It is common to identify, during the daily practice of the profession, incorporated into any number of contracts, the stipulation that the contractual relationship terminates automatically in the event that one of the parties initiates some type of recovery mechanism due to its difficult financial situation.
In this regard, Law 1116 of 2006, in its Article 16, expressly regulates the ineffectiveness of any stipulation or clause contained in a legal act that “has the purpose or aim of preventing or hindering, directly or indirectly, the initiation of a reorganization proceeding.” Based on the aforementioned provision, several clarifications can be made to understand its scope.
First, the contractual stipulation must have been made prior to the initiation of the reorganization proceeding, with the purpose or aim indicated above, whether it is agreed “the early termination of contracts, the acceleration of obligations, the imposition of restrictions, and in general, through any kind of prohibitions, requests for authorizations, or imposition of unfavorable effects for the debtor.” The article does not intend to exhaust all possible scenarios that may have the effect of inhibiting the debtor from initiating a reorganization proceeding, but only to mention some of the most common ones in legal transactions.
The provision establishes the sanction of ineffectiveness for this type of clause, implying that it does not require a judicial declaration for them to have no effect, but rather, by operation of law and from the execution of the act in question, it sanctions the stipulation and denies its initial effects, that is, it does not bind the parties and is not enforceable against third parties.
However, the provision also establishes that, once the reorganization proceeding has begun, in those cases where there is a dispute between the debtor and the counterparty with whom the corresponding legal transaction was entered into or a specific operation was carried out, this must be heard and resolved by the Judge conducting the corresponding reorganization, allowing for the possibility that in these cases there is indeed a judicial decision to declare the grounds that lead to ineffectiveness proven, especially taking into account the guarantee of due process available to the counterparty of the transaction or act analyzed.
Additionally, the provision states that the party that has attempted to enforce the clause under study must also bear the postponement of its credit in the respective agreement resulting from the reorganization proceeding, relegating payment of this only after the other credits of the reorganization proceeding have been satisfied. The sanction reveals the legislator's intention to censure, rather than the incorporation of the stipulation under study in the contract, the will of the counterparty to enforce it.
Article 16 cited subsequently determines the cancellation of guarantees granted by the debtor or by third parties to secure credits derived from the legal act in which the ineffective stipulation was incorporated. This sanction, in addition to requiring the intention to enforce the contractual provision, must be preceded by a proportionality analysis by the bankruptcy judge that such decision is vital for the development of the proceeding. This sanction should be analyzed on a case-by-case basis, carefully and conservatively, seeking not to violate, without solid justification, the rights of the creditor.
The article also incorporated the imposition of treating, under equal conditions, those debtors who, once admitted to a reorganization proceeding, enter into selection processes for public tenders, a scenario that can be extended to any of the forms that the State has to select an offer, in the case of state contracting. The obligation aims to protect the right of any natural or legal person who, having the status of merchant, seeks recovery tools, such as the reorganization proceeding.
The aforementioned issue was analyzed by the Constitutional Court in the context of the unconstitutionality lawsuit filed against the cited article, in which the plaintiff argued that the provision violated Articles 1, 2, and 366 of the Constitution, since, according to the plaintiff, it gave prevalence to the particular interest of the entrepreneur over the general interest of society in the performance of a state contract. In this regard, the high court argued that:
First, the protection granted to the company in Article 16 of Law 1116 of 2006 is not based on its simple status as a legal entity, but on the safeguarding of the function it fulfills in society as the basis of development, source of employment, and support of the economy; therefore, it contributes to the well-being of the entire society, and its dissolution affects its workers, commercial intermediaries who have contractual relations with it, consumers, and in general the entire economy, so this provision does not disregard but is based on the general interest.
In this way, it resolved the issue by clarifying the very nature of private property in Colombia, the social function of the company, the justification for the existence of recovery mechanisms, and the treatment that a company subject to a mechanism such as the one addressed should receive.
Andrés Ogonaga. – AZC CONSULTING ATTORNEY