Aline Pardi Ribeiro
Lawyer at Marcos Martins Advogados
The creation of a company presupposes the intention to join forces to set up a legal entity that will assume responsibilities, obligations, duties and rights in civil life, replacing those who previously acted individually. The decision to set up a legal entity with the corporate type defined by the limited liability company, whose main characteristic is the limitation of the liability of the partners in relation to the obligations contracted by the company they have set up, is normally guided by the security and protection of the personal assets of its partners.
However, article 1.052 of the Civil Code states that in limited liability companies, the liability of the partners is restricted to the value of their shares, although all the partners are jointly and severally liable for the payment of the share capital[1]. The main duty of the partners is the duty to pay in the subscribed capital and, if they fail to do so, they will all be jointly and severally liable for the capital not paid in, and will be vulnerable to executions that may be filed against the company of which they are a part.
In any case, if the company’s capital is fully paid up, the partners are not liable to third parties for the obligations contracted by the company. In the words of Itamar Gaino:
Once the capital has been paid in, the partners are not liable to third parties for the company’s debts. In view of this distinction between the legal entity of the company and the natural persons of the partners, third parties in this case can only demand their credits, whether commercial or otherwise, from the company, exclusively by executing the assets that make up its patrimony, and they are not allowed to advance on the partners’ private assets, except in exceptional situations that will be dealt with below[2].
Some of the exceptions to the rule of irresponsibility of partners in companies with paid-up capital are the provisions of tax legislation. According to the National Tax Code (“CTN”), the person liable for payment of a tax or pecuniary penalty is the person directly related to the taxable event or defined as liable by express provision of law[3].
In this sense, Section III of the CTN deals with liability for the fulfillment of tax obligations by third parties. Article 134 of the CTN lists the third parties responsible in the event that the taxpayer is unable to demand compliance with the main obligation, making them jointly and severally liable for the acts in which they intervene or for the omissions for which they are responsible. With regard to companies, item VII of article 134 of the CTN states that the partners will be liable for the tax obligation in the event of the liquidation of a partnership and item III of article 135 of the CTN states that the directors, managers or representatives of legal entities governed by private law will be personally liable for the credits corresponding to the tax obligations resulting from acts carried out in excess of their powers or in breach of the law, articles of association or bylaws.
In relation to limited liability companies, item VII of article 134 of the CTN is not applicable, since they are not commonly constituted as partnerships, and the specific case must be analyzed.
Article 135(III) of the CTN provides for the liability of company administrators and representatives for tax obligations in certain situations, so partners will be held liable under this legal provision if they also act as administrators of the company of which they are partners. Furthermore, according to article 135 of the CTN, the managing partner must act willfully in order to be held liable, given that they will only be liable for acts carried out in excess of their powers or in breach of the law or articles of association, making them subjectively liable. The subjective liability of the managing partner is an understanding enshrined by the Superior Court of Justice, according to some of the judgments transcribed below:
Interlocutory Appeal. Tax enforcement. Inclusion of the partner in the suit. Article 135, III, of the CTN. Inadmissibility Mere default does not, in itself, make the managing partner liable. Requirement to demonstrate willful misconduct or fraud in the acts carried out by the legal representatives resulting in default of the tax obligation. Understanding established by the STJ. Decision upheld. Appeal dismissed[4].
INTERLOCUTORY APPEAL. Return of the case file by the Honorable Presiding Judge of the Public Law Section of this Court of Justice, under the terms of article 543-C, paragraph 7, of the Code of Civil Procedure, for adjustment or maintenance of the decision, due to the judgment of Appeal No. 1.101. 728/SP, on 23/03/2009, which recognized that, in the case of taxes levied by homologation, the taxpayer’s declaration eliminates the need for the tax authorities to formally establish the debt, as well as that the mere failure to pay the tax does not, in itself or in theory, constitute a circumstance that entails the subsidiary liability of the partner, as provided for in article 135 of the National Tax Code. Return of the case file to the Trial Chamber in compliance with the provisions of article 543-C, paragraph 7, of the CPC. Ruling upheld[5].
Therefore, the liability of partners under tax law will derive from (i) the acts performed by them, when they are also directors of the company, always in excess of their powers or in breach of the legal provisions or articles of association; and (ii) in the case of partnerships, the partner will be liable for default of the company’s obligation to pay when there is omission and intervention by that partner in relation to the respective obligation; otherwise, the liability for payment of the debts is exclusive to the company, which has its share capital fully paid up.
Furthermore, it is worth noting that it is up to the tax authorities to prove that the partner of the legal entity has committed unlawful acts under the terms of article 135 of the CTN, and this proof can be made in the context of administrative proceedings or tax enforcement. In the context of tax foreclosures, if the name of the partners appears as jointly liable on the active debt certificate, since this has a presumption of certainty and legitimacy, the burden of proof is reversed, since it is presumed that personal liability has already been characterized in the administrative process. In these cases, it will be up to the partners to prove that they did not commit the illegal acts imputed to them.
[1] BRASIL. Article 1.052 of Law no. 10.406, of January 10, 2002. Available at <http://www.planalto.gov.br/ccivil_03/leis/2002/l10406.htm>. Accessed on March 10, 2014.
[2] GAINO, Itamar. Responsabilidade dos Sócios na Sociedade Limitada. 3. ed. São Paulo: Saraiva, 2012. p. 38.
[3] BRASIL. Article 121 of Law No. 5.172, of October 25, 1996. Available at: <http://www.planalto.gov.br/ccivil_03/leis/l5172.htm>. Accessed on March 10, 2014.
[4] Interlocutory Appeal No. 2068779-22.2013.8.26.0000 – District of Campinas, State of São Paulo. Reporting Judge Dr. Luiz Burza Neto. Vote nº 33.272, judged on February 26, 2014.
[5] Interlocutory Appeal No. 2019637-15.2014.8.26.000 – District of Votorantim, State of São Paulo. Judgment handed down by the 4th Public Law Chamber of the São Paulo Court of Justice. Reporting Judge Dr. Paulo Barcellos Gatti. Vote no. 2.635, judged on February 24, 2014.
