Insolvency Bill [Lords] — Section 309(1) of the Insolvency Act 1986 to apply to nominees — 16 Nov 2000

Brought up, and read the First time.

I beg to move, That the clause be read a Second time.

Madam Deputy Speaker (Mrs. Sylvia Heal):

With this it will be convenient to discuss the following amendments: No. 46, in schedule 1, page 15, line 6, at end insert--

The matters to which the directors of a company are to have regard in the performance of their functions include the interests of the company's employees in general . . .

If any of the company's creditors or any other person is dissatisfied by any act, omission or decision of the supervisor, he may apply to the court.

any other person affected by a moratorium

Directors to have regard to interests of employees,

Accordingly, the duty imposed by this section on the directors is owed by them to the company (and the company alone) and is enforceable in the same way as any other fiduciary duty owed to a company by its directors.

We must remember that the directors are still in charge of a company in a moratorium, and section 309 continues to apply. Therefore, they should have regard to that duty when framing a rescue plan. That is my point which, for whatever reason, my hon. Friends do not want to accept.

any adverse court judgment or disciplinary findings by any of the Recognised Supervisory Bodies.

Question put, That the clause be read a Second time:--

The House divided: Ayes 42, Noes 280.

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