STS 1129/2026: The Supreme Court requires actual damage to bring a claim for breach of the duty of loyalty.

Judgment STS No. 1,129/2026, of 13 July, dismisses the derivative action for liability brought against a director and general manager who entered into an exclusive contract with a related company without prior express authorization from the board of directors, on the grounds that it was not proven that the services had been invoiced above market price.

The First Chamber of the Supreme Court holds that a breach of the duty of loyalty, even where related-party transactions are carried out without prior express authorization, does not automatically give rise to liability unless actual harm to the company's assets is proven. It likewise rejects the recasting, on cassation appeal, of a claim for "overprice" damages into a claim for restitution of the director's unjust enrichment, where the latter action was not pleaded in the complaint.

Consequences:

• Dismissal of the derivative liability action brought for €399,281.87 in respect of overpricing in related-party transactions.
• Confirmation of the acquittal judgment of the Provincial Court of Barcelona (Section 15).
• The appellant on cassation ordered to pay costs.
• A substantive question left unresolved: the scope of the unjust enrichment restitution action under Article 227.2 of the Spanish Companies Act (LSC).

Background:

PONGO SELF STORAGE, S.L. (formerly LOOK THE BOX, S.L., hereinafter "LTB"), a company engaged in fitting out and marketing self-storage units, was incorporated in January 2015 with EMESA CORPORACIÓN EMPRESARIAL, S.L. holding a majority stake (51%). Under the shareholders' agreement, Mr. Moises — a shareholder and director of BOX INFINITI SELF STORAGE, S.L. (10% of the share capital) — was appointed general manager of LTB and granted general power of attorney for transactions of up to €15,000.00.

For the fit-out of the eleven self-storage centers that LTB would operate between 2015 and 2018, Mr. Moises engaged RUTA WIN, S.L. — a company of which he was the sole shareholder and director — on an exclusive basis, without prior express authorization from LTB's board of directors, although the Provincial Court found that its subsequent ratification by that body had been established. These related-party transactions were not disclosed in the annual accounts for the 2015 and 2016 financial years.

LTB brought a derivative liability action under Articles 225, 227 and 238 LSC, claiming €600,232.72 for breach of the duty of loyalty: €399,281.87 for the overprice paid to Ruta Win (30% above market price, according to the claimant's expert) and €81,838.00 for undue remuneration paid to Box Infiniti. The latter claim was dismissed on appeal for lack of standing to be sued on Box Infiniti's part, a ruling that was not appealed and therefore became final; the cassation appeal decided by the Supreme Court concerned only the overprice claim.

Analysis of the judgment:

The Supreme Court, Civil Chamber (First Chamber), issued judgment on 13 July 2026 (Rapporteur: Hon. Ms. Nuria Auxiliadora Orellana Cano), dismissing both the extraordinary appeal for procedural infringement and the cassation appeal brought by LTB against the judgment of the Provincial Court of Barcelona, which had acquitted the defendants.

The corporate conflict:

The dispute arises from a conflict between the majority shareholder (Emesa, 51%) and the minority shareholders linked to the general manager (Box Infiniti and Mr. Moises, holding a combined 30%), in the context of a joint venture to operate self-storage centers. Mr. Moises, acting in his capacity as general manager and exercising his general power of attorney, engaged Ruta Win — a company of which he was the sole shareholder and director — as the exclusive contractor for the fit-out works on the storage units. This engagement, which continued from the outset of the business's operations, was not subject to prior express authorization by the board of directors, although the Provincial Court found that the board was aware of the connection and that the engagement was subsequently ratified by that body.

The three instances:

The Commercial Court No. 5 of Barcelona partially upheld the claim and ordered Mr. Moises and Box Infiniti to jointly and severally pay €481,119.87, identifying the harm as the extra cost arising from Ruta Win's unnecessary intermediation.

Section 15 of the Provincial Court of Barcelona overturned that judgment and dismissed the claim in its entirety. It found that Box Infiniti lacked standing to be sued, since its status as a de facto director had not been established. As regards Mr. Moises, while it confirmed that the engagement of Ruta Win constituted a related-party transaction subject to Article 229.1(a) LSC, it held that it had been ratified by the board of directors. In any event, it ruled out the existence of any harm, concluding on the basis of the expert evidence that the works had been invoiced at market price.

Legal issues analyzed:

A. Damage as an indispensable requirement of the derivative action.

The Supreme Court confirms the doctrine laid down in STS 449/2025, of 20 March: within the structure of the derivative liability action, the breach of the duty of loyalty must have caused harm to the company itself. A formal breach of the conflict-of-interest regime — even the absence of prior express authorization under Article 230 LSC — is legally irrelevant unless it is shown that the company suffered actual damage.

