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🇮🇸 Iceland /Crime & Justice

Former CEO denied 91 million króna claim after court finds breach of trust

From Morgunblaðið · () Icelandic

Translated from Icelandic, summarized and contextualized by DistantNews.

At a glance

News Sources not specified Outcome reported
  • Jón Ingvar Pálsson, former CEO of Innheimtustofnun sveitarfélaga, was denied a claim of over 91 million Icelandic króna.
  • The court ruled that Pálsson breached trust by failing to disclose a contract with a law firm to the company's board.
  • Pálsson was dismissed in 2021 following media reports about the contract.

A court has rejected a former CEO's claim for over 91 million Icelandic króna (approximately $650,000 USD) in damages and lost earnings. Jón Ingvar Pálsson, the former head of Innheimtustofnun sveitarfélaga (the Municipal Debt Collection Agency), was dismissed in 2021 and subsequently sued the agency.

The Reykjavik District Court ruled that Pálsson breached his fundamental duties as CEO. The court found that he failed to inform the agency's board about a contract awarded to Officio ehf., a law firm associated with another agency employee, Braga Axelsson. Pálsson only disclosed the contract after media outlets began investigating the matter.

In its ruling, the court stated that Pálsson's actions constituted a breach of trust and a failure to manage the institution in accordance with its legal mandate. Given the severity of his misconduct, the court deemed his dismissal without notice to be lawful. Pálsson was also ordered to pay 1.5 million Icelandic króna in legal costs to the agency.

DistantNews Editorial

Originally published by Morgunblaðið in Icelandic. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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