Case Analysis – A Director’s Duty to Account

Bridget Williamson provides a case analysis for LexisNexis

A Director’s Duty to Account

The Official Receiver (as liquidator of WIFIME Ltd (in liquidation)) and another company v Haq and another [2025] EWHC 485 (Ch)

Article summary

Restructuring & Insolvency analysis: The court held a director liable to account for various sums taken out of the company in the years preceding its compulsory liquidation. Given the absence of financial records and of evidence supporting the director’s explanation for the withdrawal of the funds, the court was entitled to infer that they had not been applied for a proper purpose. As to the director’s explanation that some of the payments represented remuneration, the court held that he was not entitled to rely on the Duomatic principle for the purpose of approving remuneration, as two of the bars to the application of the principle applied.

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