Notification of communications in the matter of civil and commercial relations.

This article focuses on the topic of potential notices/correspondence between private entities that must communicate material statements to other private entities (whether contractually bound or not) and their probative value/effectiveness in potential and subsequent litigation. According to the prevailing jurisprudence, if there is a valid and effective contract and it provides for a method of communication freely chosen by the contracting parties, that method is the one that must be followed in the communication relationship between the two or more contracting parties. In any case, the entity is given the right (even in the presence of a contract that provides for a specific method of communication between the entities) to continue sending statements by other methods, for example, mail or authorized postal operators (couriers). In the case of delivery by registered letter, it is settled case law that it is always possible for the addressee to dispute the contents of the postal envelope even in the event of actual receipt of the same, since the return receipt certifies the receipt of a «letter» but never certifies what is the content of this letter.

A division is a form of transformation whereby one company (called the «converting») (whether an LLC or an JSC) is being divided into two or more companies (called the «acquiring companies»). The division consists in the fact that the transforming company is terminated without liquidation and a corresponding part of its assets, rights and obligations and activities pass to the acquiring companies. It is possible that some of the acquiring companies are newly created and others already established. In the case of conversion by division, the receiving companies cannot change their legal form (e.g. from LLC to JSC).
Procedure.
A. Conversion Agreement.
Before the conversion decision is made, a conversion contract is concluded between the receiving and/or converting companies participating in it. The conversion contract is concluded by the persons representing the company in writing with notarization of their signatures. The conversion agreement sets out how the conversion will take place and must contain at least the following elements:

The issue, the subject of this article, is legally regulated in Art. 125, para. 3 of the Commercial Law, which stipulates that when a partner in a limited liability company terminates his participation in the company, the property consequences are settled on the basis of an accounting balance at the end of the month in which the termination occurred. The specified provision determines the moment of drawing up the accounting balance, according to which his claim will be calculated. The judicial practice (Decision No. 224/2010 of the Supreme Court of Appeal) accepts that this legal provision is of an imperative nature and the partners cannot overcome neither with an agreement to the contrary nor with a stipulation in the partnership agreement. Such a stipulation would be void based on Art. 26, para. 1 of the ZZD. Jurisprudence, on the other hand, is not clear regarding the «dimensions/nature» of this imperative character and the question remains open whether it is only about the amount due and the way of its calculation /certainly imperative/ or about the way of payment of cases of the partner. Therefore, the question arises as to whether it is mandatory to satisfy the departed partner only by paying a sum of money or the property issues related to the relationship can be resolved using assets of a non-monetary nature as well, on the basis of mutual agreement between the parties (the partner as creditor and the company as debtor). It seems that the law is not clear enough on this point.

1. Procedure: The procedure for the purchase and sale of shares in an Ltd. /limited liability company/ is governed by Art. 129 of the Commercial Law, where it is stated: «1. The company share can be transferred and inherited. The transfer of shares in the company from one partner to another is carried out freely, and to third parties — subject to compliance with the requirements for accepting a new partner and if there are no unpaid wages, benefits and mandatory insurance contributions of workers and employees, including employees whose labor legal relations were terminated up to three years before the transfer of the company share. 2. The transfer of the company share is carried out with a contract drawn up with notarization of the signatures and content, after which it is entered in the commercial register.

This article aims to outline the order and nature of the conditions for suspending the registration/deletion procedure of the circumstances related to the companies’ activities.
1. The registration procedure (in general). The procedure for entering acts in the commercial register is regulated in Chapter Two, Art. 13 et seq. of the Commercial Register and Non-Profit Legal Entities Act (ZTRRYULNC), which is a type of protective proceeding similar to that under Art. 530 of the Civil Procedure Code (CPC).
The main participant in this proceeding is the entity requesting registration and the procedure is aimed at protecting interests, with a view to achieving the effect of registration, deletion and announcement, i.e. the legal consequences that are beneficial to the applicant, but the registration itself cannot be intended to damage the legal sphere of third parties.

In Bulgarian law, in the event of arbitration decision which provides for a definition of relations between two or more parties with respect to a contract, there is a possibility of a formal review of the decision, which is expressed by an appeal to the Supreme Court of Cassation for annulment of the arbitration decision.

This possibility of cancellation is regulated in Art. 47 of the International Commercial Arbitration Act. The term in which the request can be submitted is three months from the day on which the party received the arbitration decision. Arbitral tribunals usually send their decisions to the parties by post, courier or in person.
The deadline for submitting the request for revocation starts from the date of receipt of the arbitration decision.

The management and control contract is regulated by the Commercial Law, which requires the relationship between the capital company and the manager to be regulated by a management assignment contract. The contract is concluded in writing on behalf of the company through a person authorized by a general meeting of partners or by the sole owner of the capital (art. 141, para. 7 — for limited liability companies and art. 244, para. 7, for joint-stock company).
The management contract is not an employment contract, but a civil contract, the main purpose of which is to regulate the relations between the company, on the one hand, and its manager (or a member of the Board of Directors for joint-stock companies), on the other.

Each manager of a limited liability company (OOD) is liable with his assets for damage caused to the company (Article 145 of the Commercial Law). The factual composition of this type of civil liability concerns the culpable, unlawful non-fulfillment of the duties of the managedr, whose behavior hinders the management of the company and from which damage has been caused. The right of the company to claim financial compensation for the non-fulfillment of the contractual and organizational obligation of the director derives from his activity as an administrative body, expressed in both active and omissive behavior and the company has the right, through the body of shareholders' meeting, to decide to take legal action against the director.

The protection of real rights includes claims regulated by the norms of real law — reclamation claim, negator claim, claim for defining boundaries, claim for incompleteness and errors in the cadastral plan. These claims have a real nature and by exercising them, the owner of a real right aims to have any violation of his right by other entities recognized and stopped. The defense consists in recognizing the plaintiff’s right in rem and ordering the defendant to cease the infringement. Therefore, the claimant must prove his right of ownership (or other limited right in rem) to the suit property.

In bankruptcy proceedings, one of the main functions is that of the bankruptcy trustee.
1. Function, competence and limitations:
With the opening of the procedure, a temporary bankruptcy trustee must be appointed, after which the permanent bankruptcy trustee is elected by the creditors’ meeting, which monitors the regular course of the entire procedure. The bankruptcy trustee, in addition to the powers identical to those of the permanent bankruptcy trustee, has the obligation to prepare initial documents such as a list of creditors, a list of creditors who are or were connected to the debtor in the last three years before the opening of bankruptcy proceedings, a statement of the balance sheet of the company, etc. Next follows the first meeting of creditors with accepted credits, at which a permanent bankruptcy trustee is appointed.