Answers to open questions

Board Discuss
#1

Although most of the questions have been answered either in writing or during the Q&A session at the end of the LibreOffice conference, some community members have asked for specific answers to what are still considered open questions.

Before giving a specific answer to these open questions, let me repeat what I repeated at least three times during the Q&A session:

  1. The extraordinary decision taken by the Board has been extremely difficult to take and has required an increase in voluntary work in order to find the appropriate legal support (which has been confirmed by the opinion of two independent lawyers);

  2. The unfortunate situation has confirmed the need to improve the election rules to ensure that similar situations do not occur in the future. The change to the voting rules, once agreed by the BoD, will be shared and discussed publicly with the TDF Trustees;

  3. The extraordinary decision is not related to a person and their affiliation, as it would have been the same if any other member or deputy of the previous BoD had been elected to the Membership Committee (i.e. Thorsten Behrens, Emiliano Vavassori, Gåbor Kelemen, Ayhan Yalçınsoy and Gabriel Masei), due to the incompatibility between the oversight role of the Membership Committee and the 2024 audit of the actions of the Board in 2023.

These are the open questions:

1. claim of illegitimacy: what is the basis for a claim of illegitimacy / disqualification of the elected member’s candidacy (as opposed to whether it is desirable or not) (found here);

2. power to disqualify a candidate retroactively: what gives the BoD the power to disqualify a candidate retroactively, given clear rules exist for handling possible situations of CoI? (found here);

3. being transparent: while working to be as transparent as possible with the community, as far as legally allowed, the board does not share either the legal statements received about the power to modify elections outcome, nor information about why it possibly can not share (see here);

4. the situation of the MC and audits: there is no information yet, showing that according to the foundation’s rules, or the practice of the past years, there would be a situation of ‘judging in ones own case’ when a BoD member becomes a MC member afterwards (details here).

I will start with the last question, because the legal opinions answering this question have been known to all members of the Board since March 2023, when both the lawyer of the foundation’s head association and a lawyer from the law firm Winheller explained how the audit works, confirming what TDF’s general counsel had already stated before:

Lawyer from Foundation’s Head Association

“I am happy to provide you with an assessment regarding which of the three bodies (Board of Directors, Membership Committee, and Board of Trustees, cf. Art. 6 of the Statutes) has the power to appoint the auditor and which body must sign the engagement letter.

In fact, this cannot be clearly deduced from the Statutes. However, in my opinion, the competence to appoint lies with the supervisory body and not with the board of directors. This is also in line with very common practice, as otherwise supervisory rights cannot be exercised effectively.

According to the conception of the statutes, which I remember well, the primary supervisory body is the Membership Committee. It represents the foundation against members of the Board of Directors; the wording, which is almost identical to the German Stock Corporation Act, and also the other tasks and structure of the body show the clear parallel to the Supervisory Board of a stock corporation.”

Lawyer from the Law Firm Winheller

“It must therefore be deduced from general legal principles into which area of responsibility the task of selecting and/or commissioning the auditor falls according to the internal constitution.

The German Stock Corporation Act contains a clear provision in Section 111: “(1) The Supervisory Board shall supervise the management of the Company. (2) The Supervisory Board may inspect and audit the company’s books and records as well as its assets, namely the company’s cash and its holdings of securities and goods. (
) It shall issue the audit mandate to the auditor (
).” The competence to appoint, i.e. the selection of the auditor, lies with the Annual General Meeting (§ 119 para. 1 no. 4 AktG)

In principle, the provisions of stock corporation law cannot be directly applied to foundations. However, the Membership Committee (including the members’ board of trustees) is to be assessed on the basis of the regulation in § 12 para. 1 of the foundation’s statutes: “The Membership Committee represents the foundation judicially and extrajudicially against the members of the Board of Directors.” This corresponds in its content fully to § 112 AktG. Thus, the allocation of tasks is to a certain extent based on Stock Corporation Law. The membership committee is therefore similar in concept to a Supervisory Board under Stock Corporation Law. The different information obligations under § 9 (5), in contrast to § 8 (4) d. of the Foundation Statutes, also speak in favor of an orientation towards stock corporation law regulations.”

