The legal personality of a business shall continue to exist until the end of its judicial winding-up

A business seeks the annulment of an agreement to transfer shares in a company which it has concluded with its counterparty. In the meantime, the business had learned that the company in question had been put into receivership and then wound up.

The Court of Appeal upheld the business' application. It annulled the share transfer agreement and therefore ordered the return of the company's shares to the counterparty since the cancelation of a contract is retroactive. The co-contractor appealed to the Court of Cassation and requested that the business pay him EUR 150 000 because, according to him, it is impossible to restore the companies to their original condition in view of the liquidation currently taking place in the core of the assignment.

The Court of Cassation dismisses that appeal.

It considers that it is possible to restore the parties to their original condition because the legal personality of the company in liquidation is maintained in this case. The Court holds that a judgment winding up a business by operation of law, if it entails its dissolution, has no effect on its legal personality which will remain, for the purposes of winding up, until the publication of the closure of the proceedings. Consequently, the shares in question still have legal existence as long as such publication has not taken place. It is therefore possible here to proceed with a restitution in kind.