Key Points

Where a sole director and shareholder of a company had breached fiduciary duties he could not ratify the breach if the company was insolvent;

Claims against the company in liquidation by dishonest assisting parties could not be set off under rule 4.90 Insolvency Rules against any liability they had in damages for that assistance.

The Facts

The British Columbia Court of Appeal has overturned the B.C. Supreme Court decision inKBA Canada1, which was reviewed in the September 2012 issue of Fully Secured.