Questions & Answers
The liability of a manager for bank loans after resignation
Dear sir/madam,
Please advise me in regards to my commercial banks!
A partial case in Dubai Courts in which my company (first defendant) took a property loan from a bank (plaintiff) in January 2015.
I had signed all bank-related documents including the personal guaranty form as a manager (second defendant) of the company holding 40% shares along with my partner (third defendant) holding 60% shares in a Free Zone Company.
I was asked to resign with immediate effect in December 2016 and left the company completing all necessary handovers of 40% shares to a natural person.
I hold all transfer documents attested by the free zone authority and their legal translation which were submitted to the court as a memorandum.
Today was my first hearing and the court decided and ended the litigation obligating all defendants jointly and severally to pay the balance amount to the plaintiff and 5% legal interest and attorneys fees.
Please advise on the next procedure I can follow to request the court to remove my name. Should I approach the bank?
Dear questioner,
It is absolutely necessary to appeal the judgment passed against you within 30 days of its announcement, moreover trying to settle with the bank could be a solution.
Getting out of a personal guarantee is difficult and we need to review this document to know if there is any point that we can use to invalidate it.
For more information, please contact us via WhatsApp.
Hello,
As per your query, You have availed the property loan through the company accounts, and have provided the personal guarantee of yours which proves that the loan was availed by you in the name of the company.
Even if you have sold your shares and exited, still you are liable. However, you can place an appeal for the case, if the court hears it or in cassation (but the chances are rare as per the facts).
After the bank opens execution, the only way is to make a payment plan in the court or to settle with the bank outside the court and restructure the payment plan.
We can help you to restructure the payment plan and to settle with the bank outside the court.
