Professional Fees of Law Firm & Personal Liability of Directors of the Company
Judgment dated 3.10.2026 of the LXIX Additional City Civil and Sessions Judge, Bengaluru (CCH70) in Original Suit No.7106 of 2023 of Krishnamurthy and Co (K Law) Vs. Moerheim Roses and Trading India Private Limited and others
The law firm filed summary suit for Rs.2,75,000/- outstanding professional fees out of Rs.6,10,000/- for the legal services and interest at 24% per annum. The Defendant Nos.1 to 5 had proceeded ex parte.
One of the issues was whether the defendant Nos. 2 to 5 are personally and jointly liable for the debt of the Defendant No.1.
- Point No.4 :- The Plaintiff has sought a decree against Defendant Nos.1 to 5 jointly and severally. Defendant Nos.2 to 5 are described as directors of Defendant No.1-company. However, the mere fact that a person is a director of a company does not, by itself, make such person personally liable for every contractual or commercial obligation of the company. 29. A company incorporated under law has a legal personality distinct from that of its directors. The liability arising from a contract entered into by the company ordinarily attaches to the company itself unless there is material establishing that the director or officer has independently undertaken personal liability, executed a 16 O.S.7106/2023Judgment guarantee, become a co-obligant, or otherwise incurred liability in his or her individual capacity. 30. In the present case, the plaint principally pleads that Defendant No.1 availed the professional services and that Defendant Nos.2 to 5 were its directors responsible for the day-to-day affairs of the company. There is, however, no specific pleading identifying any independent contract executed by Defendant Nos.2 to 5 in their individual capacities, nor is there any personal guarantee or undertaking produced showing that they personally agreed to discharge the professional fees payable by Defendant No.1. 31. The allegation that Defendant Nos.2 to 5 were responsible for the day-to-day affairs of Defendant No.1 cannot, standing alone, constitute an independent contractual promise to pay the company’s debt. 32. The absence of appearance by the Defendants and the resulting statutory consequence under Order XXXVII cannot be stretched to create a substantive 17 O.S.7106/2023Judgment personal liability against a person which is not otherwise established by the pleadings and evidence. The Court therefore finds that the Plaintiff has successfully established the debt against Defendant No.1, but has not established an independent legal basis for fastening the said contractual liability personally upon Defendant Nos.2 to 5. Accordingly, Point No.4 is answered in the Negative.
