The Court of Cassation recognizes that shareholders have the right to seek compensation for harm suffered by the company, even when the company itself simultaneously initiates legal proceedings against its director (Cass. com., May 7, 2025, No. 23-24.052, No. 252 FS-B). The shareholders’ action (known as an ut singuli action) coexists with the company’s own action (ut universi), and is not conditional upon the company’s inaction.
In a recent case, both a limited liability company (SARL) and one of its shareholders brought simultaneous actions against the same director for the same harmful conduct. The court of appeal rejected the shareholder’s claim, holding that only the company’s legal representative could bring such an action.
The Court of Cassation overturned this decision: the shareholder’s claim is admissible, provided that they have a legitimate interest in the success of their case, in accordance with Article 31 of the Code of Civil Procedure and Article L. 223-22, paragraph 3 of the Commercial Code.
Legal basis:
- Article 31 CPC: legal action is available to any person who can demonstrate a legitimate interest, unless expressly restricted by law.
- Article L. 223-22 of the Commercial Code: shareholders of an SARL may individually or collectively bring a derivative action against the manager.
This combination of provisions supports the recognition of the ut singuli action. Such an action may be exercised prior to, concurrently with, or after the company’s action, based on distinct claims. This coexistence prevents a director from using the company’s (ut universi) action to shield another director from liability or to downplay the seriousness of their own misconduct (Cass. com., May 7, 2025, No. 23-15.931, No. 253 F-B).
Cabinet BRAHIN, Advokatfirma i NICE, Lawyers in NICE
Camilla Nissen MICHELIS
E-mail : camilla.nissen.michelis@brahin-avocats.com
1, Rue Louis Gassin – 06300 NICE (FRANCE)
Tel : +33 493 830 876 / Fax : +33 493 181 437
