Section 50

If, in the course of the winding up of a registered business trust or in any proceedings against the trustee‑manager in its capacity as the trustee‑manager of the registered business trust, it appears that an officer of the trustee‑manager who was knowingly a party to the contracting of a debt on behalf of the registered business trust had, at the time the debt was contracted, no reasonable or probable ground of expectation, after taking into consideration the other liabilities of the registered business trust (if any) at the time, of the trustee‑manager being able to pay the debt from the trust property of the registered business trust, the officer shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 or to imprisonment for a term not exceeding 2 years or to both.

Where a person has been convicted of an offence under subsection (1) in relation to the contracting of such a debt mentioned in that subsection, the court, on the application of the liquidator or any creditor of the registered business trust or unitholder of the registered business trust, may declare that the person is to be personally responsible without any limitation of liability for the payment of the whole or any part of that debt.

If, in the course of the winding up of a registered business trust or in any proceedings against the trustee‑manager in its capacity as the trustee‑manager of the registered business trust, it appears that any business of the registered business trust has been carried on with intent to defraud creditors of the registered business trust or creditors of any other person or for any fraudulent purpose, the court, on the application of the liquidator or any creditor of the registered business trust or unitholder of the registered business trust, may declare that any person who was knowingly a party to the carrying on of such business of the registered business trust in that manner is to be personally responsible, without any limitation of liability, for all or any of the debts or other liabilities incurred by the trustee‑manager on behalf of the registered business trust as the court directs.

Where the court makes any declaration pursuant to subsection (2) or (3), the court may give any further directions for the purpose of giving effect to that declaration, and in particular may make provision for making the liability of any person (P) under the declaration a charge on any debt or obligation due from the trustee‑manager in its capacity as trustee‑manager of the registered business trust to P, or on any charge or any interest in any charge on any trust property of the registered business trust held by or vested in P or any corporation or person on P’s behalf, or any person claiming as assignee from or through P or any corporation or person acting on P’s behalf, and may from time to time make any further order that is necessary for the purpose of enforcing any charge imposed under this subsection.

In subsection (4), “assignee” includes any person to whom or in whose favour, by P’s directions, the debt, obligation or charge was created, issued or transferred or the interest created, but does not include an assignee for valuable consideration (not including consideration by way of marriage) given in good faith and without notice of any of the matters on the ground of which the declaration is made.

Where any business of a registered business trust is carried on with the intent or for the purpose mentioned in subsection (3), every person who was knowingly a party to the carrying on of the business with that intent or purpose shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000 or to imprisonment for a term not exceeding 7 years or to both.

Subsection (6) applies to a registered business trust whether or not it has been, or is in the course of being, wound up.

This section has effect even though the person concerned is criminally liable apart from this section in respect of the matters on the ground of which the declaration is made.

On the hearing of an application under subsection (2) or (3), the liquidator may give evidence or call witnesses.