The limits of insolvency liability in co-operatives

Our colleague Jesús Redondo Blanco, head of the Restructuring department at Lener’s Valladolid office, analyses the limits of insolvency liability in cooperatives in today’s edition of Vozpópuli. He draws on Judgment 141/2026 of the León Magistrates’ Court, handed down in the insolvency proceedings concerning the Sociedad Cooperativa Lechera LAR, in which Lener represented the cooperative during the claims assessment phase.

The resolution sets out when a manager may be regarded as a de facto director and the extent of the liability of de jure directors.

• How to identify a de facto director: what matters are the functions performed, not the title listed on the organisation chart.

• Why the court did not extend liability to the governing board: its members took up their posts after the financial years in which the irregularities occurred; they had no accounting training, received no remuneration for the post, and placed reasonable reliance on the manager and on three audit reports containing an unqualified opinion.

• The role of the audit: for a board without a technical background, it is a key source of information. The court found that these reports were manifestly lacking in rigour, and this reinforced the exoneration of the board members.

It is a useful guide for many co-operatives, where the board is made up of the members themselves and day-to-day management is carried out by a professional manager.

Read the full article here ➡️  https://lnkd.in/e28KGvZy