This means that all members of the previous board have known since March 2023 that the reason given against the election of a 2023 board member into the 2024 membership committee, i.e. the incompatibility between the supervisory role of the Membership Committee and the 2024 audit of the actions of the board in 2023, creates a clear CoI.

Although the principle that no one can be a judge in his own case is a fundamental legal principle that exists in most legislation, and was confirmed verbatim by the lawyer, I can give those who were not part of the previous Board the benefit of ignorance of the law. But those in possession of this information should have avoided raising a problem whose solution had been known for 18 months, thus creating a conflict situation within the project that was not necessary.

The Board’s decision was also supported by the expert opinion of a renown lawyer, who specialises in foundations and non-profit organisations, with whom the Board discussed the matter before announcing its decision (the text dates back to September, before the Board of Directors announced the decision, and this is the reason for verbs in the present and future tense):

However, the appointment of a member of a governing body, which is the case here, takes place in a total of three steps (according to MĂŒKoBGB/Leuschner, Section 27 para. 13):

1. (Election) resolution of the responsible body (here: members’ board of trustees)

2. Execution of the appointment resolution by means of a declaration of appointment to the elected person

3. Acceptance of the appointment by the elected person

The election resolution of the board of trustees is undisputed, and the election procedure itself was not called into question during the “challenging phase”. In my opinion, a declaration of appointment to the elected has not yet been made; only the “preliminary results” are available, and thus the election result has not yet been determined and announced by the body responsible for this.

The election of the Membership Committee is prepared and monitored by the Board of Directors, § 12 para. 2 sentence 2. In my opinion, this also results in the responsibility for the announcement of the (final) election result and thus also the declaration of appointment to those elected. It is only after this that it is possible to actually accept the election.

However, by appointing a candidate who is subject to conflict, the Board of Directors would possibly violate its own duties. According to § 8 para. 4 sentence 1, the board of directors must already prevent possible conflicts of interest, not only eliminate them, but prevent them in advance. It would also be absurd to confirm a conflicted candidate (especially if the conflict is already public knowledge and the subject of discussion) for the office in the Membership Committee, who would then have to be excluded by the board due to the conflict of interest in accordance with § 8 para. 4 sentence 3.”

It follows from this opinion - which confirms the correctness of the Board’s decision - that open questions 1 and 2 are in fact misplaced, since the election of the candidate never took place and therefore there was no claim of illegitimacy, and the Board did not exercise any power to disqualify a candidate retroactively.

Quite simply, the candidate was not elected because the official announcement of his election never took place, much to the chagrin of those who still claim otherwise.

At this point, I recall that all of this was written - albeit in a different way and in less detail - in my posts, and was said at least three times during the Q&A session at the end of the LibreOffice conference.

And I also remember that when these things were said, there were people who protested loudly, including those who knew very well - since March 2023 - that the decision was in line with the dictates of the law, because the Membership Committee’s oversight role in relation to the 2024 audit, analysing the work of the 2023 Board, would have created a conflict of interest that could not be justified to the authorities, since it could have been eliminated a priori (as it was).

At this point, of course, the question of transparency falls away.

However, everything that has happened should not be underestimated, so the Board will try to improve its communication with the TDF Trustees - some of which has already happened and will continue - and will take steps to avoid the recurrence of exceptional situations that could cause problems and friction within the project.

We have already mentioned the revision of the election rules, but there are certainly other areas where improvements are needed. We also expect to receive suggestions from TDF Trustees.

1 Like
#2

Hi @italovignoli

I believe there’s an important part missing from that statement:

However, unlike stock corporation law, the statutes do not provide for explicit representation by the membership committee under civil law as a rule, which is why the signature on the contract with the selected auditor would have to be provided by the board of directors. However, since this does not correspond to the supervisory function, the membership committee should award the contract.

The pre-selection of the auditor and the drafting of the contract are therefore the sole responsibility of the membership committee. However, since in the present case there is a further body in the form of the board of trustees and this is similar in parts to the general assembly of a stock corporation, the formal final decision on the selection should as a rule be made by the board of trustees. In the comparable stock corporation, this competence is incumbent on the General assembly (cf. Section 119 AktG). However, the fact that the appropriation of the balance sheet profit in the case of a stock corporation is also decided there speaks against this. The members of the Board of Trustees may in principle be asked to vote voluntarily (Art. 11 Para. 1 Sentence 2 of the Statutes), but they are not called upon to make positive decisions.

