Building Societies Act, 1989
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Personal liability of officers of society where proper accounting records not kept. |
112.—(1) Subject to subsection (2), if a society that is being wound up and that is unable to pay all of its debts has contravened section 76 , and the Court considers that such contravention has contributed to the society's inability to pay all of its debts or has resulted in substantial uncertainty as to the assets and liabilities of the society or has substantially impeded its orderly winding up the Court, on the application of the liquidator or the Central Bank or any creditor or contributory of the society may, if it thinks it proper to do so, declare that any one or more of the officers and former officers of the society who is or are in default shall be personally liable, without any limitation of liability, for all, or such part as may be specified by the Court, of the debts and other liabilities of the society. | |
(2) On the hearing of an application under subsection (1), the person bringing the application may himself give evidence or call witnesses. | ||
(3) (a) Where the Court makes a declaration under subsection (1), it may give such directions as it thinks proper for the purpose of giving effect to the declaration and in particular may make provision for making the liability of any such person under the declaration a charge on any debt or obligation due from the society to him, or on any mortgage or any interest in any mortgage on any assets of the society held by or vested in him or any company or other person on his behalf, or any person claiming as assignee from or through the person liable under the declaration or any company or person acting on his behalf, and may from time to time make such further order as may be necessary for the purpose of enforcing any charge imposed under this subsection. | ||
(b) In paragraph (a) “assignee” includes any person to whom or in whose favour, by the directions of the person liable, the debt, obligation or mortgage was created, issued or transferred or the interest created, but does not include an assignee for valuable consideration (not including consideration by way of marriage) given in good faith and without notice of any of the matters on the ground of which the declaration is made. | ||
(4) The Court shall not make a declaration under subsection (1) in respect of a person if it considers that— | ||
(a) he took all reasonable steps to secure compliance by the society with section 76 , or | ||
(b) he had reasonable grounds for believing and did believe that a competent and reliable person, acting under the supervision or control of a director who has been formally allocated such responsibility, was charged with the duty of ensuring that this section was complied with and was in a position to discharge that duty. | ||
(5) This section shall have effect notwithstanding that the person concerned may be criminally liable in respect of the matters on the ground of which the declaration is to be made. | ||
(6) In this section “officer”, in relation to a society, includes a person who has been convicted of an offence under section 90 or 120 in relation to a statement concerning the keeping of proper accounting records by the society. |