Responsibility of the Director for improper accountancy of the Company

The Court has ruled that improper accountancy is equated to large carelessness, i.e. such acting does not correspond nor to careful, neither to circumspect behavior standards of the Director.

The Court has noted that it is necessary to identify the nature of the duties breached by the Director of the Company in order to decide upon the sort of the responsibility to be applied to him:
·     provided that the Director causes damages to Company by breaching the duties of employee of the Company appointed to him, the material responsibility is being applied to the Director according to the Labour Law. This responsibility is limited by the amounts and order established by the regulation of Labour Law;
·     provided the Director acts dishonestly, improperly manages the accountancy etc. or breaches the duties of the Director established by the specific laws, the civil liability is being applied to him.

The Court has ascertained in this case that civil liability is being applied to the Director for improper accountancy, therefore the Director shall recover losses suffered by the Company due to such acts.

11.05.17