The liquidators of a company successfully applied to join the insurers of the directors of an insolvent company to court proceedings.

In Issue

As part of a claim against a company’s directors for insolvent trading, it became apparent that should the directors be found liable, they would be unable to pay the damages sought, and would become bankrupt. The liquidator brought an interlocutory application to join the company’s insurers that provided management liability cover in the relevant period, pursuant to of s117 of the Bankruptcy Act 1966 (Cth).