Testing the limits of limited liability

UK courts are increasingly unwilling to allow the legal medium of the company to be used as a block to tracing and restoring the proceeds of commercial wrongdoing.

Joanna Gray • Solicitor and senior lecturer, School of Law, University of Northumbria

Appropriately enough it fell to the Vice Chancellor, Sir Andrew Morritt V-C, to provide, earlier this year, a neat illustration of how the doctrines of company law can work with established civil remedies provided by that body of Chancery law known as Equity to give them an even longer reach, and therefore effectiveness, than might a first seem apparent. (The decision of the Chancery Division in Trustor AB v Smallbone and others (No 2) is reported at [2001] 1 Weekly Law Reports.)