraph 1, point 3, of the Bankruptcy Law, penalizes the entrepreneur who undertakes operations of gross imprudence to delay bankruptcy. It is distinguished from fraudulent bankruptcy by the subjective element, as it can also be constituted by gross negligence. The Cassation Court has focused on the notion of "gross imprudence," distinguishing between risky but legitimate choices and those that exceed the limit of legality, in line with previous rulings such as No. 24231 of 2003 and No. 118 of 2022.

The Core of the Decision: The Commented Maxim

The Supreme Court, rejecting the appeal against the conviction issued by the Court of Appeal of Bari, reiterated a fundamental principle, summarized in the following maxim:

In matters of simple bankruptcy, operations of gross imprudence are those that, undertaken solely to delay bankruptcy, are characterized by a high degree of risk, as they lack serious and reasonable prospects of economic success. (Case in which the Court deemed the conviction of the chairman of the board of directors of a cooperative society to be free from censure, who, aware of the severe debt exposure and the failure of previous recovery attempts, and moreover failing to take initiatives to avoid bankruptcy, had chosen, in the interest of the company, to preserve and guarantee the company's employment status).

This excerpt is the crux of the decision. The Court clarifies that the distinguishing element is not merely the high degree of risk, but above all the intrinsic lack of "serious and reasonable prospects of economic success." The intention to save the company or protect employment, as in the case of Chairman C. G., does not justify objectively unrealistic actions. The ruling highlights how awareness of severe debt exposure and the failure of previous attempts require directors to exercise extreme caution. Choices that worsen the insolvency and harm creditors constitute the crime, even if motivated by ethically positive reasons.

Conclusions and Practical Advice

The ruling of the Cassation Court No. 29457/2025 reinforces the need for directors to adopt extremely diligent conduct, especially in situations of corporate crisis. Good faith is not sufficient to exclude criminal liability for simple bankruptcy if the operations are grossly imprudent.

• Evaluate Realistically: Every decision during a crisis must be based on an objective and realistic analysis of the prospects of success.
• Act Promptly: Do not procrastinate in adopting the necessary measures for managing insolvency.
• Seek Advice: Rely on legal and financial professionals to evaluate strategies and implications.

The protection of creditors and the integrity of the economic system are primary principles. Directors are required to act with prudence and diligence, avoiding operations that, while aimed at delaying bankruptcy, lack real and well-founded prospects of economic success. Proper management of corporate crisis requires competence and awareness of legal responsibilities, which can lead to severe criminal consequences.