Loans Etc. Between Directors and Company

Part 5 – Duties of Directors and Other Officers

Two new rebuttable presumption provisions

There is a rebuttable presumption that loans to directors by the company, the terms of which are not in writing, are repayable on demand. This is new. The rule includes quasi-loans. (Section 236).

The opposite of this is true. If a director – or a connected person – claims they made a loan or a quasi-loan in favour of the company, and the terms are not in writing, (or if they are, the writing is ambiguous), the rebuttable presumption that no loan or quasi-loan was ever made, stands in favour of the company. (Section 237). This, too, is new.