Return of payments on account of future capital increases

The Supreme Court, with order No. 24093 of August 8, 2023, ruled upon the subject of contributions for future capital increase, reaffirming that the same are "contributions of money by shareholders in favor of the company that are not, however, definitively acquired to the company's assets, as they are dedicated exclusively to a specific activity, with the consequence that, if the capital increase is not operated, the shareholder will have the right to the restitution of the amount contributed due to the disappearance of the justifying cause for which he has made the contribution."

It also enunciated the relevance of interpreting the will of the parties in order to determine whether a payment is made as a capital contribution or as a future capital increase.

The case

The case originates from a recourse filed before the Court of Benevento by the excluded shareholder of a limited liability company, to obtain the appointment of an expert for the judicial determination of the value of his participation. The sum thus determined subsequently became object of an injunction decree. 

The limited liability company proposed appeal against the aforementioned decision, challenging the manifest inaccuracy of the determination of the company's assets and, consequently, of the value of the participation of the excluded quotaholder, as previously estimated. 

The Court found that the evaluation of the company’s assets was incorrect and made a new estimation, revoking the injuction decree and ordering the limited liability company to pay a lower amount. 

The excluded quotaholder appealed the aforementioned pronunciation before the Court of Appeal of Naples, which rejected appeal. The Court of Appeal agreed with the first instance judge’s evaluation, according to which, the sum indicated in the financial statements as “contribution for future capital increase” actually constituted a debt of the company to the quotaholder or a contribution conditioned on a future capital increase resolution.

Finally, the excluded quotaholder filed a recourse to the Supreme Court against the decision of the Court of Appeal of Naples. 

The decision

The Supreme Court reaffirmed the distinction between “shareholders/quotaholders’ loans”, “non-refundable contributions”, “capital contributions” and “contribution for future capital increase”, also referring to the previous order No. 29325/2020.

In particular, the non-refundable contributions differ from the shareholders/quotaholders’ loans, as they are not subject to the right of repayment. Therefore, they should be recorded in the financial statements as reserves that can be used to cover losses or increase proportionally capital free of charge.

Contributions for future capital increase are designated to release the debt from subscription of a future capital increase, since they are related to the shareholders who made the contributions, in proportion to the amount of the sums paid by each. If the capital increase is not carried out, the shareholder will have the right to the restitution of the amount contributed (as a recovery of undue payment) due to the disappearance of the justifying cause for which he has made the contribution.

Finally, the Supreme Court pointed out the decisive importance of the interpretation of the parties’ will in qualifying the contribution. In particular, the will of the parties to submit the payment to the capital increase must be clear and unequivocal and the judge’s assessment on the point can be made by taking into account every element: by way of example, the indication of the deadline by which the increase will be resolved, he behavior of the parties, the presence of clauses in the bylaws or annotations in the accounting records or in the notes to the financial statements, while the mere denomination used in the accounting records is not sufficient.