COMPANIES ACT - 1963 (ACT 179)

    Section - 210 - Legal Proceedings to Enforce Liabilities

    (1) Proceedings to enforce the liabilities referred to in the immediately preceding section or to restrain a threatened breach of any duty under sections 203 to 205 of this Code or to recover from any director of the company any property of the company may be instituted by the company or by any member of the company.

    (2) Proceedings may be instituted by the company on the authority of the board of directors or of any receiver and manager or liquidator of the company, or of an ordinary resolution of the company which shall either have been agreed to by all the members of the company entitled to attend and vote at a general meeting or have been passed at a general meeting.

    (3) At such general meeting neither the proposed defendants nor the holders of any shares in which they or any of them are beneficially interested shall vote on such resolution and if they do vote their votes shall not be counted.

    (4) After an investigation of the affairs of the company, proceedings may, pursuant to section 225 of this Code, also be instituted in the name of the company by the Registrar.

    (5) Where proceedings are instituted by a member he shall sue in a representative capacity on behalf of himself and all other members, except any that are defendants to the action, and shall join the company as a defendant; and to any such representative action the provisions of section 324 of this Code shall apply.

    (6) The Court, on the application of any defendant, may stay proceedings by such member if satisfied that, in all the circumstances, including his participation in the transaction complained of and the circumstances in which he became a member, it is inequitable that he should be allowed to have the conduct of the action, and may, if it shall think fit order such member to give security for payment of the costs of the defendants and may direct that the action or any part of it shall be heard in chambers.

    (7) No period of limitation shall apply to any proceedings under this section, but in any such proceedings the Court may relieve a director from liability in whole or in part and on such terms as it thinks fit if, in all the circumstances including lapse of time, the Court thinks it equitable so to do.

    (8) In any proceedings under this section the Court shall have power when justice so requires, to order that any sum found to be payable by any defendant shall be restored, in whole or in part, to members or former members of the company instead of to the company itself; and in that event the Court may order that the necessary enquiries shall be made to ascertain the identity of the members and former members concerned and may give such consequential directions as may be necessary or expedient.

    (9) No proceedings under this section shall be dismissed, settled or compromised without the approval of the Court after notice of the proposed dismissal, settlement or compromise has been given to all members of the company and to the Registrar in such manner as the Court directs.

    (10) Within the time prescribed by such notice any member of the company and the Registrar may appear and call the attention of the Court to any matters which seem relevant and may give evidence and call witnesses.

    (11) If the Court shall not approve the dismissal or compromise it may give the conduct of the action to any member willing to continue the same, or to the Registrar in the name of the company, making such consequential orders regarding the parties to the action or otherwise as may be necessary or expedient.