What happens when a liquidator considers that the director of a company is unfit for this role?
Directors of an insolvent company are subject to a report by the liquidator to the DTI. If the DTI considers that the director’s conduct merits disqualification, proceedings can be brought against the director under the Company Directors Disqualification Act 1986. The period of disqualification can range from two to fifteen years.
The procedure often starts with a request by the liquidator to the director / officer to complete a questionnaire regarding his dealings with the company. Early advice should be taken if such a request is made.
There is an opportunity for the director to grant a voluntary disqualification undertaking and to seek permission to continue to be a director in respect of a particular company.
We have experience in acting for directors and alleged shadow directors in relation to the provision of undertakings and the defence of disqualification proceedings.
Contact
Dorothy Hatfield
Partner, Glasgow