||All England Reporter
|| All ER (D) 161 (May)
|| EWCA Civ 544
||Court of Appeal, Civil Division
Chadwick, Sedley and Arden LJJ
||Jane Giret QC and Stephen Tudway (instructed by Sprecher Grier Halberstam) for the company.
||Stephen Robins (pro bono) for the defendants.
||11 May 2006
Company - Insolvency - Insolvent liquidation - Dividends - Sole directors and shareholders causing company to pay dividends - No retained realised profits for years in which dividends paid - Company seeking repayment of dividends - Whether shareholders liable to repay dividends - Extent of knowledge required on shareholder's part - , s 277(1) - Council Directive (EEC) 77/91, art 15, 16.
Section277(1) of the had to be interpreted as meaning that the shareholder could not claim that he was not liable to return a distribution because he did not know of the restrictions in the Act on the making of distributions. He would be liable if he knew or ought reasonably to have known of the facts which meant that the distribution contravened the requirements of the Act.
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