FACTS AND POINT DECIDED:
Action to remove company auditor who exasperated management by an excess of zeal. An auditor is in a contractual relationship with the company audited, but his independence, necessary to enable him to alert the relevant authorities in certain circumstances as required by law, must be protected. Consequently, he can be removed only by the court on application by the company.
Held: The court will require serious grounds to so order. In this case, there was no evidence of bad faith by the auditor, and the Court of Versailles should not have ordered his removal merely because it found his conduct so excessively zealous that it exasperated management.
At the public hearing of 22 October 1991 THE COURT, based on the only argument pleaded, in its three parts:
Having considered article 227 of the law of 24 July 1966:
Whereas, according to the provisional judgement under appeal, Mr. Lemoigne, Chairman of the Board of Directors of Lemoigne, a public company, requested that Mr. Beaunier, auditor of that company, be relieved of his duties;
Whereas in order to accede to this request, the Court of appeal found that (1) Mr. Beaunier had acted with extremely meticulous attention to detail, which had exasperated the management of the company, and had attached a disproportionate importance to the failings he had noticed, which had led him wrongly to set in motion the procedure of alert, and without sufficient grounds to refer the matter to the State Prosecutor; (2) in connection with the planned transformation of the company into a SARL, he had wrongly refused to certify that the shareholders funds were equal to the companys capital as required by article 237 of the law of 24 July 1966; (3) he had thus made errors of judgement and failed to act; (4) his behaviour had made it impossible for the company to continue its contract with him;
Whereas by choosing to rely on such reasons, which, taking into account an accountants duty under the law, are inadequate to determine whether Mr. Beaunier had acted in bad faith and had thus committed a wrong justifying his dismissal, the Court of Appeals decision lacks a legal basis;
ON THESE GROUNDS:
QUASHES AND ANNULS, in all its provisions, the judgement handed down to the parties on 8 February 1990 by the Court of Appeal of Versailles; consequently returns the matter and the parties to the state in which they were prior to the aforementioned judgement, and so that justice may be done, refers them to the Court of Appeal of Paris.
Based on the report by Mrs. Loreau, Councillor, on comments by the SCP Boré et Xavier, advocate to Mr. Beaunier, by SCP Tiffreau et Thouin-Palat, advocate to Mr. Lemoigne and the company Lemoigne, and on conclusions by Mr. Curti, Advocate-General. M. BEZARD, President.
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