SLOVAK CONSTITUTIONAL COURT SIDES WITH THE TOWN OF PRIEVIDZA IN DISPUTE OVER PRIEVIDZA HEAT MANAGEMENT

Košice 26 November 2019: Today, the Slovak Constitutional Court has upheld the constitutional complaint of Prievidza filed against a ruling of Bratislava County Court. The dispute over the managerial control over the company Prievidzské tepelné hospodárstvo (Prievidza Heat Management, PTH) is to return to the County court.

PTH supplies Prievidza with heat. The majority shareholder of PTH is Prievidza with a share of 51 %. The remaining 49 % are owned by the company Hornonitrianske bane Prievidza (Upper Nitra Mines Prievidza).

The town of Prievidza argued in the constitutional complaint that as a majority shareholder, it does not have real influence on the management of its own company and on the actions of the chairman of the board who is a nominee of the other shareholder. Pavol Poláček of the law firm Poláček & Partners explains: “According to the bylaws, a representative of Hornonitrianske bane Prievidza shall act on behalf of the heating plant jointly with a representative of the town. The aim of this mechanism is the protection of interest and property of both shareholders. None of them shall act in a way that puts the other one at risk”.

The mayor of Prievidza Katarína Macháčková notes: “On numerous occasions, the nominee of Hornonitrianske bane Prievidza on the board of PTH did not act in the manner prescribed by PTH bylaws and acted on behalf of the company on his own, without the representative of the town as major shareholder. Such conduct seriously endangers the enterprise. In fact, as the majority shareholder, we did not have any knowledge of the legal relations entered into by PTH. In the process of defending our rights, we made it to the Constitutional court and I am very pleased that today we have succeeded”.

The town of Prievidza entered into the dispute back in 2016. At first, the Bratislava IV District Court ruled in favour of Prievidza and stated that the representative of Hornonitrianske bane Prievidza may not act on behalf of PTH alone but shall do so together with a representative of the town. The Bratislava County Court overturned the decision. Thus, the town turned to the Constitutional court which has agreed today that the rights of Prievidza were violated in the County Court proceedings. The dispute returns back to Bratislava County Court which is bound by the opinion of the Constitutional Court.

“The decision of the Constitutional court paves the way for the citizens of Prievidza to demand a fair settlement of the dispute. Since 2015, the town of Prievidza has not had the necessary control over the management of the enterprise. Imagine a situation where you do not know exactly what contracts are concluded by your company. I stress that PTH is not a small enterprise. It is a strategic supplier of heat for the town of Prievidza. It is a regulated entity in energetics. It has hundreds of obligations towards regulators, state authorities or supply partners and must fulfil them properly and in accordance with the law” explains the mayor of Prievidza Katarína Macháčková.

Pavol Poláček of the law firm Poláček & Partners remarks: “In my opinion, the ruling of the Constitutional court is also significant for the legal practice. It clearly addresses how persons in managerial roles of commercial companies shall act”.