Case Study: Legal Constraints on Judicial Intervention in the Replacement of Company Liquidators in Greek Corporate Law

Analytical Commentary on Decision No. 1795/2021 of the Athens Court of First Instance

The present case study constitutes a critical legal analysis of Decision No. 1795/2021 issued by the Monomeles Protodikeio Athinon (Single-Member Court of First Instance of Athens, Voluntary Jurisdiction Division), in a matter concerning the legal permissibility and boundaries of judicial intervention in the appointment and replacement of liquidators of a dissolved societas Europaea in the form of a Greek anonymi etaireia (hereinafter: S.A. or A.E.). The decision examines the ratio legis and interpretive limitations of Article 786 para. 3 of the Greek Code of Civil Procedure (KPolD), juxtaposed with the corporate governance rules enshrined in Legislative Decree 2190/1920, which was applicable ratione temporis, and Articles 69, 73, 74 of the Greek Civil Code (AK).

The legal issue before the Court was not merely procedural but structural, concerning the institutional autonomy of the general assembly of shareholders and the inviolability of its exclusive competences in corporate liquidation procedures.

The applicant, a shareholder of the dissolved S.A. under the corporate name “EFFER ELLAS ANONYMI EMPORIKI & TECHNIKI ETAIREIA A.E.” and the distinctive title “EFFER ELLAS A.E.,” filed a petition under the provisions of Articles 739, 740 and 786 para. 3 KPolD. He requested the judicial removal and replacement of two liquidators who had been appointed by the General Assembly of the company on 02.12.2008, following the company’s dissolution.

The relief sought included the substitution of said liquidators with the applicant himself and a third party, Mr. Konstantinos Zigas, on the grounds of persistent neglect of their statutory duties and obligations derived from their status as liquidators. The applicant further requested that the costs of the proceedings be imposed on the respondents.

The respondents contested the petition both procedurally and substantively, invoking (a) the lack of jurisdiction and competence of the court to intervene in the acts of the general assembly concerning corporate governance matters during liquidation, and (b) the inadmissibility of the application due to the applicant’s failure to include his Tax Identification Number (A.F.M.) as required under Article 118 KPolD as amended by Law 4335/2015.

The decision squarely addressed the following cardinal legal questions:

1. Does the jurisdictional provision of Article 786 para. 3 KPolD empower the civil courts to remove and replace liquidators of a société anonyme when they were appointed by the General Assembly of shareholders?
2. Does the omission of the applicant’s A.F.M. (Tax Identification Number) render the application inadmissible pursuant to Article 118 KPolD and established procedural jurisprudence?

A. On the Permissibility of Judicial Replacement of Liquidators

The Court undertook a meticulous exegetical analysis of Article 786 para. 3 KPolD, which allows for the judicial appointment or replacement of administrators (or liquidators) in the absence of valid organs or due to urgent need. However, the Court stressed that this provision applies only when the appointment was made by judicial order or where the company lacks a functioning governing body capable of acting lawfully.

In the instant case, the liquidators whose removal was sought had been lawfully and properly appointed by the General Assembly pursuant to Article 34 para. 1 and Article 49 of Legislative Decree 2190/1920. Consequently, their removal fell squarely within the exclusive competence of the General Assembly, which retains full corporate governance authority during liquidation.

The Court reaffirmed the well-settled principle that the General Assembly of an S.A., even in liquidation, remains the supreme organ of the company and continues to exercise oversight and control, including the right to appoint and dismiss liquidators (cf. Efpir 1068/2007, NOMOS). This interpretation aligns with the doctrinal structure of corporate autonomy and separation of powers between internal governance and judicial authority.

As such, the invocation of Article 786 para. 3 KPolD was rejected as inapplicable, and the petition deemed substantively inadmissible.

B. On Procedural Admissibility under Article 118 KPolD

In addition to the substantive barriers, the Court considered the procedural defect stemming from the applicant’s failure to include his A.F.M., as mandated by Article 118 KPolD. This provision, especially after its amendment by Law 4335/2015, codifies the essential formal requirements for the admissibility of procedural acts.

While certain jurisprudence has accepted post hoc corrections of such omissions (under the principle of non-substantial nullity), the Court held that the omission of the A.F.M. constitutes a fatal procedural flaw unless rectified within the filing.

Moreover, the applicant had not demonstrated any procedural harm or “dikonimiki vlavi” (δικονομική βλάβη) suffered by the respondents, but the defect nonetheless reinforced the Court’s rejection of the application on both admissibility and substantive grounds.

The decision illustrates the delicate balance between corporate self-regulation and judicial oversight. It reinforces:

• The exclusive nature of shareholder authority under company law, especially as codified in Articles 48, 49 of L.D. 2190/1920 and sustained in Law 4548/2018.
• The restrictive interpretation of Article 786 para. 3 KPolD, which is not a general remedy but a special jurisdictional mechanism for exceptional cases involving defunct or non-functioning corporate bodies.
• The formalistic yet functional role of procedural identification (A.F.M.) as a gateway requirement for admissibility.

It further reflects the Greek judiciary’s reluctance to override private ordering mechanisms embedded in corporate law, unless an explicit legal foundation permits such intervention.

Decision No. 1795/2021 is emblematic of the Greek legal order’s commitment to respecting the autonomy of corporate entities, particularly in liquidation. It also affirms the principle that judicial intervention in internal company affairs is permissible only within the confines of express statutory authorization.

For legal practitioners, the case reinforces the necessity of procedural precision (Article 118 KPolD), the strategic importance of understanding the boundaries of voluntary jurisdiction (Articles 739 et seq. KPolD), and the obligation to exhaust intra-corporate remedies (e.g., convening a General Assembly) before resorting to judicial recourse.

The decision serves as a benchmark for future litigation involving contested corporate liquidations and the judicial role in their oversight.

• Greek Code of Civil Procedure (KPolD), Articles 118, 739, 740, 786.
• Greek Civil Code (AK), Articles 69, 73, 74.
• Legislative Decree 2190/1920, Articles 34, 48, 49.
• Law 4548/2018 on Sociétés Anonymes (post-2019 reform).
• Law 4335/2015 (amendments to civil procedure).
• Efpir 1068/2007 T.N.P. NOMOS.
• Alexandridou, Eleni (2016), Dikaio Emporikon Etaireion, 2nd ed., Nomiki Bibliothiki.
• Tzoufi, Ioanna (2019), “Oi Ekatharistes kai to Dikastiko Metro Epemvasis”, Nomiko Vima.
• Delikostopoulos, Antonis (2020), Civil Procedural Law: Voluntary Jurisdiction, Sakkoulas.