On the dissolution of the limited liability company. Disagreement of the shareholders

• Author: Cristina Cojocaru
• Position: Department of Law, Bucharest University of Economic Studies, Romania, cristina.cojocaru@cig.ase.ro.
• Pages: 104-110

On the dissolution of the limited liability company.

Disagreement of the shareholders

Lecturer Cristina COJOCARU1

Abstract

The limited liability co mpany, similar to the general par tnership is set up and

functions on the grounds of the trust b etween shar eholders. Therefore, this type of company

has an intuitu personae character , just like any company of persons. The limited liability

company opera tes as long as the conditions laid down by la w ar e met, and if a ny or more

causes leading to the improper opera tion of the company, it shall dissolve. One of the

dissolution cases is that stipulated by articles 227 pa ragraph (1) letter e) of Law no. 31/1990

– the dissolution by court decision respectively – when the dissolution cannot be decided

following a decision of the genera l meeting – on solid grounds, which can be

misunderstandings between the shareholder s. Such misunderstandings are not by themselves

enough to lead to dissolution, but it is necessary for them to determine the improper operation

or lack of any company’s operation.

Keywords: limited liability company, the Romania n Law, dissolution, affectio societatis.

JEL Classification: K22

1. Introduction

A relatively recent case2 in our Supreme Court gives us the opportunity to

analyse some legal provisions on the dissolution of commercial companies in general

and especially of limited liability companies, a type of company that is very common

in our law. In the present case, some of the shareholders have requested the court to

order the dissolution of the company because there were severe, irreconcilable

disagreements between the shareholders, based on the provisions of art. 227 par. (1)

letter e) of Law no. 31/1990 (hereinafter, "the Law" or "Law no. 31/1990").

The cessation of the existence of the company results in the termination of

its legal personality and the liquidation of its patrimony. This activity requires – as a

general rule – two distinct and successive phases: the dissolution phase of the

company followed by the liquidation phase, when its patrimony is liquidated.

Dissolution is therefore the first stage of the process of cessation of a company's

existence3 creating the premises for its liquidation.

According to the legal provisions, the decision to dissolve the company is

made by the General Meeting or by the court, and only exceptionally, it is carried

out exclusively based on the provisions of the law. It is worth mentioning that the

1 Cristina Cojocaru – Department of Law, Bucharest University of Economic Studies, Romania,

cristina.cojocaru@cig.ase.ro.

2 See Decision no. 679/27 February 2015 of ICCJ, Second Civil Division.

3 Stanciu D. Carpenaru, Trata t de drept comercial roman, conform noului Cod civil, Universul Juridic

Publishing House, Bucharest, 2012, p. 263 et seq.