Two leases had been granted by the plaintiff to a company. Subsequently the company determined the leases but it had previously assigned the leases to a third party. The company went into liquidation and the liquidator distributed its assets. He failed to provide for future rent due to the plaintiffs under the leases. No notice of the voluntary liquidation was given to creditors. The company was subsequently dissolved. The plaintiffs were unaware of the liquidation or of the subsequent dissolution.
Held: The liquidator was liable in damages to creditors for breach of statutory duty. The liability under those two leases were liabilities which ought to have been admitted to proof by the liquidator. (Affirmed on appeal) Lord Harworth MR said: ‘The cases that we have looked at are sufficient to show that if a creditor has been injured by the failure of the liquidator to take the steps that he ought to have taken, and has suffered damage, he can ‘succeed on an action on the case’ . . in establishing a liability against a liquidator.’
Judges:
Bennett J, Lord Harworth MR
Citations:
[1936] Ch 216
Jurisdiction:
England and Wales
Cited by:
Cited – Oldham and others v Georgina Kyrris and Another CA 4-Nov-2003
The claimant sought to bring a claim against the administrators of a partnership alleging a duty of care to creditors.
Held: Such an administrator owed no greater duty to creditors than would a director. That duty was no different whether the . .
Cited – A and J Fabrications (Batley) Ltd v Grant Thornton and Others ChD 1998
The plaintiffs, the majority creditors of a company in liquidation, alleged that they had agreed with Grant Thornton, the defendants, to support the appointment of one of the firm’s partners or employees as liquidator of the company, with a view to . .
Lists of cited by and citing cases may be incomplete.
Insolvency, Negligence
Updated: 12 May 2022; Ref: scu.190148