LAWFUL DIVIDENDS CAN BE CHALLENGED AS UNDERVALUED TRANSACTIONS DEFRAUDING CREDITORS

An article from Out-Law on 6 March reported on a recent case, saying that even lawfully-paid dividends can be challenged in the courts as acts designed to deprive creditors of assets of a company, the Court of Appeal has ruled.  It said that a dividend payment that was the subject of a dispute between Sequana and BAT Industries was a ‘transaction at an undervalue’, but not in this case a breach of the directors’ duty to have regard to creditors’ interests.

https://www.out-law.com/en/articles/2019/March/lawful-dividends-can-be-challenged-as-undervalued-transactions-under-section-423-says-court/

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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