Not My Brother’s Keeper – A Brief Guide to Inactive Directors’ Liabilities IT Protect Ltd (In Liquidation) [2020] EWHC 2473 (Ch)


Publication Date:
01 Oct 2020


Description:

This article examines issues raised by the recent decision in IT Protect Ltd (In Liquidation) and considers the challenges posed when seeking to impose liability upon wholly inactive directors. ?

Directors are, prima facie, jointly and severally liable for wrongs in which they are sufficiently involved. Those claiming damages or associated remedies can elect which director to pursue for satisfaction of any remedy granted. However, this is subject to the significant caveat that a director is not liable for the sins of their co-director solely by reason of their office, a claimant must plead and prove a sufficient basis in law for joint liability. ?

This gives rise to a range of difficulties, chief amongst which is how to fix a wholly disengaged director with liability. The point is particularly acute if the prospects of recovery and worthwhile execution differs significantly between directors. ?

 

To read the full article, please click here.

Contributors:


© New Square Chambers Ltd : Barristers regulated by the Bar Standards Board.