Liquidation of Corporate Trustees.
It is well reported that New Zealanders are keen establishers of trusts. Thanks to trusts, property owners are able to create comfort that if they ever fail, they will be able to retain the benefit of their property.
A trust is not a separate legal entity, as such the trustees are generally personally liable. That is unless they limit their liability, however, this is usually reserved for “independent” trustees.
As a result, it has become popular to appoint companies as trustees. This way the individuals who are the governing mind of the trust are able to place another layer of protection to their personal liability.
If a corporate trustees incur a debt, often it is personally liable for the debt.
There are many interesting aspects to liquidating a corporate trustee.
It is important for creditors to take these issues account as part of considering taking action.
For a full analysis of and relevant considerations for creditors, we refer you to the article by Norling Law: Liquidation of Corporate Trustees