The defendant was the sole director of a company which went into liquidation. Almost six years after his appointment as liquidator, the claimant commenced proceedings seeking an order pursuant to s 212 Insolvency Act 1986 that the defendant contribute to the company’s assets on the basis that he had acted in breach of duty of care and skill and in breach of fiduciary duty owed to the company, which had resulted in the company’s deficiencies. The defendant submitted that the claims were statute barred as the limitation period ran from the date the damage was suffered by the company, which was more than six years before the proceedings were commenced.
The court held that s 212 was merely procedural in nature providing alternative means for a company to obtain recompense from a director in breach of his duties. In substance, the claimant remained the company whether the claim was brought by the company or the liquidator. A claim under s 212 did not have a limitation period distinct from that applicable to the underlying claim. If the underlying claim if brought by the company was statute barred, as it was here, the same claim but brought by the liquidator would also be statute barred. It would be extraordinary if the result were otherwise. The claim was struck out.
In the matter of Eurocruit Europe Ltd (In Liquidation) sub nom K A Goldfarb (Liquidator of Eurocruit Europe Ltd) v Poppleton