40EProtection for receiver

1. Subject to subsection (4), no proceedings lie against any receiver of a local authority, a water organisation, or Watercare for breach of section 40D(1)—

2. by the receiver; or
3. by any adviser or delegate of the receiver (being an adviser or delegate who has been reasonably selected and reasonably supervised).

4. Subject to subsection (4), no proceedings lie against any adviser or delegate of any receiver of a local authority, a water organisation, or Watercare for a breach of section 40D other than at the instance of the receiver.

5. Subject to subsection (4), a receiver (and any adviser or delegate who has been reasonably selected and reasonably supervised, as the case requires), must, in respect of any liability relating to the exercise or purported exercise or omission to exercise any right or power of the receiver by the receiver or the adviser of the receiver or the delegate of the receiver, be indemnified—

6. by the local authority, the water organisation, or Watercare, in the case of a receiver appointed by the High Court under section 40B(1):
7. out of the assets subject to receivership, in the case of any other receiver but subject to any contrary terms of appointment.

8. No person is exempted from liability under subsection (1) or is entitled to be indemnified under subsection (3) for any act or omission to act which constitutes bad faith or gross negligence on the part of that person.

9. Nothing in this section limits or affects the provisions of sections 19 and 20.