Re Augustus Barnett & Son Ltd [1986] BCLC 170 is a UK insolvency law case on the standard of fault required to show that directors have been guilty of fraudulent trading.

Barnett had a deficiency of assets, and its auditors would not certify accounts on a going concern basis, unless Rumasa confirmed it would keep supporting the company.

Rumasa opposed and argued there was no reasonable cause of action, because it was never alleged that Barnett directors were dishonest or had any intention to defraud.

This was that the Rumasa's letter of comfort, for financial support over the years, should make the parent liable for Barnett's debts.

He said the state of law was inadequate on this subject, and it was a question of considerable public importance; but these interlocutory proceedings were not a good opportunity for a wider investigation.