Hiding Behind The Corporate Veil
In certain circumstances, directors can be held personally liable for losses of the company they control. The case of the $2.00 shelf company affording protection and limited liability are long gone.
Some of these circumstances include:
- Insolvent Trading;
- Personal Guarantees;
- Breaching directors’ duties;
- Taxation debts and superannuation contributions; and
- Phoenix activity
It is a rare insolvency where we don’t see at least a couple of these issues falling squarely in the lap of the directors. But forewarned is forearmed so let your clients know the various traps for young players to help them mitigate their risk. Feel free to share this article or even copy it and send it under your own banner.
#law #companylaw #directors #legal #businesstips #stayoutofcourt
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