The Criminal Liabilities of Directors to the Creditors of the Company: Section 458 Companies Act 1985

Abstract

The directors of a company owe certain duties to the company itself as a legal entity distinct from its members. They also owe duties to its shareholders in prescribed circumstances, and to a lesser degree to the company's creditors. This paper, inter alia, examines the circumstances in which breach of the duties owed by the directors of the company to its creditors may give rise to criminal responsibility. Central to this analysis is an exposition of the concept of fraud and its associated concept of dishonesty generally and an analysis of the interpretation by the courts of the nature and ambit of s. 458 of the Companies Act. Finally consideration will be given as to how this offence may be affected by the proposals of the Law Commission in its Consultation Paper No. 155 as to the future role of fraud and dishonesty in offences.

Citation

Scanlan, G. (2002), "The Criminal Liabilities of Directors to the Creditors of the Company: Section 458 Companies Act 1985", Journal of Financial Crime, Vol. 9 No. 4, pp. 360-371. https://doi.org/10.1108/eb026036