Agency mandate after insolvency opens: Continue working or obtain a new instruction?

Labeling a contract as a mandate does not determine its classification. The decisive factors are the business undertaken and the overall nature of the agreement. An ongoing agency relationship may fall under § 26 Abs. 1 IO even if it also involves practical services or individual deliverables. This does not mean that every contract of an insolvent company automatically ends.

In 8 Ob 7/93 on 26 January 1995, the Austrian Supreme Court examined a tax adviser who provided ongoing bookkeeping, payroll, accounts, and tax returns. The Court classified the overall relationship as an agency contract and held that the existing mandate had ended. A one-off expert opinion or a separately commissioned set of accounts may require a different classification, and a reciprocal contract still outstanding on both sides may instead require assessment under § 21 IO.

§ 2 Abs. 1 IO anchors the legal effects of opening to the start of the day after the public announcement of the insolvency notice. Retain the notice and determine the timing for every outstanding act. § 1024 ABGB sets a distinct starting point for the effectiveness of acts of representation at the announcement itself. Consequently, the internal mandate and representation toward third parties demand separate assessment.

Case law restricts the termination of the mandate to business regarding the estate that can diminish its assets. Mandates involving assets outside the estate require separate treatment. Termination generally operates prospectively and does not retrospectively undo earlier valid acts. This distinction is particularly important where payments, dispositions, or agreements involving several parties already exist.

§ 26 Abs. 2 IO generally keeps a contractual offer in force if a service provider made it to the debtor and the debtor had not accepted it before opening, unless the circumstances indicate a different intention on the part of the offeror. Conversely, the insolvency administrator is not bound by an offer the debtor made which had not yet been accepted under § 26 Abs. 3 IO.

Therefore, for the agent, evidence of contract formation determines the next assessment. Place the offer, acceptance, and evidence of receipt alongside the opening notice. Should the mandate have already been accepted, examine its possible termination under Abs. 1. The rules on outstanding offers do not replace that assessment.

Should the insolvency administrator wish to retain the agency services, the parties should agree on a new mandate with a clearly defined scope. Record the identity of the person acting for the estate, the tasks undertaken, their start date, and the basis for remuneration, and confirm acceptance of the mandate. Written documentation supports proof, yet this does not create a general statutory requirement for written form.

The decision in 8 Ob 7/93 demonstrates that authorisation alone fails to establish a secure contractual fee claim. The Supreme Court examined a possible new instruction and the necessary acceptance as separate issues. Without proven acceptance, the tax adviser could not base the contractual claim on that instruction. The court remitted the case for consideration of another legal basis. Consequently, simply continuing work or receiving no objection provides no reliable contractual foundation.

Fees and expenses for the period before opening do not automatically vanish when the mandate terminates. The contract and the work performed determine whether a claim exists and what its amount is. Financial claims against the debtor that already existed at opening generally constitute insolvency claims under § 51 IO. Issuing an invoice later does not convert these claims into estate claims.

A new instruction from the insolvency administrator may create an estate claim under § 46 Z 5 IO, but the instruction, acceptance, and services must belong to the new relationship. The Supreme Court clarified in 8 ObA 116/03x of 16 July 2004 that winding-up claims from a terminated trust mandate do not become estate claims simply because the mandate ended. Unauthorised continuation does not ensure payment either, since agency without authority and unjust enrichment each have their own requirements and evidential basis.

List the outstanding matters before taking the next step: pending payments, prepared declarations, money held, documents, and current deadlines. Also add the old mandate, powers of attorney, work records, and correspondence with the insolvency administrator. If a specific loss is imminent, identify it promptly and request a clear decision on the necessary measure. General urgency does not replace the authority to make a new disposition.

In a multi-party trust arrangement, other participants may retain rights and the agreed completion mechanism may continue to apply. The Supreme Court clarified this principle on 21 November 2006 in 4 Ob 163/06h, especially when the trust secures performance of another contract. Consequently, insolvency alone justifies neither arbitrary onward transfers nor the indiscriminate removal of funds from every existing arrangement. One must assess the underlying transaction, performance status, and third-party rights together.