In its judgment dated March 14, 2023 – I ZR 162/21, the Federal Court of Justice (BGH) addressed the question of whether and to what extent the managing director of a managing limited partner GmbH has a duty of care towards the KG (limited partnership).
The defendant was the managing director of U. GmbH, which, in turn, was a limited partner of D. GmbH & Co. KG. According to the partnership agreement, the exclusive right to manage the partnership belonged to U. GmbH. The debtor was structured as a public limited partnership (Publikums-Kommanditgesellschaft). The debtor raised investor funds to make them available to the now insolvent D. AG. D. AG was supposed to use the loans to acquire real estate. The debtor intended to make distributions to investors with the agreed interest payments from D. AG. According to the loan agreement between the debtor and D. AG, the debtor’s loan claims should be extensively secured.
Contrary to the contractual agreement, the loan claims of the debtor were only partially secured.
After the insolvency proceedings were initiated against the debtor, the plaintiff insolvency administrator sought reimbursement from the defendant for partial loan amounts. The Regional Court ruled in favor of the plaintiff. The defendant’s appeal was unsuccessful, so he pursued his goal of dismissing the lawsuit with the permitted revision.
Decision of the BGH: Claim for damages exists
The BGH affirms a claim for damages by the plaintiff against the defendant under Section 43(2) of the German Limited Liability Companies Act (GmbHG) due to negligent management since the KG (limited partnership) falls within the scope of protection of the organizational and employment relationship between the GmbH and the defendant.
A protective effect in favor of third parties is assumed whenever a third party comes into contact with the main performance as intended, and the creditor has a legitimate interest in including the third party within the scope of the contract’s protection. Furthermore, there must be a need for extending protection based on good faith (Treu und Glauben). Additionally, the inclusion of the third party must be known or at least recognizable to the party to be protected. In this case, all of these conditions are met.
The KG came into contact with the defendant’s services as intended. Therefore, errors made by the defendant affected the KG.
The interest of the employing GmbH was that the defendant should exercise proper management of the KG as part of his organizational duties. This is especially the case because the GmbH is liable for damages resulting from the breach of the management tasks it had undertaken for the KG.
The extension of contract protection was also justified by a need based on good faith. Due to the contractual provisions, the defendant’s breaches of duty directly affected the KG. Consequently, the KG relied on the defendant’s conscientious and careful performance of his duties, particularly since the KG did not have the authority to give instructions to the defendant, which rested with the managing GmbH.
These circumstances were also recognizable to the defendant. The BGH now answers the previously open question of whether a managing director’s liability to the KG under Section 43(2) of the German Limited Liability Companies Act (GmbHG) is applicable even when the management of the KG is not the sole and essential task of the GmbH, with a “yes.” In such cases, there is sufficient recognizability for the managing director regarding liability for breaches of duty toward the KG. The liability risk is also recognizable when a GmbH and, therefore, the managing directors perform management duties in multiple companies. The KG can rely on the required care and diligence from the managing director in such cases as well.
According to the BGH’s perspective, a KG is included within the scope of the employment contract of the managing director and also within the organizational relationship between the GmbH and the managing director. The potential liability of the managing director to the KG does not depend on whether the managing director holds their position in a limited partner GmbH or a general partner GmbH, nor does it depend on whether the GmbH, in addition to its involvement in a KG, also manages other companies.