Liquidators And Liability Caps: The Core VCT Litigation

Key points

• Can liquidators in members' voluntary liquidations limit their liability through contractual terms? This seemingly straightforward question conceals layers of complexity about the nature of insolvency appointments, statutory duties, and the boundaries of contractual freedom.
• In Core VCT plc (in liquidation) v Fry and Mather [2025] EWHC 2316 (Ch), Mr Justice Thompsell grappled with this issue in a preliminary ruling. Analysing the issue through the lens of the statutory scheme that arises in liquidation, the judge held that the appointment as liquidator brings responsibilities that cannot be limited by prior contractual arrangement.
• An outstanding question regarding the applicability of the Unfair Contract Terms Act 1977 was expressly reserved for future determination. That question, together with the scope of a liquidator's firm's liability, including vicarious liability in this context, will require resolution as the substantive litigation in this