Charity insolvency—personal liability of charity trustees
Produced in partnership with Rebecca Walker of Lester Aldridge LLP
Charity insolvency—personal liability of charity trustees

The following Restructuring & Insolvency practice note produced in partnership with Rebecca Walker of Lester Aldridge LLP provides comprehensive and up to date legal information covering:

  • Charity insolvency—personal liability of charity trustees
  • Breach of duty
  • Wrongful and fraudulent trading (incorporated charities only)
  • Personal liability under contracts (unincorporated charities only)
  • Practical tips for limiting liability

STOP PRESS: The Corporate Insolvency and Governance Act 2020 (CIGA 2020) received Royal Assent on 25 June 2020. CIGA 2020 makes significant changes to insolvency law, including temporary changes to the wrongful trading regime. These provisions were originally back-dated to 1 March 2020 and ended on 30 September 2020. For further information, see Practice Note: Corporate Insolvency and Governance Act 2020—temporary changes to the wrongful trading regime. The temporary changes have since been revived from 26 November 2020 until 30 June 2021. For the purposes of determining any compensation payable with regards wrongful trading, the court is to assume that the director is not responsible for any worsening of the financial position of the company or its creditors that occurred during that period.

The CIGA 2020 legislates to temporarily prevent winding up proceedings being taken on the basis of unsatisfied statutory demands and to temporarily stop winding-up proceedings where coronavirus has had a financial effect on the company which has caused the grounds for the proceedings. The CIGA 2020 provides that a winding-up petition based on section 123(1)(a) of the Insolvency Act 1986 (IA 1986) (ie an unsatisfied statutory demand in respect of a debt exceeding £750) that relates to a statutory demand served on or after 1 March 2020 cannot be presented by a creditor during the period beginning on 27 April 2020

Popular documents