The fundamental principle upon which corporate law is based is the rule concerning the separate and distinct legal personality of a company. This means that a company, in a legal sense, is a special, independent, and autonomous legal entity capable of acquiring assets, rights, and obligations. However, unlike persons who directly undertake legal and material actions, it is not possible for companies to do so. Instead, all actions on behalf of and for the benefit of the company are taken by individuals holding positions within the company and authorized to do so (company bodies).
One of the basic duties of any individual holding a position in a company is to act in the best interest of the company, i.e., to act with a reasonable belief that they are acting in the best interest of the company. This implies the obligation to prioritize the interests of the company over personal, individual interests. The duty to act in the best interest of the company entails several specifically defined obligations, one of which is the duty of care. The duty of care requires the cumulative fulfillment of three conditions: acting with a reasonable belief that one is acting in the best interest of the company, acting in accordance with the principle of diligence, and acting with the necessary degree of attention, which is the degree of attention of a prudent businessman. These legal standards are concretized in each individual case when the need arises.
The duty of care applies to the following individuals: directors, members of the supervisory board, representatives, procurators, and liquidation managers. These are individuals who represent the company and manage its operations and, when performing such actions, must act with the necessary degree of care. Otherwise, they will be obliged to compensate for the damages resulting from such a breach.
If individuals with the duty of care breach their obligations, the company may file a lawsuit against such individuals and seek compensation for the damages suffered by the company due to the breach of that duty. It is important to note the deadlines for filing a damage claim, which are 6 months from the discovery of the breach (subjective period) and 5 years from the act of the breach (objective period). The same applies to the company members, who may also suffer material damage due to the breach of specific duties toward the company, and in such cases, the members can have the status of actively entitled persons and claim the damage they have suffered.
The breach of the duty of care causes damage directly to the company but indirectly to the members of that company. Practically, this means that a lawsuit for damages can be filed by the company, but also by the members of the company in their own name but for the benefit of the company. To file a derivative lawsuit, certain legal conditions must be met regarding the percentage of significant participation in the capital on the part of the members, as well as regarding the expiration of the deadlines for filing the lawsuit by the company itself. That is, the right of the company members to claim damages suffered by the company is subsidiary in nature and can only be exercised if the company does not independently file such a lawsuit.
This type of lawsuit is defined by abstract legal standards in the law, which must be concretized appropriately in each individual court proceeding. This process inevitably requires continuous professional support and assistance from an attorney familiar with the principles of company operations.