In summary, the ultimate authority to approve the pre-selected auditor sits with the full board of trustees, according to this legal opinion.

The above interestingly has never been followed, despite constituting legal advise. It also opens the question (if the exclusion from an MC role would be legitimate), if then all past and present board members must be excluded from the board of trustees, too?

Agenda Requests
#3

While I do not see the relationship between an election which did not happen - no one was excluded, as per the lawyer’s explanation - and the exclusion of Board of Directors members from the board of trustees, I would prefer to consider this as a lesson for the future. A toxic climate creates collateral issues: I do not think that there was negligence in 2023, but the never ending discussions on other topics forced a quick decision about the Auditor, and the opinion of TDF Trustees was overlooked.

Something similar happened this year. Again, no intentional negligence, but the consequence of toxic relationships - inherited from the past - also forced a quick decision about the Auditor, and the opinion of TDF Trustees was overlooked again.

By the way, you mention a 2023 document, which should have been made public by the previous BoD. As a TDF Trustee in 2023, I was completely unaware of that document, which I have discovered while studying the issue related to the MC elections. But, again, I do not think that you and the other BoD members overlooked this document on purpose, and we did exactly the same.

In 2025, the process has to start early in order to give all TDF Trustees the opportunity of contributing to the selection. Of course, we will have to define a process, as a group of almost 200 people can transform any selection process in a never ending story, but I am sure that we will be able to find a solution. In my experience, there is at least a good solution for any problem.

#4

Just a small comment about this:

I guess you meant “allow the BoT to appoint the auditors” as the [pre-]selection is made by the MC, the BoT would only confirm or reject the proposed auditors.

#5

I agree, Italo, this is the approach to take if we are to move on in the cases under consideration. But we urgently need safeguards to prevent repeats.

  1. Unfortunately there have now been several examples of decisions being taken without an adequate process due to “running the clock down” and I think we need to take steps to prevent that happening again. Fait accomplis followed by “let it go” is a toxic pattern and needs to stop.
  2. We also need to ensure that all trustees are involved in decisions where there is no completely clear process for the MC and/or Board to follow. It is simply not OK for either body to make up processes without Trustee review.
  3. I am also very concerned that requests for review of decisions are left without adequate response. When a decision is taken by just the MC or just the Board, there needs to be a clear requirement and process for appeal to the full Trustees. That is what should have happened in the recent election case and my proposal to do so was simply ignored by the majority.

I have other concerns, but I’ll leave things with those three points for now.

1 Like
#6

On the contrary, the board’s action’s illegality is supported by the opinion of the two independent lawyers.

How can I say that? On the exact same basis as your statement, that is: No basis at all. You can’t have it both ways. Either you present your question to the lawyers and their complete response, or if you believe it cannot be shared with the trustees, then you can’t rely on it.

And I’ll also say that relying on partial quotes from legal opinions can be just as bad, if not worse. Thorsten’s reply to your post demonstrated how the selective removal of text can create the opposite impression than the author had intended.

There would be little use in improving the rules, if the BoD can disregard the statutes, so far with impunity
 so it should perhaps be concluded that the BoD must not be allowed to run MC elections on its own. Their manipulation is apparenly too tempting for it. At the same time, I would not be against a cooling-off period of at least one term between serving on the BoD and the MC; although there is the situation of “BoD minority” individuals who decide they wish to express their point of view in the context of supervisory activity, where actual executive activity is denied them.

I might have considered this argument on its merits, had it not been the case that BoD made the opposite argument through the retroactive removal of Cor. If that had been the BoD’s position, it would have taken this decision before the elections.

(I plan to address the rest of the post, expect an edit.)

Actually, there is no such thing as ‘retroactive disqualification’. You’ve removed an elected member of the MC. You did not even re-run the elections, allowing trustees the opportunity to consider whom to support, and perhaps whether to submit their own candidacy, with Cor being disqualified. You also didn’t allow for the challenging of this disqualification - through the existing MC, the BoT or even legal means.

