Written by Shane
Created: 12 November 2013
Can a director of a company who has not signed a personal guarantee be liable for a company’s debts?
The answer is YES!
The notion of limited liability applies to a persons shareholding. A director owes various duties to the company and ultimately the creditors of the company.
If a director allows a business to be carried out in such a way as to create a substantial risk of serious loss to creditors, the director can be sued for the resulting loss.
Whether you are a large company or a small one, the risks are the same. Get your corporate governance right.
This is not legal advice. Do not act upon anything contained in this article without seeking independent legal advice.