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Recent amendment to section 197- is it acceptable?

journal contribution
posted on 2006-01-01, 00:00 authored by Lang Thai
The majority decided in Hanel v O’Neill that directors of trustee companies
could be held personally liable to discharge the debts incurred by a
company pursuant to s 197(1) of the Corporations Act 2001 (Cth). On
18 November 2005, legislation was passed to amend s 197(1); this was to
overturn the decision. This article evaluates other relevant cases and
argues that the recent amendment to s 197 is unsatisfactory as it leaves
potential for abuse by directors of certain trustee companies. The article
suggests further reform to the section and to this end, suggests ways for
s 197 to reconcile with other parts of corporate law, such as insolvent
trading and directors’ duties.

History

Journal

Insolvency law journal

Volume

14

Issue

1

Pagination

22 - 36

Publisher

Lawbook Co

Location

North Ryde, N.S.W

ISSN

1039-3293

Language

eng

Publication classification

C1 Refereed article in a scholarly journal

Copyright notice

2006, Lawbook co.

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