The impact of the principle of "where there is no plaintiff, there is no judge" in stock corporation law and its exceptions
Introduction
In the world of private law, which includes stock corporate law, there is a principle that is often quoted in passing but whose importance should not be underestimated: "Where there is no plaintiff, there is no judge." This principle reflects the assumption that in a well-meaning and trusting community, legal disputes do not arise because all parties trust that their interests will be respected. Furthermore, it is also somewhat reckless to trust that the person whose rights have been violated does not know this or is unaware of the legal instruments available to him and therefore does not claim his rights. And even more reckless is anyone who relies on the fact that the person whose rights have been infringed will not bring an action because of the expense or cost involved, fully aware of the infringement. However, in the complex reality of the business world, particularly with regard to general meetings (AGMs) and board meetings (BoD meetings), this principle should be considered with caution.
Not a judge, but...
Many board members may find it tempting to disregard the formal requirements of an AGM or board meeting, especially if the participants are considered to be well-meaning. However, this is a dangerous misjudgment. In the case of resolutions on amendments to the articles of association, for example, it must be noted that these must be publicly notarized by a notary and submitted to the commercial register for registration.
Notaries and the commercial register meticulously monitor that all formal requirements are adhered to and that both the law and the articles of association are respected. In doing so, the notary is in a guarantor position - he has the duty to ensure that the resolutions have been passed in accordance with the law. These exceptions to the principle of "where there is no plaintiff, there is no judge" serve to protect trust in business and legal transactions and to ensure that evidence is clearly preserved.
... indispensable legal conformity
In view of these exceptions, it is clear that compliance with all legal and statutory requirements for the agenda, convening, holding and recording of a general meeting or board meeting is of crucial importance for general meetings and board meetings that entail changes to the commercial register. In the context of capital increases, election of the auditors, relocation of the registered office, changes of purpose or other amendments to the Articles of Association as well as the election and re-election of members of the Board of Directors, the Board of Directors must therefore ensure the legal conformity of the resolution of the meeting in order to obtain the desired change in the commercial register. Neglecting formal requirements could jeopardise not only the trust of shareholders, but also the integrity of the company as a whole. It is therefore essential that boards of directors and company managements pay careful attention to these aspects and are fully aware of the limits of the "where there is no plaintiff, there is no judge" principle.
Konsento, as a dedicated LegalTech platform for corporate action, is committed to this claim and enables the efficient and legally compliant organization and conduct of general meetings and board meetings. To date, over 120 general meetings and 60 board meetings have been held on the Konsento platform, around a third of which have resulted in resolutions that were notarised online by a notary. Konsento thus sets a standard for legal compliance, user-friendliness, and transparency in company resolutions.
Contact us now for a free initial consultation on the legally compliant organization of your next Annual General Meeting.
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