Companies Act 2014 section 271

Presumption that default permitted and certain defence

Section 271 establishes a legal presumption that a company officer permitted a default to occur if they were aware of the basic facts, and sets out the defence available to officers to rebut that presumption.

• Where it is proved that a company officer knew the basic facts about a default, the law presumes that the officer permitted it to happen.
• An officer can rebut this presumption by showing they took all reasonable steps to prevent the default, or were unable to prevent it due to circumstances beyond their control.
• The section defines key terms including "basic facts concerning the default," "permitted," "relevant proceedings," and "defendant" for the purposes of officer-in-default provisions.
• A defendant in these proceedings means any person (other than the company itself) who was an officer of the company at the relevant time and is alleged to be in default.