Recent amendment to section 197- is it acceptable?

The majority decided in Hanel v O’Neill that directors of trustee companies<br />could be held personally liable to discharge the debts incurred by a<br />company pursuant to s 197(1) of the Corporations Act 2001 (Cth). On<br />18 November 2005, legislation was passed to amend s 197(1); this was to<br />overturn the decision. This article evaluates other relevant cases and<br />argues that the recent amendment to s 197 is unsatisfactory as it leaves<br />potential for abuse by directors of certain trustee companies. The article<br />suggests further reform to the section and to this end, suggests ways for<br />s 197 to reconcile with other parts of corporate law, such as insolvent<br />trading and directors’ duties.<br />