n SA Mercantile Law Journal = SA Tydskrif vir Handelsreg - Die aanspreeklikheid van 'n insolvente maatskappy en die likwidateur van 'n insolvente maatskappy vir vergoeding as gevolg van omgewingsbenadeling

Volume 24, Issue 3
  • ISSN : 1015-0099
  • E-ISSN: 1996-2185



With regard to environmental harm by an insolvent company, the concern with the liquidator of the insolvent company is usually the extent to which he or she shall personally be held liable for environmental harm caused while operating the business of the company in performing the duty to liquidate the business properly. It is necessary to distinguish between damage that occurred prior to the winding-up by the harmful activity itself and damage that occurred during the winding-up. Damage during liquidation could again result from activities prior to liquidation or damage flowing from the activities of the liquidator while operating the business of the insolvent company with a view to the proper liquidation and settlement of the business and affairs of the company. The liability for damages by the harmful activity itself should also be distinguished from the reimbursement or payment of costs under the liability to take certain steps such as cleaning up, remediation, prevention and limiting of any environmental damage. Again, it can be a failure by the company before the liquidation or a failure by the liquidator after the liquidation. It is submitted that the liability of the liquidator will probably depend on the degree of skill that the courts believe will reasonably be expected from the liquidator. The answer lies in the liquidator's duty of care. It is possible that, unlike the trend in English law, the courts will not expect the same level of skill or knowledge as expected from company management. The liquidator will not be held liable unless the harm resulting from an act or an omission is unreasonable, even for a liquidator. However, in each case the courts will require appropriate management skills. It is therefore recommended that the liquidator ensures that he or she has adequate 'tools' in place for performing environmental obligations, with duties delegated to appropriate persons.

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