A shareholder must notify the company of his address change

Publication / 16.12.2016

In a judgment dated April 22, 2016. The Supreme Court confirmed that the data contained in the limited liability company’s share book are of primary importance in determining the address of a shareholder. It is the board of directors that is obliged to keep such a book and enter in it, among other things, the name and surname or firm (name) of each shareholder and his/her address, while the shareholder is obliged to notify the board of directors of any change in his address (ref. II CSK 441/15).

The ruling was issued on the basis of a situation in which a shareholder did not attend a meeting of shareholders of a limited liability company, because the board of directors sent a notice to the wrong address, as disclosed in the share book. If a previous address, which is no longer valid, would have been entered in the share book, then the shareholder can indeed raise a claim of improper notice. However, in order to do so, he has to prove that the board of directors, when inviting him to the meeting, had knowledge that the shareholder already had a different address than that indicated in the share book.

Thus, the consequences of a shareholder’s failure to update his address for service can be very momentous and severe, and consist, for example, in the adoption of resolutions by the shareholders’ meeting that are unfavorable to him, while not being able to challenge them later.