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11.5
out of the Cork Committee's deliberations and it is
Where,
true to say without risk of contradiction, that none of
those taking a close interest in the Act opposed the
general principles underlying such an offence.
however, Government and others came adrift was on
questions of definition and wording. The general
but considered view of the business community was
and is that the provision is too vaguely cast. It
is not abundantly clear on the face of the
Section when, in practical terms, the proposal
would begin to bite. This is worrying, as the
Act will be used for guidance by non-lawyers
whose decisions will affect the livelihoods of
many.
Members noted that the Cork Committee in its Report laid
out the principles by which wrongful trading could be identified and
went so far as to propose a draft clause for this purpose. This
draft, however, was not followed in Section 15 of the 1985 Act. The
Cork Committee proposed that a company would be trading wrongfully if,
being insolvent or unable to pay its debts as they fall due, it
incurs liabilities to other persons without a reasonable prospect
of meeting them in full; and that a person who was party to the
carrying on of the company's trading may be made personally liable if
he knew or, as an officer, ought to have known that the trading was
wrongful. Attractive though this definition is in the context of Hong Kong,
where directors often permit their companies to continue trading long
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