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EN
The new Civil Code has introduced the opportunity to seek so-called secondary damages, which were previously not recognized by Czech courts. Secondary damage is understood as harm suffered by members of a business corporation as a result of damage caused to the corporation by another member or director/officer. First, the authors refer to how difficult it is to define secondary damage in terms of the new civil law. They emphasize that the right to seek compensation for secondary damage (a member files a lawsuit on its own behalf) must be distinguished from so-called derivative claims (a member files a lawsuit on behalf of the corporation and acts as its statutory representative). They also point out particular problematic issues resulting from the new rules on secondary damage, e.g. in respect of secondary damage lawsuits pending simultaneously with primary damage lawsuits or an admission of secondary damage and the consequences thereof as regards the primary duty to compensate harm. Moreover, the authors outline other issues associated with the new Civil Code’s rules applicable to secondary damage and warn against “separating” secondary damage from primary damage since primary damage must exist in the first place before secondary damage can be sought.
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