Unfortunately, in practice there are frequent liability claims against directors of German companies for payments made after the company has become insolvent. Due to a new court decision of the Higher Regional Court of Duesseldorf (Az.: 4 U 93\/16), it is uncertain whether D&O insurance coverage is available for this sort of claim.<\/p>\n
In our practice, this situation may frequently arise regarding German subsidiaries of foreign gruop of companies which are headed by non-German directors who are not fully aware of the German legal rules. Especially in a group context where subsidiaries may be funded by the mother company, an insolvency receiver may ask\u00a0 for compensation by a director personally, in case payments were made for liabilites after the mother compoany had stopped its funding.<\/p>\n
Since the liablity of the director of a German company carries a high personal risk, it is highly recommended to negotiate appropriate coverage when contracting a new D&O-insurance. Likewise, it should be negotiated with the insurance company regarding coverage in exisiting policies.<\/p>\n
In case of questions, please contact\u00a0Dr. Oliver Wulff\u00a0<\/a><\/p>\n +49 (89) 290719-18<\/p>\n