The right to withdraw for just cause pursuant to art. 2119 of the Civil Code also applies to agency contracts, bearing in mind, however, that the fiduciary relationship in such contracts assumes greater weight compared to subordinate employment.
Court of Cassation, employment section, judgement no. 6915 of 11 March 2021
In the case in question, the principal withdrew from the agency contract for just cause because the agent had approached employees of the principal regarding a future business opportunity in competition with the company.
The Court of Appeal of Rome, in partially overturning the ruling in first instance, on the one hand rejected the agent’s request to obtain a declaration of the illegitimacy of the termination, and on the other hand ordered the company to pay the consideration for the non-competition agreement and the commissions accrued but not paid.
With reference to the legitimacy of the termination, according to the Court of Appeal the agent’s alleged conduct constituted a breach of art. 1746 of the Italian Civil Code, which requires that, in the performance of his duties, the agent must safeguard the interests of the principal and act with loyalty and good faith.
Consequently, “the breach of this duty, regardless of whether or not the initiative is successful, constitutes conduct in contrast with the agent’s essential duties and constitutes just cause for termination pursuant to art. 2119 of the Italian Civil Code”.
The agent appealed to the Supreme Court of Cassation, claiming the nullity of the judgement and violation and incorrect application of articles 2119 and 1746 of the Italian Civil Code, regarding the alleged breach of the duties loyalty and good faith.
As a preliminary point, the judges of the Supreme Court recalled how “the institution of withdrawal for just cause provided for by art. 2119 Civil Code in relation to the employment relationship, is also applicable to agency contracts, however, having to take into account, for the assessment of the seriousness of the conduct, that in the latter the relationship of trust – by virtue of the greater autonomy of management and performance of the activity – assumes greater importance than in the employment relationship”.
It follows that, for the purposes of the legitimacy of the withdrawal, for the Justices, a minor infraction was enough.
The judges cited a previous Supreme Court case in point, which stated that “the agency relationship is applicable, by analogy with the provisions laid down for the employment relationship, the institute of termination for just cause, however, in order to assess the failure of the worker, it is also necessary to take into account the typical elements of the two relationships with the consequences that the analogy between the two can operate only insofar as not in conflict with these elements”.
In the case in question, according to the Supreme Court, the Court of Appeal interpreted the notice of termination, pointing out that it contained a specific objection which, alongside the more specific one relating to violation of the non-competition agreement provided for in the agency contract, also alluded to violation of the canons of fairness and good faith to which the agent must be subject, as an expression of the duty of loyalty pursuant to art. 1746 of the Italian Civil Code.
In view of the above, the Court of Cassation rejected the agent’s appeal, upholding the legitimacy of the termination for just cause.