Directorship less attractive; final consumer dollop & pains in the neck
DIRECTORS BEWARE
Insolvency law changes which came into force on 1 October 2015 can be found where you would least expect them—in the Small Business, Enterprise and Employment Act 2015 with ss 104 to 106 and 108 to 110 (among others) activated by commencement order SI 2015/1689. The court is given a new power to order compensation in favour of a creditor who has been caused loss due to the conduct of a person for which, following a company’s insolvency (liquidation, administration or administrative receivership will do) they have been disqualified or given an undertaking under the Company Directors Disqualification Act 1986. Proceedings may be avoided or compromised if the person undertakes to pay the compensation. To be taken into account are the amount of the loss, the nature of the conduct and whether any other financial contribution has been made in recompense for the conduct. It is the secretary of state who must take the initiative to go after the compensation and he has two years from disqualification or undertaking to bring
