Director liability lawyer Paris: measuring personal exposure.

A simple fault, taken in isolation, does not make the director personally liable towards third parties: only the company answers for it. Mismanagement (Articles L. 223-22 and L. 225-251 of the French Commercial Code) engages the director's liability towards the company and the shareholders and is the basis of the company's action. A separable fault, which is more demanding, is one committed intentionally with a particular gravity incompatible with the normal exercise of corporate functions: it alone opens the way to a claim by a third party (Cass. com., 20 May 2003, No. 99-17.092).

There are three categories of claimant: the company itself (company action brought by a new director or by the liquidator), shareholders (derivative action (ut singuli) for the benefit of the company, or individual action in case of distinct personal harm), and third parties (creditors, counterparties), who must in addition demonstrate a fault separable from the functions. The firm checks standing to sue before any proceedings are started.

Three years from the harmful event or, if it was concealed, from its discovery, under Articles L. 223-23 (SARL) and L. 225-254 (SA, SAS) of the French Commercial Code (Code de commerce). Ten years where the act is classified as a serious crime. The action for shortfall in assets (Article L. 651-2) is also subject to a three-year limitation period running from the liquidation judgment. Any strategy begins with a rigorous check of the dates.

Yes, in the vast majority of situations. This insurance covers defence costs (lawyer, expert assessment, proceedings) and compensates civil awards, within the limits of the policy. It does not erase the fault, but it helps prevent a reasonable director from being ruined by a claim. The firm systematically examines the general conditions and the exclusions before committing to a strategy.

Partially, and subject to strict conditions. The delegation must be in writing, precise as to its subject matter, and given to a person who has the necessary authority, competence and resources. It does not relieve the director in case of personal fault or where the breach concerns obligations the director has reserved. A purely formal delegation erases neither civil liability nor criminal liability.

The derivative action (ut singuli), provided for by Article 1843-5 of the French Civil Code (Code civil) and taken up by L. 223-22 paragraph 3 (SARL) and L. 225-252 (SA, SAS), allows one or more shareholders to bring the company's action in the company's name. The damages go to the company, not to the claimant shareholder. No capital threshold is imposed for a shareholder's individual action for compensation of personal harm; a 5% threshold applies for the collective company action in SAs (Article R. 225-169).

Where the company is in judicial reorganisation or liquidation, the company's liability action against the director is brought by the court-appointed representative or liquidator. Shareholders in principle lose standing to sue, unless they show distinct personal harm. The liquidator may also bring the action for shortfall in assets, which is a route independent of the ordinary-law liability action.

Provided for by Article L. 651-2 of the Commercial Code, it allows the court, in a judicial liquidation revealing a shortfall in assets, to place all or part of that shortfall on the de jure or de facto directors, provided that a management fault that contributed to the shortfall is established. The Sapin II law of 9 December 2016 expressly excluded simple negligence. The court has sole discretion over the amount (Cass. com., 9 May 2018, No. 16-26.684).

Yes. Case law and statute (Article L. 651-2 in fine of the Commercial Code in particular) treat the de facto director like the de jure director for the purposes of liability actions. A de facto director is a person who, in complete independence and on a continuous basis, performs positive management functions that are added to, or replace, those of the de jure director. Proof rests on a body of evidence.

Yes. Where a legal entity is appointed chairman or director of an SAS, its own directors are subject to the same conditions and obligations and incur the same civil and criminal liability as if they were chairman in their own name, without prejudice to the joint and several liability of the legal entity they manage (Article L. 227-7 of the Commercial Code). Using a legal entity offers no additional protection.

Yes for acts after the resignation, provided that it is dated, notified and enforceable against third parties (publication in the Trade and Companies Register). The Court of Cassation recently quashed an adverse judgment for acts after the resignation (Cass. com., 26 November 2025, No. 24-21.022). However, resignation does not cover faults committed while in office.

Yes, in principle, within the limits of the estate and the rules of civil liability, unless the inheritance is renounced or accepted up to the net assets. The compensation debt passes to the heirs like any debt of the deceased. The firm advises assessing quickly whether to exercise an option over the inheritance, within the four-month period provided for by Article 771 of the Civil Code.

Often, yes. A settlement agreement (Article 2044 of the Civil Code) allows a dispute to be ended through reciprocal concessions. It is common where the exposure is established, where the cost of litigation is high, or where publicity presents a risk. The firm drafts the settlement agreement to secure the concessions and guarantee its res judicata effect.

The commercial court (tribunal de commerce) of the company's registered office, under Article L. 721-3 of the Commercial Code. For a company registered in Paris, this is the Paris commercial court. The articles of association may provide for an arbitration clause referring disputes to arbitration. The Paris court of appeal has jurisdiction over appeals.

The cost varies with the complexity of the case, the amount of the opposing claims and the likely length of the proceedings. An initial exposure audit generally costs between €1,200 and €2,500 incl. VAT. Defence on the merits before the commercial court starts from €4,500 incl. VAT, with expert fees and pleading fees in addition. Directors' liability insurance may cover all or part of these fees.