Background

The impact of the opening of insolvency proceedings on options granted in combined contracts (for example, a lease contract containing a call option for the leased real estate) had been in dispute for a long time.

Decision

The Austrian Supreme Court held that call options granted in lease contracts where the option fee has been paid do not expire with the opening of insolvency proceedings, nor are they subject to the right of the insolvency administrator to terminate the lease contract.  

Consequently, those options can still be exercised by the option holder even after the opening of insolvency proceedings. 

The insolvency administrator, however, has the right to declare non-entry into the (purchase) contract resulting from the exercise of the option, essentially voiding the purchase contract. The only recourse available to the option holder is that they are entitled to claim for the damages resulting from the non-entry by submitting a claim in the insolvency proceedings (to be satisfied on a pro rata basis).

Find out more

To discuss the issues raised in this article in more detail, please contact a member of our Restructuring & Insolvency team.

European Case Law Identifier: ECLI:AT:OGH0002:2022:0170OB00014.22S.1124.000