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Directors’ liability: Dutch Supreme Court 23 November 2012

23/12/2012

Directors’ liability: serious blame not required if liability is based on the breach of an independent standard of due care.

On 23 November 2012, the Dutch Supreme Court ruled that, also in the absence of serious blame, a director could under special circumstances be held liable by a third party on the basis of tort.

A Dutch company acted as an intermediary between purchasers and vendors of villa’s situated on the Spanish Costa del Sol. The director failed to notify the purchaser of the fact that the villa was built without a valid permit and that it would therefore likely be destroyed. The villa was indeed destroyed by the Spanish government after the purchaser had bought it.

The Dutch Supreme Court ruled that the director did not only fail in the performance of his duties as a director, but that he also had acted in breach of the standard of due care towards the purchaser, which standard was to be considered independently from his duties as a director. In such an event, the Dutch Supreme Court ruled that the standard rules of tort would apply and that therefore, the existence of serious blame would not be a requirement in order to establish the director’s liability.

Click here to read the judgment.

 

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