
What is the liability of a director who pays debts while his company is insolvent? Helen Mulcahy & Davina Bentley report
Background
HLC carried on business in the waste recycling sector. In 1998, HLC became the preferred bidder to build recycling and energy centres in the UK. Two related companies, HLC Wrexham and HLC NPT, were set up and HLC was the holding company. By September 2005, administrators were appointed to HLC NPT and the HLC Wrexham project could not be completed.
Carvalho claimed that in 2008, HLC was still trading but the court in Hellard & Ors (Liquidators of HLC Environment Projects Ltd) v