Monday, 18 April 2016 00:00

Failure or window (review the provisions of the company resolution effect)

In anticipation of the supreme people's court on some issues of applicable  company law of the People's Republic of China regulations (four) "(hereinafter referred to as" four "judicial explanation) released on April 12, the final draft of the draft (hereinafter referred to as" the draft "), to solicit comments from all social public.

Said the long-awaited, because four long-simmering judicial interpretation, 2009 by the supreme people's court issued a draft for the first time, as a professional study of corporate lawyers, in the practice of the judicial interpretation is needed support for litigation practice, seven years has been tracking, pay attention to the judicial interpretation rounds of modification, and participated in the 2015 expert opinion draft (the draft not public in society). But even so, this paper introduced still surprising, corporate resolution effect part alone enlargement to article 12, in modifying some people think that "surprise", some people think that "fresh".

The author thinks that the foundation of judicial interpretation of the introduction of four first based on "company law" on the explanation to the application of the law; the second is to adapt to social development, the lagging of legislation (the author believes that the legislation lag is characteristic of the law itself rather than disadvantages) under the condition of justice do limited development and exploration. But the legitimacy of judicial interpretation is always the first one, innovation requires strict control under the existing laws and basic legal constraints, can not be any "law making". The draft of the first part is "on the company's shareholders or the shareholders' meeting, board of directors of the effect of the resolution of cases", in addition to the original "company law" provisions of article twenty-two of the company and the effect of the resolution of revocation invalid, but also a new resolution does not exist, the resolution is not in force, behavior preservation and other content, to the "company law" is and expand the great innovation, not only highlights, but also has the flaw, based on the comparison before and after the manuscript, only this draft resolution, part of effectiveness review, and proposed amendments and their peers:

Of the first (the plaintiff)

Shareholders, directors, supervisors and the content of the shareholder meeting, board of directors has direct interests with the company senior management personnel, employees, creditors, etc., according to the lawsuit filed by the company law article 22 (1) to confirm the resolution invalid or effective, shall accept it according to law.

Company law of subparagraph 1 of article 22 of the "company shareholder meeting, the content of the resolution of the board of directors violates the laws and administrative regulations is invalid." What subject can claim, no clear resolution is invalid, this also is the practice of the provisions of this value. The author thinks that: the paper than on a draft (refer to the expert opinion manuscript in November 2015, the same below) more enlarged the scope of the plaintiff, mistaken. Compared on a draft of the 2009 draft by the "employees" shrinkage limit for "senior management" is reasonable and necessary, because executives itself is the adjusting object of company law, and such as appointment and removal of executive, the implementation of equity incentive plan are related to the lawful rights and interests of executives, shall be used as the litigant lawsuit main body; But the general staff (here use "employees" as if the planned economy era), not as the lawsuits. First of all worker to adjust the object does not belong to the company law, if the worker rights are violated by labor law and labor contract law and other laws and regulations, do not need to confirm the company resolution to rights. The second company shareholders (shareholders), the board of directors does not fall within the scope of the general staff know, even if its the rights granted, resolution can be made within 60 days know and filed a lawsuit is a reality problem. Third, the unlimited expansion of the scope of the subject of litigation, it is bound to cause rampant litigation, leads to resolution not made in accordance with the normal, seriously affect the normal operation of the company. The plaintiff should be paid attention to legislative and judicial balance between rights and corporate interests.

As to whether the creditor as the litigation of the plaintiff, is likely to be the supreme people's court for a particular situation space reserved rights. The author thinks that the creditor can be based on any other provision of the company law or through other legal origin to maintain their legitimate rights and interests, and should not to veto the resolution company way. Can anticipate a situation is, even with the company creditors is just a business contract dispute, also by bringing your company suit is forcing firms to compromise, huge damage to the company, also obviously violate principles of fairness and justice, therefore, creditors of should not be listed as the plaintiff.

Therefore, the worker, creditors of should not be included in the scope of the plaintiff.

【Amendments】 this paragraph is unified use of italics, and in this paper the difference of amendments highlighted in the underline, hereinafter the same)

Shareholders, directors, supervisors and the content of the shareholder meeting, board of directors has direct interests with the company senior management personnel, employees, creditors, etc. (delete), according to the lawsuit filed by the company law article 22 (1) to confirm the resolution invalid or effective, shall accept it according to law.

