THE CORPORATIONS LAW

CHAPTER 5 - EXTERNAL ADMINISTRATION

PART 5.7B - RECOVERING PROPERTY OR COMPENSATION FOR THE BENEFIT OF CREDITORS OF INSOLVENT COMPANY

Division 4 - Director liable to compensate company

Subdivision B - Proceedings by creditor

SECTION 588T   WHEN CREDITOR MAY SUE FOR COMPENSATION WITHOUT LIQUIDATOR'S CONSENT  

588T(1)  [Notice given to liquidator]  

This section applies where a notice is given under section 588S.

588T(2)  [Liquidator withholds consent]  

The creditor may begin proceedings in a court under section 588M in relation to the incurring by the company of the debt specified in the notice if:

(a)  as at the end of 3 months after the liquidator receives the notice, he or she has not consented to the creditor beginning such proceedings; and

(b)  on an application made after those 3 months, the court has given leave for the proceedings to begin.

588T(3)  [Liquidator supplies reasons]  

If:

(a)  during those 3 months, the liquidator gives to the creditor a written statement of the reasons why the liquidator thinks that such proceedings should not be begun; and

(b)  the creditor applies for leave under paragraph (2)(b);

then:

(c)  the creditor must file the statement with the court when so applying; and

(d)  in determining the application, the court is to have regard to the reasons set out in the statement.