Article 105 - PCC to inform persons they are dealing with PCC
PCC shall prior to transacting with a person:
(A) inform any person with whom it transacts that it is a
(B) for the purposes of that transaction, identify or specify the
Cell in respect of which that person is transacting, unless that transaction is not a transaction in respect of a particular Cell.
(2) If, in contravention of Article 105(1), a
(A) fails to inform a person that he is transacting with a
PCC, and that person is otherwise unaware that, and has no reasonable grounds to believe that, he is transacting with a PCC; or
(B) fails to identify or specify the
Cell in respect of which a person is transacting, and that person is otherwise unaware of, and has no reasonable basis of knowing, which Cell he is transacting with;
then, in either such case:
(C) the directors shall (notwithstanding any provision to the contrary in the
PCC's articles of association or in any contract with the PCC or otherwise) incur personal liability to that person in respect of the transaction; and
(D) the directors shall have a right of indemnity against the
Non-Cellular Assets of the PCC, unless they were fraudulent, reckless or negligent, or acted in bad faith.
(3) Notwithstanding the provisions of Article 105(2)(1), the
QFC Civil and Commercial Court may relieve a director of all or part of his personal liability thereunder if he satisfies the QFC Civil and Commercial Court that he ought to be so relieved because:
(A) he was not aware of the circumstances giving rise to his liability and, in being not aware, he was neither fraudulent, reckless or negligent, nor acted in bad faith; or
(B) he expressly objected, and exercised such rights as he had as a director, whether by way of voting power or otherwise, so as to try to prevent the circumstances giving rise to his liability.
(4) Where, pursuant to the provisions of Article 105(3), the
QFC Civil and Commercial Court relieves a director of all or part of his personal liability under Article 105(2)(C), the QFC Civil and Commercial Court may order that the liability in question shall instead be met first by any other director or directors whose personal liability is not relieved and thereafter, if necessary, from such of the Cellular or Non-Cellular Assets of the PCC as may be specified in the order.
(5) Any provision in the articles of association of a
PCC, and any other contractual provision under which the PCC may be liable, which purports to indemnify directors in respect of conduct which would otherwise disentitle them to an indemnity against Non-Cellular Assets by virtue of Article 105(2)(D), shall be void.
|Amended by QFCA RM2012-1 (as from 11th April 2012)|