Commonwealth Consolidated Acts

[Index] [Table] [Search] [Search this Act] [Notes] [Noteup] [Previous] [Next] [Download] [Help]

CORPORATIONS ACT 2001 - SECT 588M

Recovery of compensation for loss resulting from insolvent trading

             (1)  This section applies where:

                     (a)  a person (in this section called the director ) has contravened subsection 588G(2) or (3) in relation to the incurring of a debt by a company; and

                     (b)  the person (in this section called the creditor ) to whom the debt is owed has suffered loss or damage in relation to the debt because of the company's insolvency; and

                     (c)  the debt was wholly or partly unsecured when the loss or damage was suffered; and

                     (d)  the company is being wound up;

whether or not:

                     (e)  the director has been convicted of an offence in relation to the contravention; or

                      (f)  a civil penalty order has been made against the director in relation to the contravention.

             (2)  The company's liquidator may recover from the director, as a debt due to the company, an amount equal to the amount of the loss or damage.

             (3)  The creditor may, as provided in Subdivision B but not otherwise, recover from the director, as a debt due to the creditor, an amount equal to the amount of the loss or damage.

             (4)  Proceedings under this section may only be begun within 6 years after the beginning of the winding up.



AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback