CAN A SHAREHOLDER CLAIM COMPENSATION FOR HARM DONE TO THE COMPANY UNDER THE LAWS OF THE NETHERLANDS ANTILLES?
No derivate suit
If the assets of a company are impaired by a third party in a way that cannot be accepted by the law, e.g. an act of tort, and as a result of which the value of the shares in principle decreased, it is only the company that is authorized and entitled to take legal action against this third party. The shareholders of the company are not authorized and entitled to do so pursuant to the Dutch Supreme Court, December 2, 1994, NJ 1995, 288 in the case of Poot vs ABP: in this case it has been decided, summarized, that a shareholder cannot claim compensation for the decreased value of his shares in case the company may also claim this damage. In other words: no derivate suit.
In this respect it is noted by A-G Hartkamp in his statement that preceded the decision in the case of Poot vs ABP:
“In my opinion the consequence should be that the shareholder in principle cannot institute legal actions in private in order to protect his interest in the company. The shareholder derives the benefits from the institute of the company as legal entity (limited liability); he therefore also has to bear the burdens of it and he should leave the representation of the interests of the company to the company itself, or, in case of bankruptcy, to the bankruptcy trustee.”
In his dissertation ‘Compensation in case of wrongful act’ (1965, nr. 214, page 310), A.R. Bloembergen wrote that it ensues from the nature of the legal entity that a shareholder cannot institute legal actions himself and that the legal entity whose rights or interests are affected needs to take legal action itself. If the legal entity fails to do so, then the persons, who are entitled to or have an interest in its capital, should try to induce the company to take legal actions.
Karel Frielink
Attorney (lawyer) / Partner
