Section 53: Personal liability in event of insolvency

53. Personal liability in event of insolvency (1) In any case where— (a) a limited liability partnership has been dissolved and is unable to pay its debts; and (b) there has been in relation to the limited liability partnership a contravention of this Act which— (i) has contributed to the inability of the partnership to pay its debts; (ii) has materially misled or deceived any partner or creditor as to, or has resulted in substantial uncertainty as to, the assets, liabilities, client money or investment instruments of the limited liability partnership; or (iii) has substantially impeded the winding up of the limited liability partnership, the Court may, on the application of any creditor or former partner or of any person conducting the winding up of the limited liability partnership, declare L15A1 – 29 [Issue 9] Limited Liability Partnerships Act that any partner or former partner or any manager or former manager in the partnership who is responsible for the contravention to be personally liable, without limitation of liability, for the debts of the limited liability partnership or part of such debts, as may be specified by the Court. (2) Where the Court makes an order under subsection (1) in relation to any person, it may— (a) give such directions as it considers appropriate for the purpose of giving effect to the order; and (b) direct that the liability of that person under the order shall be a charge on— (i) any debt due from the limited liability partnership to him, to any person on his behalf, to any person claiming as assignee from or through him or to any person acting on behalf of such an assignee; or (ii) any charge on any property of the partnership or any interest in any such charge held by or vested in him or any such person, and the Court may also, from time to time, make such other order as it considers appropriate for the purpose of giving effect to any charge imposed under this subsection. (3) In subsection (2)— “assignee”— (a) includes any person to whom or in whose favour, by the direction of the person liable, the debt, charge or interest was created, issued or transferred; but (b) does not include an assignee for valuable consideration, other than consideration by way of marriage, given in good faith and without notice of any of the grounds on which the order might have been made. (4) The Court shall not make an order under subsection (1) in respect of a person where it considers that— (a) he took all reasonable steps to secure compliance by the limited liability partnership with this Act; or (b) he had reasonable grounds for believing and did believe that a competent and reliable person— (i) was charged with the duty of ensuring that the provisions of this Act have been complied with; and (ii) was in a position to discharge that duty. (5) Subsections (1), (2) and (4) shall be without prejudice to any other penalty, remedy or proceedings, whether civil, criminal or disciplinary, in respect of the contravention. [Issue 9] L15A1 – 30 Revised Laws of Mauritius (6) For the purpose of this section, a person shall be considered to be responsible for a contravention of a relevant provision where the contravention— (a) was committed with his consent or participation; or (b) was attributable to, or facilitated by, any neglect on his part.