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VIC Piercing the Company - What is the Limit?

Discussion in 'Debt and Bankruptcy Law Forum' started by AIUH, 30 June 2015.

  1. AIUH

    AIUH Member

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    One of the case is that the company directors malicious default of employees' entitlements, ATO tax and creditors' money, and he always use assets such as vehicle and mobile phones for personal purposes, which may be sufficient for the employee to unveil the company.

    The director has several houses which are co-owned by both him and his spouse, and the employees are not quite sure if they have prenuptial agreement or property agreement within marriage. So, what's the limit for this
    piercing the company veil for the following scenarios (especially when the liability incurred ):

    (1) If the couple have clear separation of their assets?

    (2) If they don't, can the creditors and employees take advantage of his spouse's money?
     
  2. DennisD

    DennisD Well-Known Member

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    Hi there

    From general principles, if the director's spouse legally holds most of their assets in her/his (the spouse's) name, it would be even more difficult to access these, supposing first that a court may find the director personally liable.
     
    Tim W likes this.
  3. Tim W

    Tim W Lawyer

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    I agree with @Hugh .
    I would add however that if the transfer of assets to the spouse took place in the context of insolvency or approaching (even suspected) insolvency, then it can be possible to (as they say) "claw back" those assets.

    Is the employer here engaged in a thing called "phonexing"?
     
    DennisD likes this.

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