Article 2 (revocation litigation of the plaintiff)

According to the lawsuit filed by the company law in the second paragraph of article 22 of revocation of the shareholder meeting, board of directors of the plaintiff, should be in charged with the shareholders of a company's identity. Cases after no longer, the identity of the shareholders of a company shall dismiss such suit.

This change has been clear about the plaintiff shareholder identity, is the summary of effective judicial decisions in recent years and certainly, has positive significance. Therefore, no objection

Article 3 (the litigation status of the parties)

The plaintiff sued the request to confirm the provisions of article 4 resolution does not exist, this provision is not an effective resolution as stipulated in article 5, and confirm the resolution was invalid, or revoke the resolution case effectively, should be listed company as the defendant.

Before the end of the trial court debate with others the same as the plaintiff's claims application to participate in litigation, the litigation subject qualification in accordance with the civil procedure law, company law, shall be listed as the plaintiff together.

1 the company as a defendant in accordance with law, have no objection, but don't think there should suit does not exist, is not an effective resolution, reason can be found in the fourth, article 5 of the modification of reasons.

Basic agree with the second paragraph, but should distinguish is shareholder as the plaintiff of the plaintiff or any other identity, because shareholders and creditors by both identity and on the basis of legal facts and legal basis are different, shall be respectively.

"Changes"

The plaintiff sued the request to confirm the provisions of article 4 resolution stipulated in article 5 of this provision does not exist, not form effective resolution, and (delete) confirm the resolution was invalid, or revoke the resolution case effectively, should be listed company as the defendant.

Other shareholders or creditors before the end of the trial court debate as same as the plaintiff, the same lawsuit request application to participate in litigation, the litigation subject qualification to comply with the provisions of the civil procedure law, company law, shall be listed as the plaintiff together.

Article 4 (resolution) is not present

These provisions prescribed in the first article of the plaintiff has evidence to prove the existence of dispute resolution is one of the following circumstances, the request to confirm there is no resolution, shall be supported:

the company did not hold the shareholder meeting, board of directors, but the company shall, in accordance with paragraph 2 of article 37 of law or the provisions of the company's articles of association is not the shareholder conference and make a decision directly, and sign the documents of approval by the shareholders, unless the seal;

the company shareholder meeting, board meeting, but did not vote on the resolution.

The author thinks that the clause appears realistic necessity, in the previous version of the discussion was proposed to distinguish resolution invalid with pending validity, but not as described by this paper. As described above for proof that the plaintiff did not convened meetings or no vote, the actual is to let the plaintiff proves that there is no legal fact, contrary to the basic legal logic. The plaintiff may bring the suit, but the burden of proof lies in the company, the company needs to prove is carried out in accordance with the law or the articles of association convene the meeting and a vote, if not proof, to confirm resolution does not exist, in order to support the plaintiff's claims.

But there is no evidence based on the plaintiff's case, whether the proposition is actionable? So presumably in reality the plaintiff is necessarily holding company shareholders (shareholders), the board of directors (even a copy) to prosecute, think meeting convened, process was flawed, or although convened the meeting, but did not vote or voting was flawed. Such a case, I think still belongs to the company's resolution process defects, no need to "confirm resolution does not exist", you can directly in accordance with the company law in the second paragraph of article 22 to apply for revocation of the resolution.

"Changes"

Delete this clause or both as resolution revocable enumerated type, the second paragraph of article 22 of the company law shall apply.

"Extended thinking"

If the plaintiff can be filed for ordered the company to convene the meeting and make a decision?

Article 5 (not effective resolution)

Company shareholder meeting, board meeting and make a decision, but these provisions prescribed in the first article of the plaintiff has evidence of the following circumstances, the request confirmation did not form effective resolution, shall be supported:

Attend the meeting or the number of voting rights held by the shareholders do not conform to the prescribed in the articles of association;

Resolution ratio does not conform to the law or the provisions of the company's articles of association;

Part of the signature was forged on the resolution, and forge the signature of the shareholders or directors approved;

Another point: the resolution on the part of the signature was forged, and forge the signature of the shareholders or directors, after the removal of forged signature by proportion is not in conformity with the law or the provisions of the company's articles of association;

the content of the resolution beyond the powers and authorities of office of the shareholder meeting, board of directors.

