The German Federal Court of Justice (BGH) has ruled that a limited partner is not liable for debts incumbent on the insolvency estate incurred by an administrator in insolvency proceedings.

However, it was unclear who would be liable for debts incumbent on the insolvency estate pursuant to section 55(4) of the German Insolvency Act (the Act) incurred in preliminary insolvency proceedings. A recent BGH ruling on 28 January 2021 (IX ZR 54/20) now provides clarity.

Case summary