The BoD (not just the current one) has worked to be opaque, not transparent. “as far as legally allowed” - on the contrary, the BoD’s level of opaqueness is squarely illegal, being in direct violation of the statutes. You can’t sneak in laudatory statements about yourselves into a supposed question.

That’s a statement, not a question. Anyway, even if, in past years, MC activity has involved cases of someone “adjudicating one’s own affairs” - that’s just wrong and must not happen. Clarifying this, and backing it up with trustee-visible legal opinion, should be quite enough to prevent it from occuring.

If Thorsten’s BoDs, or yours, were to obey the statutes and share those documents with us - which you really must have done - then, collectively, us trustees are likely not to have let you overlook them for all those years.

The question of what lesson this elections will teach us in the future depends on whether the BoD’s action is allowed to stand. So far, the lesson is:

  • The BoD can act with impunity even in the face of massive trustee outcry.
  • The MC does not check the BoD, having no will nor motivation to perform a proper supervisory function.

So that we, as an organization, learn the proper lesson, these three things need to change. By the way, Simon, have you expressed your support for the complaint? We need to get to about 65 supporters to get past MC gatekeeping.

#7

I was only able to look closely at this post after the townhall meeting yesterday.
Reading now closely, I really have been blinking with my eyes several times


Italo repeatedly and extensively talks and writes about his marketing experience and qualities. Also this post is an excellent example: it gives the impression of legitimacy, where there actually no.
Let me explain.
I’ll show that first three questions listed here continue to be relevant. There was an attempt to handle the fourth in this post, leading to three pressing questions I’ve formulated further down in this comment. I’m getting more and more curious to see the two legal advises that the board received in full.

Let me start with an omission in the boards considerations that already has been mentioned several times, pops up again. Quoting Italo’s own text:

First, as is shown by Thorsten, who noticed the part that Italo didn’t quote:

But
 even if the MC would actually supervise the audit, which is not the case, the argument seems moot, since our CoI policy and standing procedures say that in case of a CoI, a person must abstain.
So the question remains: why did the board not consider this? (And do read on before you think stonewalling this question is an option.)

It gets more interesting here, with the two following snippets:
Italo:

Laywer:

It’s interesting, and definitely not in a positive sense, that the lawyer does not refer to the second sentence of 8.4.3 (see Statues): “It ensures therefore that a maximum of one third of the members of the Board of Directors, the Membership Committee and the Advisory Board are employed at the same firm, organization or entity or one of its affiliate organizations.”
So this seems to be very specific for the 1/3 rule.
The advise does not explain why it can also be used for individual CoI situations. (Or it does, but that part is not shared by Italo, which seems odd, since it is important to make the argument.)
So the question comes up: did no one in the board realize/notice that there was a very specific selection quoted from the statues?

Now imagine that indeed there would be a strong ground to say that the first sentence of 8.4.3 is not related to the rest of 8.4.3 and that it would also apply to CoI in general.
The question then is: has the lawyer and the board then considered that there is a huge problem in TDF? Many people have CoI’s at various places. For example, right now, there are four board (edit: added the word board, that missed) members with significant portions of either their personal, or company income, originating in TDF. And there are more.

#8

Mentioning my marketing experience while answering to a text where there is not a single reference to marketing is not the best way to start, but you did the same when you accused me of being a liar. This approach speaks for itself, but was expected, as this is your style, a very bad style.

The document which - according to you - I have only partially quoted was received by the BoD you were a member of in March 2023, and should have been shared with all TDF Trustees at that time. So you are responsible for a complete omission which happened 18 months ago.

Referring to conflicts of Interest, it is funny to hear a lesson from someone who has been in Conflict of Interest for ages, and had the irresponsible behaviour of applying for the election to the MC while knowing since March 2023 that this would have created an even worse Conflict of Interest.

