TerrywParticipant@terrywJoin Date: 2001Post Count: 16,190
Are Directors of Corporate Trustees automatically liable for a trustee’s debts?
Read an online article from Cleardocs here:
Here is a quote:
The liability of directors will only extend to where the corporate trustee is not entitled to be fully indemnified out of trust assets solely because of:
â€¢ a breach of trust by the corporation; or
â€¢ the corporation acting outside the scope of its powers as trustee; or
â€¢ a term of the trust denying, or limiting, the trustees right to be indemnified against the liability.
Directors of corporate trustees can now be sure that they will not effectively be deemed to be guarantors for the corporate trustee unless any of the three criteria above exist. (See new Section 197 of the Corporations Act, amended in November 2005.)
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