Corporate disputes and governance conflicts

Article 53.1 of the Russian Civil Code is a central rule governing civil liability of persons acting on behalf of a legal entity. It may apply to directors and members of governing bodies. Under Article 53.1(1) of the Russian Civil Code a director may be liable for losses caused to the company where the statutory conditions are established, including bad faith or unreasonableness in exercising powers or performing duties. Important guidance is contained in Resolution No. 62 of the Plenum of the Supreme Commercial Court of 30 July 2013 on bad faith and unreasonableness. The guidance addresses matters such as conflicts of interest, concealment of material information, transactions without required approval, failure to transfer documents, decisions taken without relevant information and departures from ordinary internal procedures. Potential claimants depend on the legal basis and may include the company itself or a participant bringing a derivative claim under Article 65.2(1) of the Russian Civil Code). Limitation periods and standing must be checked for the particular claim (Article 196 of the Russian Civil Code). A key issue is causation: procedural defects or a conflict of interest do not by themselves establish recoverable loss. The claimant must connect the alleged conduct to a specific financial consequence.

A claim for losses against a director under Article 53.1 of the Russian Civil Code and, where relevant, Article 277 of the Russian Labour Code requires proof of the legal elements applicable to the claim. The analysis starts with the specific conduct, the loss and causation. Examples may include transactions made without required corporate approval or interested-party transactions governed by (Article 81 of Federal Law No. 208-FZ, Article 45 of Federal Law No. 14-FZ); related-party transactions on non-market terms, transfers of assets without equivalent consideration, penalties caused by unlawful conduct, or other acts alleged to have harmed the company. Loss may include actual loss and lost profit under (Article 15(2) of the Russian Civil Code). Actual loss and lost profit must be quantified and linked to the director's conduct. The evidence may include the charter, internal approval rules, minutes, transaction documents, payment records, regulator materials, financial statements, valuation or other expert evidence and correspondence. Corporate claims are considered under the procedural rules applicable to corporate disputes. The state fee is determined under Article 333.21 of the Russian Tax Code according to the nature and amount of the claim. Interim measures against a director's property require a separate statutory basis and proportionality analysis.

A controlling person of the debtor is defined in Article 61.10 of Federal Law No. 127-FZ on Insolvency (Bankruptcy). The statutory test focuses on whether a person had the ability, within the legally relevant period, to give binding instructions to the debtor or otherwise determine its actions. Formal office, ownership and actual control may all be relevant. The assessment is fact-specific. Resolution No. 53 of the Plenum of the Russian Supreme Court of 21 December 2017 addresses how courts determine control from the totality of circumstances. Subsidiary liability in bankruptcy and a separate damages claim are different remedies. A derivative damages claim may also be available outside bankruptcy under the relevant corporate-law rules, including Article 53.1 of the Russian Civil Code a claim by the company or a participant for losses caused by a director or controlling person, where the statutory conditions for that claim are met.

Subsidiary liability and damages are distinct causes of action with different elements, presumptions, amounts and limitation rules. Combining them without separating the legal bases can obscure the issues. Subsidiary liability under Article 61.11 of Federal Law No. 127-FZ concerns liability for inability to satisfy creditors' claims where the statutory conditions and applicable presumptions are met. The potential amount is linked to the unsatisfied creditor claims, subject to the Bankruptcy Law's rules. A damages claim may instead arise under corporate law Article 53.1 of the Russian Civil Code or under Article 61.20 of Federal Law No. 127-FZ, depending on the circumstances. A damages claim focuses on specific loss and requires proof under the applicable liability model. For the defence, the evidential strategy therefore differs: subsidiary-liability presumptions must be addressed on their own terms, while a damages claim may turn heavily on loss, causation and the calculation methodology.