Anyone who is a director of a Spanish limited company has certain legal obligations (which is why the director is required to accept the position) and is therefore liable for its acts and omissions when they in any way damage the company itself, its partners or creditors, the three most significant interests for which the Spanish juridical system provides greater levels of legal protection.
In relation to the protection of business partners, due to their more family-oriented and private character, it is in the case of limited liability companies that conflicts between partners and the administration must particularly be avoided.
The most frequent cases involve the failure of the directors to comply with the obligation to request the company’s dissolution or bankruptcy when the company is required to do so due to the closure of the business, cessation of business activity, or insolvency.
Spanish law imposes on directors joint and several liability for debts and social obligations following the legal cause for dissolution, if they fail to comply with the obligation to call a general meeting within a period of two months to adopt, where appropriate, the resolution to dissolve, as well as on administrators who do not request judicial dissolution or, as applicable, proceedings for provisional insolvency, within two months following the scheduled meeting, when said meeting has not been constituted, or from the day of the meeting when the resolution would have been contrary to the dissolution.
In these cases, creditors’ claims will be assumed to date subsequently to the legal cause for dissolution of the company and may therefore be the responsibility of the directors, unless the directors can show that they are of an earlier date.
