When the Insolvency Act 1986 became the principal law applicable to corporate insolvency in April 1986, there was much discussion around section 214, because it introduced the concept of wrongful trading in the form of personal liability falling upon a director in respect of certain unpaid company debts in the event of the liquidation.
Previously, directors had operated on the basis that company liabilities were not a personal problem if they were unpaid, with the exception of those for which either a personal guarantee had been issued or personal assets pledged.
Following the introduction of the 1986 legislation, there were some well publicised cases, like Produce Marketing Consortium, which attempted to clarify wrongful trading so th…
Read the full article at: https://www.insider.co.uk/news/wrongful-trading-back-should-you-24683606
