Director pay without a shareholders' resolution: directors jointly liable for almost EUR 672,000
Who decides on a director's pay? If the articles of association say the general meeting does, a management agreement is no substitute. In a judgment of 31 March 2026, recently published, the 's-Hertogenbosch Court of Appeal held two corporate directors and their own directors jointly and severally liable for almost EUR 672,000.
The facts
The articles of association of a holding company and its operating subsidiary provided that the general meeting sets the remuneration of each director. Two directors, both management companies, raised their fees from an average of about EUR 8,000 to some EUR 13,000 to 14,000 per month. The resolutions that did exist had previously been declared null and void or annulled by the Enterprise Chamber.
Serious reproach for breaching the articles
The court of appeal considers that acting in breach of provisions of the articles that are intended to protect the company in principle constitutes a serious reproach within the meaning of Article 2:9 of the Dutch Civil Code. A claim to a higher reasonable fee under Article 7:405(2) fails, because the parties had already agreed on the amount of the fee. The management companies and their own directors (Article 2:11) are ordered to pay a total of EUR 671,900.20, jointly and severally, plus statutory interest. For the period in which they were suspended, the claim is rejected: the payments were then based on a new arrangement with the director appointed by the Enterprise Chamber.
What this means
A management agreement does not replace the remuneration resolution required by the articles. And anyone who serves as a director through a management company should be aware that, under Article 2:11, the liability passes through to them personally.
Practical tips
Check in the articles of association who sets the directors' remuneration, and stick to it.
Have every change in remuneration formally adopted by the competent body and keep the resolution on file.
Acting as director through a management company? Have your arrangement reviewed against the articles.
Questions about governance or director liability? See our specialisations or get in touch with us.
This blog provides general information and is not legal advice. For advice on a specific situation, please contact us.
