The Gazette 1991

i SEPTEMBER 1991

GAZETTE

pes PETROCARGO MARINE SURVEYORS LTD. Capt. Thomas C. Nash M. INST. PET. Marine Consultancy; Independent Marine Surveyors; Vessel & Terminal Safety Inspection; Recruitment; Procedures Manuals. Cooleen House, Rushbrooke, Cobh, Co. Cork. Tel: 021-811677 Fax: 021-813009 is not attempted to detail here what should be sought by a solicitor acting for a lending institution, but it would seem that the following may be included in any new requisitions: • Are Borrowings Ltd and Guarantor Ltd companies which are part of a group of companies? • Who are the shareholders, what are their holdings, and who are entitled to exercise voting rights in Borrowings Ltd? • What are their relation- Marine Expert Witness; Ship to Ship Transfer;

The penalties prescribed for commiting either of the foregoing offences are set out in S.240 of the Companies Act, 1990. Thus, on summary conviction, one is liable to a fine not exceeding £1,000 or at the discretion of the court, to im- prisonment for a term not exceed- ing 12 months, or both. On conviction on indictment, one is liable to a fine not exceeding £10,000, or at the discretion of the court, to imprisonment for a term not exceeding 3 years, or both. It must also be noted that a contravention of S.31 remains a criminal o f f ence even if the guarantee is not voidable, by virtue of the "savers" of S.38 (1) (a) and (b) applying. Their cumulative effect is merely to prevent a transaction or arrangement from being avoided - the fact remains that there has been a contravention of S.31, and so it follows that the sanctions in S.40 continue to apply. 9. When Does e Guarantee Contravene S.31? The question of whether any given guarantee contravenes S.31 is a matter to be decided by each solicitor and his client looking at the facts of each individual situation. It

8. The Criminal Consequences of Contravention Where a guarantee contravenes S.31 of the Companies Act, 1990, the officers of Guarantor Ltd may by virtue of S.40 (1) of the Act, be guilty of an offence, where they know, or have reasonable cause to believe, that the company was contravening S.31. Less clear is the offence created by S.40 (2), which provides that: "A person who procures a com- pany to enter into a transaction or arrangement knowing or having reasonable cause to believe that the company was thereby contravening section 31 shall be guilty of an offence." One question must be, can a soli- citor who acts either for the lender or the borrower be guilty of an of- ". . . can a solicitor who acts either for the lender or the bor- rower be guilty of an offence where it can be proved that he procured Guarantor Ltd to enter the transaction or arrangement?" fence where it can be proved that he procured Guarantor Ltd to enter the transaction or arrangement?

ships (lineal and marital) with the directors (includ- ing shadow directors) of Guarantor Ltd and of the

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