A company’s voluntary liquidator is the company’s agent and no action lies against for delay him save in the case of misfeasance or wilful misconduct. He is not a trustee for the creditors or contributories of a company in liquidation. Nor does he have liability as a trustee dealing with his cestui que trust. Without proof of misfeasance or wilful misconduct no action will lie against him for a delay in distributing the assets of the company. Romer J said: ‘In my view a voluntary liquidator is more rightly described as the agent of the company – an agent who has no doubt cast upon him by statute or otherwise special duties . . If this be the true position of a liquidator, and I think at any rate agency more nearly defines his true position than trusteeship, it is clear that he could not as agent be sued by a third party for negligence apart from misfeasance or personal misconduct.’
Judges:
Romer J
Citations:
[1891] 1 Ch 717, [1891] 60 LJ Ch 284, [1891] 64 LT 135, [1891] WR 523, [1891] 7 TLR 306
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 . .
Distinguished – Pulsford v Devenish ChD 1903
The liquidator in a voluntary liquidation negligently failed to inform the company’s creditors of the liquidation, and distributed the company’s assets to its contributories without regard to the creditors’ claims. The company was later dissolved. . .
Lists of cited by and citing cases may be incomplete.
Insolvency, Professional Negligence, Company
Updated: 12 May 2022; Ref: scu.190145