Insolvency Litigation and Shadow Directors
Insolvency Litigation includes Shadow Directors as well as ‘formal’ directors.
When a company becomes insolvent, its creditors can claim back losses from the company’s directors if these directors breached their duties prior to the insolvency. This also includes what we call shadow directors, not just those who are formal directors of the company. In this way, creditors can recoup funds to meet the company’s debts from the individual directors who caused the loss of such funds.
Clarification for this issue of shadow directors’ duties and obligations came in 2013 in Vivendi SA and Centenary Holdings Ltd v Murray Richards and Stephen Bloch, where the court recognised that a shadow director’s role in a company’s affairs may be just as important as that of a director’s. Just because an individual is not officially a director does not mean they are beyond the jurisdiction of the Court.
NDP’s Insolvency Litigation Solicitors can help
We act both for and against Insolvency Practitioners, so we know what the opponent wants in insolvency litigation matters, and how best to achieved the best possible outcome for our clients, whether the matter involves an issue concerning shadow directors, or other key areas below:
– Breach of Fiduciary Duties/Misfeasance Claims
– Transactions at an undervalue
– Validation orders
– Wrongful Trading
– Bankruptcy Annulments
– The Matrimonial Home
– Illegal Dividends
– Prohibited Name Issues
If you have an Insolvency Litigation problem, contact us now for a FREE initial consultancy.