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Published online by Cambridge University Press: 21 May 2009
What duties of loyalty apply under Dutch law to a company's officer in respect of a business opportunity? In other words: should the officer refrain from ‘stealing’ an opportunity from the company, whereby stealing would consist of the transaction being entered into by the officer on his own behalf instead of on behalf of the company? This articles examines the answers to this question under Dutch law.
1. When using the words ‘American law’ reference is made to the company law of the individual states of the USA. In respect of the doctrine of corporate opportunities there are no substanial differences between the individual states which would make a reference to American law in this respect improper.
2. Hartung v. Architects Hartung/Odle/Burke, Inc., 301 North Eastern Reporter 2d 240(1973).
3. Meinhard v. Salmon, 164 North Eastern Reporter 545 (1928).
4. Maclary v. Pleasant Hills Inc., 109 Atlantic Reporter 2d 830 (Del. Ch. 1954).
5. President District Court Amsterdam 15 June and 1 August 1988, Kort Geding 1988, 276 and 341 (HCS).
6. The American Law Institute, Principles of Corporate Governance: Analysis and Recommendations (St. Paul, American Law Institute 1994).
7. C.AE. Uniken Venema, ‘Corporate opportunities: aspecten van loyaliteit in het kader van een onderneming naar Amerikaans en Nederlands recht’ [Corporate opportunities: aspects of loyalty in the framework of a company according to American and Dutch law] in B. Baardman, ed., Jurist in bedrijf [The jurist in a company] (Deventer, Kluwer 1980).
8. See for instance D.W.F.Verkade and J.H.Spoor, Auteursrecht [Copyright law] (Deventer, Kluwer 1985) p. 50.
9. Lagarde v. Anniston Lime & Stone Co., 28 Southern Reporter 199 (1900).
10. Guth v. Loft, 5 Atlantic Reporter 2d 503 (Del. 1939).
11. See n. 7.
12. See C. Asser, P. Scholten and G.J. Scholten, Handleiding tot de beoefening van het Nederlands burgerlijk recht, Algemeen Deel [Manual for Dutch civil law practice, General Part] (Zwolle, W.E.J. Tjeenk Willink 1974) pp. 62 et seq.
13. Art. 146/256 of Book 2 of the Dutch Civil Code (representation of the company in the case of a conflict of interest with one or more executive directors).
14. Art. 68 of Book 3 (in principle a procurator may only enter into a juridical act with his principal where the content of the act is so precisely determined that conflict between their interests is excluded), and Art. 416 (a mandatary can only act as co-contracting party of the mandator, if the content of the juridical act is so precisely determined that conflict of interests between them is excluded) and Art. 418 (obligation of a mandatary to disclose any direct of indirect personal interest in the coming into being of the juridical act) of Book 7 of the Dutch Civil Code respectively.
15. Art. 383 sub 2 of Book 2 of the Dutch Civil Code (obligation to state in the annual accounts the amount of loans, advances and guarantees to or for executive directors and Supervisory Board members of the company and its subsidiaries) and Art. 8 of the Dutch Social Economic Council Merger Code (obligation for the executive directors and members of the Supervisory Board of the companies involved in a public bid to disclose specified information on their private transactions in securities of the target company).
16. Art. 13 of Book 3 of the Dutch Civil Code (the holder of a right may not exercise it to the extent that it is abused).
17. See for instance W. von Steiger, Schweizerisches Privatrecht, Handelsrecht I (Basel 1976) p. 293 and Rosenne, S., Die Treuepflicht des Aktionärs (Zurich, Keller 1968) pp. 7 and 8.Google Scholar
18. This question was the subject matter in Goodman v. Perpetual Building Assoc., 320 Federal Reporter Suppl. 20 (D.C.Dist. Col. 1970), Dietrich v. Helm, 14 North Western Reporter 2d 913 (Minn. 1944), and Kerrigan v. Unity Savings Assoc., 317 North Eastern Reporter 2d 39 (1974).
19. See for instance V. Brudney and R.C. Clark, ‘A New Look at Corporate Opportunities’, 94 Harv. L Rev. (1991) p. 97 at pp. 1021 et seq.
20. A. Thalmann, Die Treuepflicht der Verwaltung der Aktiengesellschaft (Zurich, Juris 1975) p. 94.
21. See Arts. 344 et seq. of Book 2 of the Dutch Civil Code.
22. Court of Appeal Amsterdam [Ondernemingskamer] 26 May 1983, NJ 1984, 481 (Linders-Hofstee).
23. Court of Appeal Amsterdam [Ondernemingskamer] 8 October 8 1992, 71 de Naamloze Vennootschap (1993) p. 20 (Havermans).
24. See Arts. 400 et seq. of Book 7 of the Dutch Civil Code.
25. See Arts. 414 et seq. of Book 7 of the Dutch Civil Code.
26. Supreme Court 28 January 1977, NJ 1977, 301.
27. J. Weisser, Corporate opportunities: zum Schutz des Geschäftschancen des Unternehmens im deutschen und im US-amerikanischen Recht (Bonn, Heymann 1991) pp. 184 and 185.
28. The relative nature of this right is also highlighted in American law as is illustrated by Clark: ‘the opportunity need not be corporate property in the strong sense that the corporation could legally object to its being taken and developed by independent third parties. The point is only that, as between the corporation and its fiduciary, the opportunity belongs to the corporation.’ (R.C. Clark, Corporate Law (Boston, Little Brown 1986) p. 224).
29. ‘Under § 5.05 (a), a corporate opportunity should be promptly offered to the corporation, and the corporation should promptly accept or reject the opportunity. Failure to accept the opportunity within a reasonable time will be considered tantamount to a rejection’; op. cit. n. 28, at p. 287.
30. In Globe Woolen Co. v. Utica Gas & Electric Co., 121 North Eastern Reporter 378 (NY 1918), as paraphrased by Clark, op. cit. n. 28, at p. 172.
31. See n. 13.
32. See n. 22.
34. Amended proposal for a Council Directive complementing the Statute for a European company with regard to the involvement of employees in the European company. Presented by the Commission pursuant to Art. 149 (3) of the EEC Treaty, COM (91) 174–1; Amended proposal for a Council regulation on the Statute for a European company, COM (91) 174–2. See also Freedman, op. cit. n. 33, 16.418–16.420 and A. Wehlau, ’The Societas Europea: a Critique of the Commission's 1991 Amended Proposal, 28 CML Rev. (1992) p. 473.
35. The constructive trust is ‘a remedy which simply transfers to the corporation the opportunity which rightfully belongs to it plus whatever profit has in fact been realised’; as a consequence thereof one is not faced with ‘the calculation of damages (which) seem virtually impossible’. Comment, 74 Harv. L Rev. (1971) pp. 765, 768.
36. See Art. 88 II Aktiengesetz: ‘Verstösst ein Vorstandsmitglied gegen dieses Verbot, so kann die Gesellschaft Schadenersatz fordern. Sie kann statt dessen von dem Mitglied verlangen, dass es die für eigene Rechnung gemachten Geschäfte als für Rechnung der Gesellschaft eingegangen gelten lässt und die aus Geschäften für fremde Rechnung bezogene Vergütung herausgibt oder seinen Anspruch auf die Vergütung abtritt,’ Application of the Eintrittsrecht is defended by Weisser, op. cit. n. 27, at pp. 234 et seq. and by M. Schiessl, ‘Die Wahrnehmung von Geschäftschancen der GmbH durch ihren Geschäftsführer’, 79 GmbHRundschau (1988) p. 56.
37. See Weisser, op. cit. n. 27, at pp. 238 and 239.
38. Supreme Court 24 December 1993, NJ 1995, 421 (Waeijen-Scheers/Naus).
39. See para. 8.1.
40. As touched upon in para. 3.
41. Fletcher Cyclopedia of the Law of Private Corporations (Wilmette 1986) para. 862.1, p. 312. On p. 384 it reads: ‘…the corporate opportunity doctrine is a rule of disclosure…’.
42. In this respect reference is made to the HCS case as mentioned in para. 1.1.
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