CAN A COMPANY’S DIRECTOR BE HELD LIABLE FOR COMPANY DEBT?
As a director of a company, you will be held liable in terms of the Company’s Act.
- As the Company’s Act permits the court to disregard the juristic personality of a company as a legal entity and thus pierce the corporate vail.
- If the court finds that any use of the company, any act by, or on behalf of the company, constitutes unconscionable abuse of the juristic personality of a company as a separate legal entity.
In this instance the court may declare that the company, to be deemed not to be a juristic person.
- Unconscionable abuse of a company can be, where the directors of the company, carried on the business in a reckless and negligent manner with the intent to defraud its creditors.
In this instance, the directors of the company can be held personally liable for debt. Burden Swart & Botha Attorneys are ready and able to see to all your legal needs in a professional manner