Composition and liability of the council
In practice, the foundation council is the highest body within the organisation. It concerns itself with the management of the assets and monitors distribution to beneficiaries unless there are other regulations which apply. As a rule, the council foundation is composed as a collegial body of several persons who have joint responsibility for the overall management of the foundation.
Composition of the foundation council
For the most part, the organisation of a foundation can be determined by the founder (see blog entry). Organisational structure in accordance with the purpose is important since it is through its internal bodies that the foundation operates. In practice, the creation of a foundation council as the supreme body within a foundation has become the established norm. As a rule, the foundation council is a collegial body comprising several persons. An odd number of foundation councils is recommended to ensure that decisions do not often end in stalemate situations. Natural persons (private individuals) and legal persons can generally be elected to a foundation council.
The supervisory body (see blog entry) does not generally intervene in regulating organisational structure unless there are unsolvable personnel issues. They can then arrange for measures such as the dismissal of members of the council.
The election of council members is also at the foundation’s discretion. Potential candidates are the founder themselves, the existing foundation council members, people from the assembly of beneficiaries, bodies of other legal persons, or the supervisory body.
Entry in the commercial register:
All foundation council members must be entered into the commercial register (Art. 95 Para. 1 (i) HRegV (Commercial register ordinance)), this also applies to foundation councils which have no signing authority. The commercial register also requires information on the number of members of the foundation council, personnel composition, those with authority to sign, as well as any other changes.
Liability of the foundation council
The members of the foundation council shall be liable to the foundation if they cause damage due to a culpable error. Accusations of making a mistake can be made if the foundation council deviates from the objective, specific conduct expected in such a situation. Like an employer, the Foundation council either has contractual or tort liability (e.g. damage to property or personal injury). The foundation council is also under an obligation to carefully perform its duties. They are not liable for the success but the foundation council must undertake all reasonable effort to attain success. Liability is mandatory law and cannot be excluded.
There is only a liability for tortious acts with regards to beneficiaries and third parties.