The author believed that this subparagraph (a) is still a meeting convened, was flawed. "Company law" article 43 regulation, the discussion methods and voting procedures of the shareholders' committee, in addition to the prescribed in this law, shall be prescribed by the articles of association. In the absence of law or the number specified in the articles of association or shareholding, the meeting is not legally binding, the resolution also are naturally resolution. So the remove or merged with the provisions of article 4, the litigant centralized listed as resolution revocable. (2), (3) is established on the basis of the meeting shall be convened effectively, the formation process of resolution was flawed. The above three conditions are revocable resolution, but from the perspective of improving business efficiency, judgment of the court trial idea doesn't want to such cases shall be revoked, the relevant provisions of the contract law, should belong to the resolution of with pending validity, can be combined with article 8 of the regulations, for the resolution of the shareholders subsequent ratification or expressed in action recognition, should be included in the resolution is legal, appropriate consideration scope prescribed by the articles of association; Also should be allowed to company in the process of litigation of program defects to be corrected.

(4) resolution of the resolution beyond the scope of authorization, belong to the same resolution with pending validity. The board of directors by the shareholders' committee authorized to cover program; The shareholders' committee resolution strictly as long as related to the company, with the shareholder resolution shall have the right to make, because the company law (11) is the thirty-seventh article "and other functions and powers stipulated by the articles of association", and most of the articles of association rules out terms, will be the major issues of the company or shareholders that are listed in the category of the shareholders' committee resolution, unless with the national laws, administrative rules and regulations inconsistent but if in violation of the law and administrative rules and regulations of the company law shall be applicable paragraph 1 of article 22, decided that the resolution was invalid.

Therefore suggested that the mediation should be done firstly in such cases, the company did not make up for the program of the defect or within a time limit under the condition of without authorization, beginning sentence resolution revoked. This on the one hand manifests the tolerance principle in the judicial, respect the autonomy of commercial subject; Rampant litigation on the other hand also can avoid the right subject, make the company long-term resolution is in unstable state, affect the company's normal operation.

So my personal view is that while you can use the concept of "contract law" with pending validity, but not by the other filed, sentence "is not an effective resolution. Reason: the legal facts allow ratification with pending validity, without necessary shall withdraw; If according to the provisions of this article set up a new civil by the court decided that did not form effective resolution, only to a state of facts, and can't actually solve the plaintiff filed for (objectively deterrent effect and implementation of the resolution involved in), and the court also shoulds not be direct judgment against defendant in accordance with the provisions of the articles of association of the company deadline make corresponding decision, otherwise the company's internal management transition intervention.

"Changes"

Delete this clause or both as resolution revocable enumerated type, the second paragraph of article 22 of the company law shall apply.

Article 6 (resolution invalid reason)

The shareholder meeting, board of directors is one of the following circumstances, shall be invalid.

Shareholders resolution by abusing the shareholder rights damage the interests of the company or other shareholders;

Resolution excessive profit distribution, a major such as improper associated transactions lead to damage to the interests of creditors;

The content of the resolution that violate the provisions of other laws and administrative regulations, mandatory.

This article is based on the company law article 22 of the first paragraph "company shareholder meeting, the content of the resolution of the board of directors violates the laws and administrative regulations is invalid." Which correspond to a draft article 4, the biggest difference is to clarify the resolution null and void and revocable. Defect is no longer treated as invalid resolution program. Keep the first (a) to protect the interests of small shareholders, (2) is conducive to protect the interests of creditors.

In sub-paragraph (1) from the first paragraph of article 20 of the company law, is conducive to protect the interests of small shareholders, there is a legal basis.

The first paragraph (2) the logic chaos, lack of legal basis, and there are beyond any suspicion of the company law, is the biggest failure in this paper. Resolution invalid can only according to paragraph 1 of article 22 of company law, illegal content of laws and administrative regulations, the resolution is able to think as invalid, should expand the scope of invalid. The distribution of "excessive profits... cause damage to the interests of creditors", what is too much? The shareholders' committee resolution as long as the profits distributed in accordance with the law, such as the "company law" the one hundred and sixty-sixth regulation) and the company's articles of association, even if the distributable profit all light, does not consider the company's long-term development, is also a shareholder's free will choice the judiciary should not intervene. The motion, tabled by the motion of general should be the dissenting shareholders, but the rule is to protect creditors, legal theory. If the resolution itself is not illegal, also not in violation of the principle of capital maintenance (such as the action resolution), how to allocate profit had nothing to do with creditors. So, I think the legislative intent of here should resolution refers to the company in violation of the company law article one hundred and sixty-six, paragraph 4, and about the distribution of after-tax profits when it shall draw 10% profit accumulation fund company regulation, if the company don't have to extract the statutory reserve fund in accordance with the law or before make up for the loss allocation of profits, should belong to the violation of law or violating the company's articles of association rules, the resolution was invalid, is whether the logical or natural law.

