Facts
A. (defendant, appellant) leases several parcels to B. AG (plaintiff, respondent). The parties dispute whether [A.] has terminated the lease agreement.
On December 27, 2012, [B. AG] filed a conciliation request with the N. Peace Court. At the conciliation hearing on April 26, 2013, [D.], the mother of E., the sole member of the Board of Directors of [B. AG], appeared. The conciliation authority granted [B. AG] the authorization to file a lawsuit.
[A.] contested the validity of the authorization to file a lawsuit, as [D.] could not effectively represent B. AG. The lower instances considered the authorization to file a lawsuit as valid, as [D.] was to be qualified as a de facto organ of B. AG.
Considerations
The Federal Supreme Court sets aside the decision of the lower instance and remands the case for supplementation of the facts and a new decision.
The Federal Supreme Court states that a legal entity cannot be represented by de facto organs in the conciliation proceedings. The conciliation authority must be able to quickly and easily verify whether the legal entity is properly represented. For this, the representatives must either be registered organs in the commercial…