Peculiarities of the protection of a bankrupt manager when he is held jointly and severally liable

The Bankruptcy Code of Ukraine has attracted significant attention, particularly regarding the issue of joint and several liability of the debtor company’s manager and the debtor itself. Since the implementation of the Bankruptcy Code of Ukraine, sufficient time has elapsed for legal practitioners to develop certain perspectives, approaches, and algorithms for addressing the issue of imposing joint and several liabilities on the debtor’s manager. The creditor’s path from the initiation of bankruptcy proceedings to the moment of receiving funds from the debtor’s manager’s assets depends on numerous factors. These factors include, inter alia, the corporate governance structure of the company and the regulations governing the market in which the debtor operates. These and other factors become the primary subject of investigation when defending the debtor’s manager in cases of imposing joint and several liability. This is explained by the fact that the level of the manager’s responsibility, their ability to make crucial decisions, and manage risks are all determined at the stage of company formation and management selection. Moreover, the law may prescribe certain procedures by which the debtor’s manager is obligated to monitor the financial condition of the debtor company. The existence of such procedures must be taken into account when formulating a defense strategy for the debtor’s manager. This article focuses on how a debtor company’s managers should defend themselves when attempts are made to hold them liable for the company’s debts. Therefore, the terms «debtor» and «joint and several liability» are used in the context of the Bankruptcy Code of Ukraine. The article analyzes the elements of a civil offense that results in the imposition of joint and several liability on the debtor’s manager. It also highlights some issues in qualifying the actions of the debtor’s manager when imposing joint and several liabilities during bankruptcy proceedings. In civil offenses, the presumption of the fault of the tortfeasor applies, which has also been examined from the perspective of defending the debtor’s manager when imposing joint and several liabilities during bankruptcy proceedings. The article includes opinions of practicing judges who have taken a deep interest in the subject matter, highlighting issues in the application of current provisions of the Bankruptcy Code of Ukraine regarding the imposition of joint and several liabilities on the debtor’s manager.