The mother company argued that the daughter company had used and must repay her funds of EUR 373,000 from the group banking account. However, the court dismissed such claim against our client and clarified several crucial points related to the burden of proof related to the group bank account:
- Mother company must prove that daughter company used her funds on a group account;
- Mother company must provide information, which exact person undertook each transaction on a group account;
- In case transactions were undertook by a board member representing both mother and daughter company (or based on his/her orders), mother company must prove that transactions were made on daughter company’s behalf and interests.
As the mother company did not submit evidence on all issues submitted above, the court dismissed all claims against our client, and also decided to reimburse our client’s legal costs.
According to Chirag Mody, it is an important decision in Estonian court practice, as it clearly divides the burden of proof between a mother and daughter company and clarifies that daughter company cannot automatically be responsible for any transactions on group accounting funds.