The Bottom Line
- Directors Face Full Personal Liability: A director found guilty of “seriously culpable mismanagement” is personally liable for all resulting damages, including funds used for personal expenses and unauthorized loans to third parties.
- Liability Extends to Enablers: Individuals and corporate entities that facilitate the misuse of funds or are unjustly enriched can be held jointly and severally liable for specific portions of the damage, creating a wide net of accountability.
- Damage Calculation is Meticulous: In follow-up proceedings to establish damages, courts will trace each wrongful transaction, calculate statutory interest from the date the damage occurred (not the judgment date), and apply specific legal rules to allocate any repayments made.
The Details
This ruling by the Rotterdam District Court concludes a complex case of director’s liability, moving from establishing guilt to quantifying the financial fallout. The proceedings, known in Dutch law as a schadestaatprocedure, followed an earlier judgment that found the former director of Scandica B.V. liable for serious misconduct. The court affirmed that the director treated company accounts as a personal treasury, siphoning off funds through direct transfers to an affiliated entity, financing personal home renovations, and issuing substantial, unauthorized loans to various third parties. This case serves as a stark reminder of the personal financial peril directors face when they breach their fiduciary duties.
The court’s primary task was to calculate the exact amount of Scandica’s losses, which were claimed to be over €1.7 million. It did so by meticulously breaking down the total damage into several distinct categories: over €609,000 in transfers to a co-defendant entity, more than €136,000 in home renovation and furnishing costs, and nearly €1 million in outstanding loans to five different individuals and companies. The court dismissed the plaintiff’s claim for a higher “commercial” interest rate of 5%, instead applying the statutory interest rate. However, crucially, it ordered this interest to be calculated from the dates of the original wrongful transactions—some dating back over a decade—significantly increasing the total amount owed.
Finally, the judgment carefully allocates liability among the three defendants and accounts for partial repayments. While the former director was held liable for the entire sum, the court confirmed that the entity receiving the improper transfers and its director were jointly and severally liable for that specific amount (€609,100 plus interest). Another individual was held jointly liable for their share of the unjust enrichment from the home renovations. The court then applied Dutch imputation rules (Art. 6:44 BW) to allocate repayments already made, directing them first toward the “most burdensome” debts, demonstrating a structured approach to unwinding complex financial misconduct.
Source
Source: Rotterdam District Court