This conclusion means the Court does not rule on the substantive issues that the appeal raised with greater doctrinal interest — whether a waiver or its ratification must be express, which corporate body has competence to grant them, and whether the directors' awareness of the conflict amounts to tacit consent — since addressing them would lack any "useful effect" in the absence of proven damage.

B. The distinction between "overprice" and "extra cost": rejection of its autonomy.

The appellant attempted to establish the existence of damage by distinguishing between the overprice (the difference between the invoiced price and the market price) and the extra cost (the additional cost arising from Ruta Win's intermediation, irrespective of price). It argued that interposing a company with no employees of its own constitutes, per se, damage in re ipsa to LTB, equivalent to the profit obtained by the intermediary.

The Supreme Court rejects this distinction as "artificial": if invoicing was at market price and LTB did not pay more than it would have cost to contract directly, there is no compensable damage, whatever conceptual label is attached to it. The mere profit obtained by Ruta Win through the intermediation does not per se establish harm to the company. There is also a procedural reason: the ground was raised through the extraordinary appeal for procedural infringement, and the lower court's assessment of expert evidence is only reviewable on cassation where it involves a patent error or arbitrariness, which the Supreme Court rules out in this case.

C. The scope of Article 227.2 LSC and restitution of unjust enrichment.

The second ground of the cassation appeal invoked Article 227.2 LSC, under which a breach of the duty of loyalty gives rise not only to an obligation to compensate for harm caused to the company's assets, but also to an obligation to return to the company any unjust enrichment obtained by the director. The appellant sought an order requiring Mr. Moises to restitute the net profit obtained by Ruta Win through its intermediation, regardless of whether there had been any overprice.

The Supreme Court dismisses this ground on strictly procedural grounds: restitution of unjust enrichment was not sought in the complaint, which claimed only the overprice paid above market value. Recasting a damages claim as an unjust enrichment claim at the cassation stage would infringe the principle of procedural consistency (congruencia). The Chamber expressly declines to rule on the underlying question — whether this action may be brought autonomously or jointly with the derivative liability action — leaving open a litigation front of considerable importance.

Practical relevance:

• Damage must be proven, not presumed: A breach of the duty of loyalty — even where related-party transactions are carried out without authorization — does not raise a presumption of damage nor shift the burden of proof for purposes of the derivative liability action. The mere interposition of a related company is insufficient if the prices paid turn out to be market prices. This doctrine contrasts with the regime governing the action to annul under Article 232 LSC, where, unlike the derivative action, potential harm to the corporate interest suffices, without a direct and quantifiable damage being required.
• Procedural strategy in the complaint irreversibly delimits the subject matter of the litigation: A party claiming for "overprice" cannot recast its claim on cassation appeal to seek restitution of "unjust enrichment" if that action was not pleaded at first instance. Correctly identifying and delimiting the petitum — including the express joinder of compensatory and restitutionary claims — is decisive from the outset of proceedings.
• Article 227.2 LSC and restitution of unjust enrichment remain without a substantive answer from the Supreme Court: Whether this restitutionary action requires an autonomous claim or may be joined with the derivative liability action, and whether it requires prior proof of damage, will remain a significant litigation front in related-party transactions. The judgment resolves the case on grounds of procedural consistency without addressing the merits.
• The overprice/extra cost distinction is insufficient to establish damage: The judgment forecloses the theory of damage in re ipsa arising from the intermediation of a related company where it is not shown that the price paid exceeded market price. Intermediation, on its own, does not constitute compensable harm within the framework of the derivative action.

Conclusion:

Judgment STS No. 1,129/2026 reinforces that the derivative liability action is not an autonomous mechanism for sanctioning formal breaches of the duty of loyalty, but rather an instrument for compensating actual harm suffered by the company. A breach of the conflict-of-interest regime — however serious — does not give rise to liability unless the resulting financial harm is proven.

At the same time, the judgment leaves pending the question of greatest relevance from a substantive law standpoint: the scope and procedural regime of the unjust enrichment restitution action under Article 227.2 LSC, including whether it requires an autonomous action or may be joined with the derivative liability action. Pending a Supreme Court ruling on the merits, and without the judgment implying that restitution proceeds regardless of any financial harm, it may be anticipated that a future claim expressly pleading both the compensatory and restitutionary causes of action could more robustly seek restitution of the profits obtained by the director or a related party, irrespective of whether the price paid was or was not a market price.