Good faith in the calling of general meetings of shareholders: Supreme Court judgment 282/2025
With the arrival of the usual period for holding meetings to approve the annual accounts, it is essential to recall the importance of issuing valid notices of meeting that respect the principles of good faith and the established practices within the company. Supreme Court judgment 282/2025, delivered on 20 February 2025, provides a key lesson in this regard.
Background to the case in Supreme Court judgment 282/2025
In a private limited company consisting of three shareholders (holding 40%, 40%, and 20% respectively), general meetings had historically been held on a universal basis – that is, without the need for formal notice – since all shareholders would attend and adopt resolutions unanimously.
However, in a context of shareholder conflict, the board of directors opted to call a general meeting using the formal procedure stipulated in the articles of association: publication in the Official Gazette of the Companies Register (BORME) and in a provincial newspaper. This change in the manner of convening the meeting was not personally communicated to the shareholders, which meant that one of them was unaware of the meeting.
At that meeting, the annual accounts were approved, along with a capital increase which significantly diluted the absent shareholder’s holding, reducing it from 40% to 13.79%.
The Supreme Court’s decision in judgment 282/2025: nullity of the resolutions
The affected shareholder challenged the resolutions adopted at the meeting, alleging abuse of rights and bad faith. He argued that the sudden use of the formal procedure for convening the meeting, without personal notice, was a deliberate tactic to prevent his attendance and participation in decision-making, and to deprive him of the opportunity to exercise his pre-emptive subscription rights in the capital increase, resulting in the dilution of his shareholding.
The Supreme Court upheld the nullity of the meeting and all resolutions passed, based on the following grounds:
Breach of established practice contrary to good faith: The sudden change in the method of calling the meeting without prior personal notice broke with the long-standing good faith practice in place since the company’s incorporation.
Abuse of rights: The use of the formal notice procedure, never previously employed, with the intention of preventing a shareholder from becoming aware of the meeting and thereby diluting his interest, was deemed an act of bad faith and abuse of rights (Articles 7.1 and 7.2 of the Civil Code).
Unlawful harm: Preventing a shareholder from attending and voting justifies the annulment of resolutions, even if their presence would not have altered the outcome, particularly where it results in the shareholder being unable to subscribe to the capital increase and consequently suffering dilution of their shareholding.
Trust and good faith: Prior disputes among shareholders do not justify such conduct, as the legitimate expectation that a particular method of calling meetings would continue to be used remained protected by the principle of good faith.
Conclusions from Supreme Court judgment 282/2025
This judgment highlights that:
Form matters: Even if the articles of association permit certain methods of notice, abruptly changing long-standing practice without prior warning may constitute an act of bad faith.
Good faith is essential: Compliance with the law and the articles of association does not absolve directors from the duty to act in good faith and respect shareholders’ legitimate expectations.
Professional legal advice is crucial: In the context of shareholder disputes, obtaining specialist legal advice can help avoid actions that, though apparently lawful, may lead to the nullity of resolutions and costly litigation.
In summary, Supreme Court judgment 282/2025 underlines the importance of respecting not only legal and statutory provisions but also established practices and the principle of good faith in corporate governance. An unexpected change in the method of calling meetings, particularly in closely held companies with long-standing practices, can have serious legal consequences.
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