Context and Factual Background
The Specialized Tribunal in Cluj opened simplified insolvency proceedings against the debtor company. The finalized table of creditor claims included a claim from the Cluj-Napoca Regional Directorate for Public Finance (DGRFP) for additional assessed VAT. The company had been registered as a VAT payer though it never exceeded the registration threshold, and the statutory administrator mistakenly believed the company was not VAT-registered. Consequently, quarterly VAT returns were filed as if the company were not a VAT payer.
Inside the proceedings, the judicial liquidator did not find any suspicious transfers over the two years preceding insolvency. The liquidator’s report pointed to external, objective causes for the insolvency. Nonetheless, the DGRFP lodged a claim seeking personal liability for the former statutory administrator under Article 169(1)(a), (c), and (d) of Law 85/2014, based on the unchallenged VAT enforcement decision.
Legal Grounds for Liability — Article 169 of Law 85/2014
Under Article 169(1) of the Insolvency Law, the syndic judge may hold company managers or other individuals liable for insolvency-related losses if they:
- (a) used company assets or credits for personal benefit;
- (c) continued business activities that visibly led to insolvency for personal interest;
- (d) maintained fictitious accounting, destroyed or failed to keep accounting documents in accordance with legal requirements. Failure to submit accounting documents to the administrator or liquidator creates a rebuttable presumption of fault and causal link.
Court’s Analysis of Liability Conditions
1. Misuse of Company Assets for Personal Gain (Art. 169(a))
- Legal Requirement: Clear evidence that company assets were used for personal gain.
- Court Findings: Missing fiscal payments alone do not prove personal benefit. No suspicious transfers were identified.
- Conclusion: Condition not met.
2. Continuing Business in Personal Interest (Art. 169(c))
- Requirement: Proof that the administrator continued company operations to their own personal benefit despite losses.
- Findings: While losses occurred, there was no indication of personal benefit via dividends, asset transfers, or other advantages.
- Conclusion: Not fulfilled.
3. Improper Accounting (Art. 169(d))
- Requirement: Evidence that accounting was fictitious, falsified, or improperly maintained.
- Findings: Financial statements and balance sheets were submitted; the liquidator reported no irregularities. The VAT filing error, though a fiscal fault, does not equate to fictitious accounting.
- Conclusion: Condition not met.
The syndic judge emphasized that VAT non-compliance alone—without proof of fraudulent intent—cannot substantiate personal liability for the administrator.
Verdict
The syndic judge dismissed the DGRFP’s request, concluding that none of the required conditions under Article 169(1)(a), (c), or (d) of Law 85/2014 were satisfied:
- No proof of personal use of company assets;
- No evidence of operating for personal interest;
- Accounting was maintained in compliance with the law.
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Read our article on holding administrators or others accountable for causing insolvency.