Precautionary revocation of the liquidator of an Italian limited liability company

With order of April 18, 2025, the Court of Venice, specialized section for business matters, ruled on the precautionary revocation (revoca cautelare) of the liquidator of an Italian limited liability company (società a responsabilità limitata S.r.l.), stating (i) that, even in case quotas are held in co-ownership, each individual co-owning quotaholder – without the need for intervention by the common representative – is entitled to act on his own to request the liquidator’s revocation and to exercise the information rights, and (ii) that the disposal of corporate assets falls within the typical activity of liquidation and constitutes just cause for revocation of the liquidator, pursuant to Article 2487, paragraph 4, of the Italian Civil Code, only when such disposal has taken place under disproportionate and unreasonable conditions.

The case

The dispute originates from a precautionary appeal (ricorso cautelare) pursuant to Article 700 of the Italian Code of Civil Procedure filed by two minority quotaholders of Alfa S.r.l. in liquidation, holders of a quota in the company under hereditary and ordinary co-ownership, who requested the Venice Court to revoke the liquidator of Alfa S.r.l. and to order a precautionary attachment (sequestro conservativo) of his assets up to the amount of the damage allegedly suffered by the applicants. According to the latter, the liquidator had conducted the liquidation in breach of the duties of fairness and good faith, having, in particular, sold to Beta S.r.l. the company’s principal asset, namely the shares of Gamma S.p.A., at an inadequate price, without the applicants’ knowledge.

The liquidator raised a preliminary objection (eccezione preliminare) stating that the individual quotaholders lacked standing to sue, since the quotas were held in co-ownership, so that the action could only be brought by the common representative (rappresentante comune) pursuant to Article 2468, paragraph 5, of the Italian Civil Code. On the merits, the liquidator then challenged the allegation, arguing, in particular, that the sale of the Gamma S.p.A. shares fell among the typical acts of liquidation and that, under Article 2489 of the Italian Civil Code, he had broad discretion in determining the timing and conditions of the sale; moreover, there was an urgent need to sell the asset in order to avoid enforcement actions (azioni esecutive) against Alfa S.r.l., given the company’s severe debt exposure. Finally, he stated that the sale had been preceded by attempts to sell to third parties and by pre-emption offers to the quotaholders, but no one, including the applicants, had expressed any real interest.

The decision

The Court of Venice, specialized section for business matters, with reference to the preliminary objection (eccezione preliminare) of lack of standing, emphasised the evolution of the case law, according to which the role of the common representative serves to the joint exercise of non-divisible administrative and patrimonial rights, but does not exclude the quotaholders’ individual rights. The judge therefore ruled that each quotaholder, even if a co-owner of a quota, has independent standing to exercise the information right pursuant to Article 2476, paragraph 2, of the Italian Civil Code and to take action for the revocation of the liquidator pursuant to Article 2487, paragraph 4, of the Italian Civil Code, as these rights and powers are inherent in the quotaholder status and not subject to the unified management of the quota by the common representative. In light of these principles, the objection raised by the liquidator was rejected.

On the merits, the Court referred to the provisions of the Italian Civil Code governing the liquidation, noting that the liquidator’s broad discretion may be reviewed by the court only in cases of conduct seriously contrary to the company’s interest or in breach of mandatory rules. The sale of corporate assets is typical of the liquidation stage and may be indicative of mismanagement (mala gestio) and can constitute a “just cause” for revocation only if it is carried out on manifestly unfair conditions. Applying these principles to the case at hand, the Court found that the challenged transaction had been conducted transparently, considering that the liquidator had given all quotaholders, including the applicants, the opportunity to express their interest in the purchase of the shares prior to the sale of them to Beta S.r.l.; moreover, the fact that the purchaser was related to the majority quotaholders did not affect the fairness of the procedure.

Finally, with regard to the alleged inconsistency of the purchase price, the judge observed that any assessment of the fair value of the shares requires a technical accounting assessment, that is incompatible with the summary nature of precautionary proceedings, while also noting in any case that the value of the shares had to be determined taking into account the specific context: the liquidation of the company had been ongoing for years, no one had expressed interest in purchasing the shares, the company’s debts were increasing, and enforcement actions were looming. In this framework, a price lower than market value could be justified by the need for immediate realisation.

Therefore, the Court declared the application inadmissible and rejected the request for precautionary seizure.