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Financial Markets Conduct Act 2013

Disclosure of offers of financial products - Procedure for making regulated offers - Dealing with applications where condition referred to in PDS not met or disclosure defective

81: Director not liable if no misconduct or negligence

You could also call this:

"Directors are not in trouble if things go wrong by accident, not because they did something wrong."

Illustration for Financial Markets Conduct Act 2013

If you are a director, you are not liable under section 80(3) if you can prove that something went wrong with repaying money and it was not because of anything wrong you did or because you were careless. You have to show that the problem was not due to any misconduct or negligence on your part. If you can do this, you will not be liable, as stated in section 80(3).

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM4702192.

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Part 3Disclosure of offers of financial products
Procedure for making regulated offers: Dealing with applications where condition referred to in PDS not met or disclosure defective

81Director not liable if no misconduct or negligence

  1. A director is not liable under section 80(3) if he or she proves that the default in the repayment of the money was not due to any misconduct or negligence on his or her part.