Document ID: chunk:federal_register_of_legislation:C2005A00138:clause:1_1
Version: federal_register_of_legislation:C2005A00138
Segment Type: clause
Provision Reference: sch 1 cl 1
Character Range: 2477–3476

1  Subsection 197(1)
Repeal the subsection, substitute:

 (1) A person who is a director of a corporation when it incurs a liability while acting, or purporting to act, as trustee, is liable to discharge the whole or a part of the liability if the corporation:
 (a) has not discharged, and cannot discharge, the liability or that part of it; and
 (b) is not entitled to be fully indemnified against the liability out of trust assets solely because of one or more of the following:
 (i) a breach of trust by the corporation;
 (ii) the corporation's acting outside the scope of its powers as trustee;
 (iii) a term of the trust denying, or limiting, the corporation's right to be indemnified against the liability.
The person is liable both individually and jointly with the corporation and anyone else who is liable under this subsection.

Note: The person will not be liable under this subsection merely because there are insufficient trust assets out of which the corporation can be indemnified.