If the purpose of this article is to protect the minority shareholders of surplus division, here should be refers to the company (mainly the controlling shareholder) use of capital majority, excessive extraction of arbitrary accumulation fund, causes a decline in the distributable profit is zero, even damage the interests of minority shareholders. This kind of situation can be included in subparagraph (a).

"The first two (2) a major improper associated transactions such as" damages thus caused to the interests of the creditors are important logical problems. "Company law" article 21. The regulation of "the company's controlling shareholders, actual controllers, directors, supervisors and senior management personnel shall not use its relationship to damage the interests of the company." Here can see clear, improper connection transaction object is the company's direct damage, collateral damage is the interests of shareholders, so the company law allows shareholders for such indirect infringement lawsuits. So, I don't think the provisions of the company law, the law does not give creditors to that company resolution invalid rights, practice is also difficult to demonstrate the appropriate company resolution and damaged the interests of the creditors have a direct causal relationship. Contrary to the provisions in article 20 of the company law, "prohibit abuse of shareholders or the company by abusing the shareholder rights legal independence and limited liability of shareholders damage the interests of creditors." Damage to the rights of creditors if it is thought that may be on the basis of which filed a dispute over responsibility to shareholders damage the interests of the creditors "proceeding.

Through judicial interpretation to strengthen the protection of company creditors has profound practical significance, but the excessive profits distributed listed in this article, the improper associated transactions are not typical behavior of damage the interests of the creditors. "Significant" and "excessive" lack of objective criteria, rely on the discretion of the judge, even if the final judicial interpretation retains two, also dare not easily lead to court convicted, don't want to.

"Changes"

Split into two section (2) is amended as:

Resolution (2) of the company in violation of the company law, the fourth paragraph of the first paragraph of article one hundred and sixty-six, illegal distribution of profit;

(3) the shareholders or the company by abusing the shareholder rights abusing independent legal person status and resolution of the shareholders of a limited liability to make creditors damage;

Article 7 (decision to cancel the reason)

Company law referred to in paragraph 2 of article 22 "called the program" and "vote", including the shareholder meeting, board of directors meeting notice, equity registration, proposal and agenda, host, voting, counting, voting announced the results, the formation of the resolution, and the meeting record and sign.

Modify the articles of association of the effective resolution does not belong to the second paragraph of article 22 of the company law provisions of "the content of the resolution in violation of the company's articles of association".

The provisions of this article is very necessary, no objection

Article 8 (later agreed to resolution)

Shareholders sued for canceling the shareholder meeting, board of directors, there is evidence of the following circumstances, the company should be dismissed the claims:

After the decision, the shareholder made it clear that agree with the content of the resolution;

After the decision, shareholders with their own behavior made it clear that accept the content of the resolution;

To make a new resolution, real recognition of shareholder litigation request.

This increase is very necessary. But suggest refinements, and add a, allowing companies to making up after the plaintiff sues.

"Changes"

Shareholders sued for canceling the shareholder meeting, board of directors, the company there is evidence of the following circumstances, the resolution shall be deemed as defects have been corrected, resolution effectively. To whether the plaintiff's interpretation of the Ming court shall withdraw the prosecution, the plaintiff does not agree with the decision, the decision to dismiss claims:

After the decision, sealed by the shareholders to retroactive name, or by letter, email or other written explicitly agreed to the content of the resolution;

After the decision, shareholders with their own behavior made it clear that accept the content of the resolution;

Otherwise make a new resolution, real recognition of shareholder litigation request.

Increase a: the company, after the plaintiff sued the first-instance trial by the above before the end of (a) (2) (3) making up the behavior of the circumstances shall be allowed, after submit relevant evidence can be dealt with reference to the first paragraph, but costs shall be borne by the company.

