The Dutch Supreme Court has ruled today that the complaint obligation does not apply to internal director liability under Article 2:9 Dutch Civil Code.
The first argument presented by the Dutch Supreme Court is the specific nature of the relationship between a director and the legal entity, which is a corporate legal relationship. With the appointment of a director as such, a corporate legal relationship is established between that director and the legal entity, which entails that the director is bound by law and custom, and the statutes, regulations, and resolutions of that legal entity. This binding also pertains to Article 2:9 paragraph 1 of the Dutch Civil Code, which stipulates that every director is obliged to properly fulfill their duties towards the legal entity. A director who fails to properly perform their duties is liable if a serious blame can be attributed to them.
From this, the Dutch Supreme Court concludes that the complaint obligation under Article 6:89 Dutch Civil Code, which normally applies to contractual obligations, does not apply here. Article 6:89 BW states that a creditor can no longer invoke a defect in performance if they have not protested to the debtor within a reasonable time after discovering the defect or ought reasonably to have discovered it.
A second argument by the Supreme Court against the application of the complaint obligation is that it cannot be held against the legal entity that the director fails to complain about their own mismanagement while still in office. This also applies to co-directors, particularly given the collegial relationships within the board.
For the full ruling of the Dutch Supreme Court: ECLI:NL:HR:2024:681.