By the way, if it is true that part of my income is originating from The Document Foundation, the amount of that income has been decided by past Board of Directors, and everyone knows that I have never asked for an increase of that income, and when there was an increase that was decided by the BoD without being asked for. Last, but not least, to avoid Conflicts of Interest during my current board term, I have asked to have my compensation frozen for the entire term. In addition, I abstain from discussions and decisions about human resources.

The Conflict of Interest created by your election would have been rather different, as you would have been at the same time part of the supervisory body and part of the supervised body, and abstention would have not been enough because by being part of the supervisory body you would have received information and documents that you should not have received as a member of the supervised body, especially because you were involved in actions which have already been declared as improper by the first Audit.

#9

I read piles of posts with passive aggressive language towards me.
But pls. do work on an answer for the questions.

#10

Fantastic, first you insult me by telling I am a liar, and then claim to be a victim.

#11

Cor is using the age-old tactic of doing provocative actions and statements left and right and then playing the victim when people don’t just roll over. This behaviour is a net negative for TDF and needs to stop.

1 Like
#12

This is the sentence which makes it clear the opinion of the lawyer Mr Vielwerth:

However, by appointing a candidate who is subject to conflict, the Board of Directors would possibly violate its own duties. According to § 8 para. 4 sentence 1, the board of directors must already prevent possible conflicts of interest, not only eliminate them, but prevent them in advance. It would also be absurd to confirm a conflicted candidate (especially if the conflict is already public knowledge and the subject of discussion) for the office in the Membership Committee, who would then have to be excluded by the board due to the conflict of interest in accordance with § 8 para. 4 sentence 3.

#13

Yes, that is what I quoted as follows:

leading to the following:

#14

Italo, still thinking about the following:
You said during the 2nd townhall meeting “the lawyer says this is a special CoI category that needs special treatment.” to explain why it is no option the normal way of handling CoI not followed. You said that I should have read that is this post. And sorry, I must be reading not good enough, but miss where a lawyer says this is a kind of CoI that needs special treatment. What you quote in comment 12 does not precisely explain that, I think, after all there are many cases in which a CoI is visible (in advance), some of these mentioned in the townhall meeting today.

(Then also there is the fact that the statement that the MC supervises the audit is not at all solid.
Which makes me realize what the source is of this comment from you on me:

It was Thorsten who pointed out that a part was missing; I referred to what he wrote comment 2.
But that for later.)

#15

We can also have a pre-selection of two different auditors, and have TDF Trustees decide which one is the one to choose.

#16

I would agree that we had a huge problem with directors not handling correctly their conflicts of interest.

That’s a discussion we had several times over the years but it seems that the matter is not clear for you yet.

The 02/06/2022 you received yet another confirmation of how the board should handle conflicted directors when you asked to the legal team “Is it fair to exclude members from a discussion based on just a possible mis-behaving?”

The answer was:
"The specific behavior of a fundamentally conflicted person can never be anticipated with certainty, which is why these participants could be excluded from the discussions on the basis of previous behavior and the existing conflict of interest for the benefit of the foundation.

As a milder approach - also from a legal perspective - participation could initially be permitted, but the conflicted board member could be excluded from further deliberations by the chair of the meeting if conflicts of interest arise or attempts are made to influence the non-conflicted members on this basis.

In this way, the members of the Board of Directors could initially comply with their will to find a solution for the benefit of the foundation (in accordance with the duty of loyalty)."

It’s 2 and a half years today that you received that answer, do you still need additional clarifications?

1 Like
#17

Question to the board.
Apart from that IMO the role of the MC is unclear, we do have rules in place allowing directors handling correctly their conflicts of interest.
According to the above, still the board has chosen to use 8.4 (preventing CoI by removing people from a body if the maximum of one third of the members of the Board of Directors, the Membership Committee and the Advisory Board are employed at the same firm, organization or entity or one of its affiliate organizations) to change the outcome of the elections.
Is the board also planning to apply that rule to the composition of the Board of Directors?

#19

Looks as if there is inconsistency in the answer given related to statues 8.4 in how and/or when the board chooses to apply the rule. Hence I ask for clarification in this thread.

Impressum (Legal Info) | DatenschutzerklĂ€rung (Privacy Policy)   Content on this site is licensed under a Creative Commons Attribution Share Alike 3.0 license.