Law Legal News [January 2024]: When the subjective notice period starts
Two-month subjective limitation period for giving notice of termination to an employee starts when an employer becomes aware of the reason for which notice of termination may be given to the employee; it was ruled by the Supreme Court in connection with the well-known case of a former employee. Two judgments in the current Legal News then also focus on corporate law – specifically on the diligence of a professional manager. Another judgment of the Supreme Court then deals with the interesting matter of the completeness of an offer to exercise the pre-emptive right in the absence of a willing purchaser’s designation, and the last judgment deals with unjust mutual enrichment with respect to the element of mutuality.
- The Supreme Court, in its judgment ref. no. 21 Cdo 1617/2023, has dealt once again with the employment matter of the employee who falsified their attendance record (of 16 minutes) and went to the post office during working hours to send a prison pyjama with a sticker number to an officer from municipal administration. This time, the Court dealt with the matter of when and through whom the employer learns of the reason why the employee may be given notice of termination of employment relationship for the breach of an obligation arising from the legislation related to work performed by the employee that is crucial for observing the subjective two-month limitation period for giving notice of termination. In view of the established decision-making practice in this matter, the Court confirmed that the employer becomes aware of the breach of an employment obligation, on the basis of which notice of termination is given, on the date on which its managerial employee, who is immediately superior or superior (therefore, they are entitled to impose work tasks and give binding instructions to the subordinate employee for that purpose) to the employee who has breached the employment obligation, becomes aware of the fact (learns) that the employee has committed such an act that may constitute the reason for notice of termination of the employment relationship.
- The latest case-law of the Supreme Court brings two new decisions in the area of corporate law in which it confirms its previous jurisprudential conclusions. Both judgments touch in some way on diligence of a professional manager, but each from a different perspective. The first judgment ref. no. 27 Cdo 287/2023 deals with the consequences of delegation of the powers of a member of an elected body to another person and the need to control it. The judgment ref. no. 27 Cdo 1264/2023 deals with the guarantee of a member of an elected body for the company’s obligations and the possibility of withdrawing from such a guarantee.
- In the judgment ref. no. 22 Cdo 2399/2023 the Supreme Court dealt with the matter whether an offer to exercise the pre-emptive right that lacks the willing purchaser’s designation becomes complete if the person having the pre-emptive right can learn about this person from a public register (in this matter from the Real Estate Register). Referring to the established case-law and literature, the Supreme Court stated that the purpose of the statutory regulation of Section 2148 (1) of the Civil Code is to ensure that, in the event of a proper procedure consisting in an offer made to the person having the pre-emptive right, the offer is responded to by the person having the pre-emptive right with the payment of the purchase price within a relatively short statutory period. If this does not happen, the pre-emptive right ceases to exist. It was also concluded that, if the original offer was not made to a beneficiary of the pre-emptive right in a proper manner (including, inter alia, the indication of the person of the willing purchaser), the time limit for the payment of the purchase price runs from the date on which the beneficiary otherwise became aware of the content of a purchase agreement with a third party, unless the person having the pre-emptive right is satisfied with the incomplete offer. In the adjudicated matter, the offer of the pre-emptive right did not identify the defendants as the willing purchasers. Nor did it appear from the circumstances of the matter that the claimant, as the person having the pre-emptive right, would have been satisfied with such an offer. However, the lower courts concluded that the initially incomplete offer became complete at the latest by the registration of the ownership right to the purchased co-ownership share of the willing purchasers in the Real Estate Register. According to the court’s arguments, the claimant could have ascertained the persons of the willing purchasers from the Real Estate Register. The time of the registration was linked to the statutory period for the payment of the purchase price by the person having the pre-emptive right. However, the appeal court disagrees with this conclusion, arguing that it is insufficiently justified and unreviewable. It also makes an additional statement that, if the argument is to be based on the first sentence of Section 980(1) of the Civil Code, according to which “if a right in rem is registered in a public register, ignorance of the information is no excuse”, the appeal court does not agree with that conclusion either. The consequences of the general accessibility of the data registered in the public register is that every person has an objective opportunity to learn them (or to verify the currently registered status). If they fail to do so or if they ignore the data registered, then, in particular, they are not entitled to presumption of good faith. However, that was not the case in the relevant matter. The claimant did not act actively in relation to the thing registered in the public register, but expected the performance of a legal obligation by the person obliged from the pre-emptive right. There is no doubt that the regulation of the first sentence of Section 980(1) of the Civil Code is not intended to replace the breach of the legal obligations pursuant to the Civil Code in a manner that would transfer the consequences of the breach to the party that did not commit any breach.
- The matter of the applicability of the regime of Section 2993 of the Civil Code to the settlement of claims from unjust enrichment that the parties to the proceedings have against each other, with regard to the element of mutuality, was dealt with by the Supreme Court in its judgment ref. no. 29 Cdo 3609/2022. In the cases where both contractual parties continue to provide each other with mutual performance agreed in the agreement after the termination of the agreement, it is also relevant for the attribution of the performance to the obligation from the recipient’s objectified point of view that each of the parties to the terminated agreement was both the provider of the performance and its recipient. The Supreme Court has stated that if both contractual parties continue to provide each other with the contractually agreed mutual performance after the termination of the agreement, and at least one of them receives such performance (considered from its objectified perspective) as the performance under the agreement, the regulation contained in Section 2993 of the Civil Code will be applied irrespective of the fact that the other contractual party accepted the mutual performance even though it knew that it could no longer be the performance under the agreement (that the agreement had already terminated) and that the objection of mutuality of the performance is subsequently raised by the other contractual party. The Court made the additional statement that, where the parties are to return to each other the pecuniary performance or pecuniary compensation within the meaning of Section 2999 of the Civil Code, the Court will only award the claimant (after the defendant has asserted the mutuality of the performance pursuant to Section 2993 of the Civil Code) the title to the return of an amount by which the pecuniary performance provided by the claimant to the defendant (the pecuniary compensation) exceeds the pecuniary performance (the pecuniary compensation) provided by the defendant to the claimant. Such an action by the court (the mutual settlement) does not require (anticipate) an act by the defendant to the “set-off” of a mutual receivable. Since such a mutual settlement is not the set-off, it is not precluded (according to the established case-law) by the regulation limiting the set-off of certain receivables during insolvency proceedings.
