A landmark Supreme Court judgement may mean that claims against company directors where they have received assets in breach of trust (even if they are not received directly into their names) may no longer be subject to the standard six year limitation period.
The decision in Burnden Holdings (UK) Ltd v Fielding & ors  UKSC 14 related to the transfer of a subsidiary of Burnden Holdings, Vital, into a new holding company that the defendants were shareholders in, which was then sold for £6 million. The defendants then used the proceeds to purchase a property.
After Burnden went into administration in October 2008 and was liquidated in December 2009, the liquidator made a claim against the directors alleging that the transfer and sale were unlawful and breached their fiduciary duties to the company.
The claim under the Limitation Act 1980 was made six years and three days after the transfer took place. The defendants consequently sought a summary judgement on a limitation defence.
The Supreme Court considered the role of an intervening holding company in the case, before unanimously finding in favour of the claimant.
The decision means that there is no limitation period where a director has wrongfully received company money for his or her own use.
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