OGH: Dismissal of an advisory board member on important grounds

Sept 1, 2021 Benn-Ibler Rechtsanwälte

Whether there are important grounds within the meaning of Sec. 27 (2) of the Private Foundation Act (Privatstiftungsgesetz, PSG) for the dismissal of a member of a foundation's governing body is, according to the established case law of the Austrian Supreme Court, always to be seen from the point of view of the functioning of the private foundation. The pursuit of the foundation's purpose must be guaranteed with sufficient certainty in the future.

In the foundation deed, an advisory board was established in the present case. The private foundation as applicant now applied for the dismissal of the members of the advisory board. They had indirectly damaged the applicant's subsidiary, and thus the applicant itself, through their actions.

Past decisions on the judicial dismissal of members of the governing bodies of a private foundation for cause pursuant to Sec. 27 (2) PSG have so far dealt with the judicial dismissal of members of the executive board of a private foundation, but not with the judicial dismissal of members of an advisory board established in the foundation deed. The question of whether the member of an advisory board is to be dismissed is - according to the Supreme Court - assessed according to the same principles.

The lower courts followed these principles and in the present case denied the existence of an important reason for the dismissal of the defendants as members of the advisory board.

Whether there are grounds for dismissal is closely linked to the competences of the governing body and its members, according to the Supreme Court. The executive board of a private foundation is responsible for the (entire) administration and representation (Sec. 17 (1) PSG), bookkeeping and accounting (Sec. 18 PSG). The advisory board - in the case at hand - was only given information, consultation and hearing rights, among other things.

Thus, there was nothing to contradict the assessment of the lower courts, according to which the members of the advisory board cannot have a detrimental effect on the functioning of the private foundation and therefore there is also no important reason for their dismissal.

OGH 6 Ob 93/21a (23.06.2021)