Article 9 (resolution effect directly decided)

The plaintiff sued the request to confirm the shareholder meeting, board of directors does not exist, is not an effective resolution, the resolution was invalid or revoke the resolution, and the cognizance of the people's court according to the case facts made not consistent, shall make a decision directly.

Another view: the plaintiff sued the request to confirm the shareholder meeting, board of directors does not exist, is not an effective resolution, the resolution was invalid, or revoke the resolution, and according to the case facts in accordance with the law of the people's court decided that the resolution of effectiveness is not consistent, the plaintiff may change the claims shall be informed. The plaintiff does not change, it shall be rejected claims.

On a draft resolution is that company cancel the suit and invalid lawsuit can mutual transformation, a controversial, the idea of this modified gave up the idea, but confirmation of the people's court can be directly determined the effectiveness of the resolution. The above two point of view, the first emphasis on judicial efficiency; The second kind of pay more attention to the program is rigorous. I agree with the second view, because the cancellation of the resolution in both litigation subject and legal basis for the two very different, cannot transform at will, can't even by the judge to decide. So the situation, the judge should be shi Ming, in the case of the plaintiff is not willing to change his claims, dismissed the action. Even at the risk of v. tired, but we can not sacrifice the procedural justice.

But the author does not recommend resolution, whether an effective resolution to distinguish whether there is (the reason such as before), but is still carried out in accordance with the cancellation and the invalid.

"Changes"

The plaintiff sued the request to confirm the shareholder meeting, board of directors does not exist, is not an effective resolution, resolution (delete) resolution invalid or revoked, and according to the case facts in accordance with the law of the people's court decided that the resolution of effectiveness is not consistent, shall be shi Ming, told the plaintiff may modify his claims. The plaintiff does not change, it shall be rejected claims.

Article 10 (behavior)

The shareholder meeting, board of directors have after implementation can not recover, or make the legitimate rights and interests of the parties and interested persons case of irreparable damage etc, can according to the ban on the implementation of relevant resolutions of the plaintiff's application.

Take the act preservation measures specified in the preceding paragraph, the people's court may according to the application of the company or in accordance with the authority to order the plaintiff to provide corresponding guarantee. The plaintiff to provide corresponding guaranty, it shall be forbidden to implement relevant resolutions.

After examination, the people's court considers that the plaintiff's application implementation situation of malicious interference or delay resolution, shall be rejected.

This reference to the revised "civil procedural law" article one hundred and one of the regulations concerning litigation preservation, is very necessary. The first is an injunction application in company lawsuit. In the second paragraph is guarantee of litigation preservation. In the third paragraph suggest increase the company's right to relief.

"Changes"

The third paragraph of this article is amended as: after examination, the people's court considers that, the plaintiff's application for malicious interference or delay resolution implementation situation, should be rejected. Company has suffered damage because of act preservation, companies can counterclaim or prosecution claim for damages.

Article 11 the retrospective (decisions)

The people's court for ruling the shareholder meeting, board of directors does not exist, is not an effective resolution, the resolution was invalid or revoke the resolution, the resolution from the beginning is not legally binding.

Tell from legal principle, the resolution was invalid or revoked are not legally binding from the beginning, so be careful resolution, more should not be on expanding our scope of resolution is not legally binding, to avoid the uncertainty of business subject to add more.

[changes] of the people's court ruling the shareholder meeting, board of directors does not exist, is not an effective resolution, the resolution (delete) invalid or revoke the resolution, the resolution from the beginning is not legally binding.

article 12 (reference applicable)

The people's court for a one-person limited liability company on the basis of article sixty-one of the company law, the decision made by the state-owned assets supervision and administration institution according to exercise the power of the shareholders' committee of article sixty-six of the company's decision effectiveness dispute cases, can be reference to the present provisions shall be applicable to the article 1 with a view to the relevant provisions of article 11.

In this article.

To sum up, this paper has a distinct positive significance, can clarify some confusion and difficulty in judicial practice, have guiding significance for judicial practice. But during yoga mixed, highlight and failure, especially the company decision effectiveness, innovation strength is big, but it is to be careful in the judicial interpretation, trespass host law regulation, the method of logical confusion, even without which are unacceptable, the rectification Suggestions.

Author: GaiXiaoPing lawyer, haihua yongtai law firm in Shanghai This email address is being protected from spambots. You need JavaScript enabled to view it.