The Court of Cassation with a decision of 5 December 2016, No. 24791 confirmed that receivables of advisors who assisted the debtor with respect to a filing for concordato preventivo shall be considered as super-priority claims in the following insolvency liquidation, unless the advice is challenged in the merits

The case

A financial advisor whose claims, regarding the drawing up of financial statements of the company in connection with a concordato preventivo filing, were denied super-priority status in the proof of debt phase of bankruptcy liquidation, appealed to the Court of Cassation.

The issue

The issue relates to the conditions for claims of professionals to be granted super-priority status, based on the test that they arose from services «functional» to access the concordato preventivo insolvency procedure.

The decision of the Court

First, the Court of Cassation reverses the decision of the Court of Bari as to the part where the lower Court denied super-priority based on a reasoning which overlapped the two distinct and alternative tests provided by Art. 111, second paragraph, IBL, namely that the claim arises as «functional to» or «in the context of» an insolvency procedure. According to the lower Court, a claim can be considered «functional to» an insolvency procedure only when it arose after the procedure commenced (and, therefore, «in the context of» an insolvency procedure).

The Court of Cassation ruled that also pre-petition claims can be granted super-priority when, based on an ex ante perspective, they appear functionally and structurally aimed at accessing the procedure. The Courts cannot assess instead, on an ex post perspective, whether an actual advantage to the estate followed as a consequence of the advice and services rendered; the reason for this being that, otherwise, professionals would be treated unfairly when they were not paid before the concordato filing, thereby supporting the debtor as they accepted to be paid later, as compared to those that were instead paid before and benefited also of a specific exemption from claw-back action which is provided by law.


The decision of the Court confirms the interpretation which is most shared in case law, both at the level of the Court of Cassation and at that of the lower Courts (see Cass. 10 January 2017, No. 280; Cass. 4 November 2015, No. 22450; Court of Milan, 23 December 2016), but which is often disregarded by the bankruptcy receivers (at least as their initial position) in the proof of debt phase of bankruptcy liquidation procedures.

Super-priority should then be granted to claims based on services functional to the access to an insolvency procedure (such as, typically, the activities relating to the preparation and drawing up of the concordato preventivo filing or pre-filing and to assistance to the debtor), without any requirement to assess whether the services of the professional actually turned out to determine an advantage for the estate, which is inevitably based on an ex post perspective. In order to deny super-priority status to such claims, no circumstance which occurred afterwards can therefore be taken into account, such as the fact that the concordato proposal was not approved by the creditors or that the proposal was not duly performed by the debtor, but also that the debtor was not admitted to the procedure (see Cass. 1 November 2016, No. 23108), as all these situations are not under the control of the professional. The Courts instead can reject the claim altogether or determine that a lower amount is due, based on an assessment on the merit, when services were not properly rendered or no link can be shown with the access to the insolvency procedure in the case at hand. In this respect, an interesting example can be found in the decision of the Court of Monza (26 October 2016) whereby, with reference to an expert report (due to be filed with the demand for admission to concordato preventivo) which the expert issued as a «negative» report, the claim of the professional was not fully admitted because «the services cannot be considered as fully performed if the professional only issues an overall opinion in the sense that the restructuring plan is not feasible, based on a preliminary analysis of accounting information considered in the aggregate, without showing that he performed a thorough evaluation of the data delivered by the financial advisors, nor explaining the methodology based on which his negative opinion was rendered in the specific case, which indeed was limited to some sketchy remarks on some of the entries in the balance sheet».