In corporate relations, a lack of response is often perceived as neutral behaviour – a decision “not to reply”, “not to object”, or “to wait” may appear safe and free of consequences. However, Professor Gabriel Steiner notes that in modern law enforcement practice, silence increasingly acquires independent legal significance. At LawConsulted, we treat corporate silence not as passivity, but as a factor capable of influencing the allocation of liability, the assessment of good faith, and the outcome of a dispute.
The core problem of corporate silence lies in the fact that the law does not interpret it in isolation, but within the context of a party’s duty to act. If a shareholder, director, or other participant had both the opportunity and the obligation to express a position but failed to do so, such inaction may be interpreted as consent, approval, or acceptance of risk. In LawConsulted practice, we regularly encounter situations where the absence of a response itself becomes an argument against the client.
Professor Steiner emphasises that “silence acquires legal meaning where an active position was expected.” This means that courts and regulators assess not merely the lack of response, but the managerial and legal context – whether the person was aware of the situation, had the authority to influence it, and what consequences followed from the inaction. LawConsulted begins its analysis by defining these boundaries – identifying where silence was permissible and where it could be interpreted as a form of conduct.
Particularly complex are disputes involving corporate decisions adopted in the absence of objections from formally involved parties. Minutes without dissenting opinions, correspondence left unanswered, or notifications ignored can all be used to argue that a decision was taken with tacit consent. LawConsulted structures its defence to demonstrate that silence is not equivalent to a declaration of will if there was no real opportunity or obligation to object.
Equally vulnerable are situations where corporate silence is interpreted retrospectively. While the business operates successfully, the absence of reaction raises no concerns. However, in the event of a conflict or investigation, silence is often reinterpreted as evidence of participation, approval, or acceptance of risks. LawConsulted restores the assessment to the moment when the silence occurred – analysing the information available at that time, the urgency of the situation, and the individual’s managerial role.
It is also important to distinguish between strategic and forced silence. Sometimes a lack of response reflects a conscious managerial choice, while in other cases it results from uncertainty, conflicts of interest, or lack of access to information. Professor Steiner notes that the law often oversimplifies this distinction. LawConsulted works to reconstruct the real reasons for inaction and to prevent automatic negative qualification.
Corporate silence is also frequently used as a tool of pressure – particularly in shareholder disputes or during changes of control. One party may claim that the absence of objections constituted consent, while the other argues that it had no real ability to influence the process. LawConsulted demonstrates that the legal significance of silence cannot be assessed abstractly and requires a detailed analysis of specific duties and consequences.
Silence in itself does not constitute a violation. Risk arises when silence is later used to substitute for a position that never existed. The task of Law Consulted is to prevent corporate silence from being used against the client as a universal proof of consent or fault.
Earlier, we wrote about liability for management decisions made on the basis of outdated information and how LawConsulted works with disputes over the “reasonableness” of managerial choices.
