What happens if a contracting party becomes insolvent?
November 22, 2022 | 40,00 EUR | answered by Gertrud Knorr
Dear lawyer,
I am reaching out to you with a question regarding contract law. My name is Wolfgang Köhler and I work as a freelance graphic designer. Some time ago, I entered into a contract with a partner company for the creation of an extensive marketing campaign. Now I have learned that this partner company is facing insolvency.
My concern now is what will happen if my contracting partner actually becomes insolvent. Will my already provided services not be compensated anymore? Do I still have to deliver the already agreed upon services? What options do I have as a contracting partner in this case to protect my interests and secure my financial claims?
I am very worried about my professional existence, as the contract with this partner company is an important source of income for me. Therefore, I would appreciate your legal assessment and possible solutions on how I should best handle this situation.
Thank you in advance for your support.
Sincerely,
Wolfgang Köhler
Dear Mr. Köhler,
Thank you for your inquiry regarding contract law and your concerns regarding the insolvent partner company. As a freelance graphic designer, it is important to know your rights and claims in order to protect your professional existence.
If your contracting partner becomes insolvent, this can of course have implications for the existing contract. There is a risk that your already provided services may not be remunerated and that you may still be required to fulfill the agreed services. In such cases, it is important to inform yourself about your options in a timely manner and protect your interests.
Firstly, you should check if the contract contains a provision regarding the insolvency of the contracting partner. Often contracts include clauses that specify how insolvency will be handled and what rights and obligations exist in such a case. If there is no such provision, the legal provisions of insolvency law apply.
In the event of insolvency, as a creditor, you can file your claims with the insolvency administrator. The administrator then examines to what extent your claims can be considered. It is important to have all relevant documents such as contracts, invoices, payment receipts, etc. ready in order to assert your claims.
It may also be advisable to contact the insolvency administrator early on and explain your position as a contracting partner. You may be able to reach an agreement to protect your interests and come to a resolution.
If you are unsure or need further legal advice, I am happy to assist you. It is important to act early and secure your rights in order to protect your professional existence.
I hope this information is helpful to you and I am available for any further questions.
Best regards,
Gertrud Knorr
