SITUATING THE CHALLENGE TO ADMINISTRATOR'S CONDUCT IN SALVAGING AILING COMPANY

Abstract

Administration is geared towards rescuing the company or achieving a better realization of its assets for creditors, this process must be conducted with scrupulous regard for fairness and accountability. This article interrogates the legal contours surrounding the liability of an administrator in the administration of an ailing company. Contrary to any presumption of immunity, an administrator is not shielded from legal consequences arising from the exercise or abuse of his statutory powers. The study is aimed at situating the challenge to administrator's conduct in salvaging ailing company. It employs doctrinal methodology anchored on analyses of the statutory framework and judicial precedents which empower any aggrieved creditor or member whether individually or collectively to challenge the conduct of an administrator where such conduct is deemed unfairly prejudicial to their interests. It was found that liability may arise irrespective of whether the harm is personal to the applicant or shared with other stakeholders within the surrounding guise of administrator's immunity. The article recommends that the Companies and Allied Matters Act 2020 be amended with a provision situating this liability within the broader context of fiduciary responsibility, statutory duty, and equitable intervention. This will ultimately advancee the argument that while administration is a tool of corporate rescue, it cannot be a cloak for procedural injustice or mismanagement.