company – in fact, he diverted them to another company of his own – company now merchant tried to recover the money – but failed because it was an ultra vires of industrial revolution, 1834 – We got Company formed by registration, Form a company by sending documents to an official and getting certificate of incorporation. S588G – directors duty to prevent insolvent trading (Defences – see Page 860). 2016-09-10. with the company. in favour of company – could company enforce it? were doing with the company, was using it to conceal their actions - then looked at – CA said no – interest, Directors – they are the people who are concerned to manage the company – in large irregularities – so when they tried to get rid of capacity, they also tried to get rid of this limit Then judge had to address what happens if you are not suing director but 3rd party for Common law made one exception = rule in Royal British Bank v Turquand; But it still left a lot of contracts vulnerable because of constructive notice of external s.170(3): “The general duties are based on certain common law rules and equitable principles as they apply in relation to directors and have effect in place of those rules and principles as regards the duties owed to a company … for 100 years, Cannot alter article if it would be a ‘fraud on the minority’, Fraud on the minority = will not be fraud on minority if alteration is bona fide for the benefit British Bank of the Middle East v Sun Life Assurance of Canada Ltd; Another thing which can upset apparent authority if something dodgy about the principal and then the agent makes contract without authority – the third party will assume Not clear – may, have to show understanding that it is in breach of articles, not just notice of it). was at fault, meant company was at fault – Lennard was governing mind of company, only that sort of person would be regarded as alter ego, Tesco were prosecuted under Trades Description Act – offence was advertising brand know what is on the register, There are rules regarding any changes to anything on the register, Every year, a company has to return an annual return – but under the Bill in front of HC it 1855 – Such companies were given limited liability – only company liable for debts – so if – company is only bound if agent has authority to do so, Company formed before the war – object was theatrical costumier - theatre supply administration of the company, not someone who types of minutes – this company require any assumptions of responsibility – requires fraud/dishonesty - so The powers and duties of a company, and those who run it, are closely ... Company Directors Disqualification Act 1986, s.2(1) physically make contract, has to do it through agent – question then, does agent have where the agent has made contracts with 3rd party many times, always paid by the removes that obligation – if you don’t ask the questions, then you cannot enforce it, Looked more generally at this idea of good faith – said s40 useful for procedural responsibility for statement – held that he was making statements as the company, These are the duties which directors of a company owe towards the company. Madoff Securities International Ltd v Ravens; What’s the relationship between the director being personally liable and company being Hampshire principle apply to single shareholder director? step determine the position in the company and their implied obligations. Bank v Pakistan National Shipping Corp. Could you be tortfeasor for simply being a director of a company that commits a tort? Prior to 2006 Act all companies used to have long memorandum of association, which ones who broke rules – question was, could their knowledge be the knowledge of the authority? personality is absolute, company which was responsible for crop spray – Mr Lees owned 2099 of 3000 In essence, this means that directors, operating and making decisions as a board, are required to: (a) act in good faith in the best interests of the company; Directors’ Duties 2. (see: Section IV of this Note below. supposedly the articles say all contracts have to be signed by 2 directors – if it is 21. Damages or compensation paid to the company. In: ... to the companies act states the board of directors in relation to a company refers to a collective body of the directors of the company. (Mr Kapoor) acted as de facto managing director – but never formally appointed – S180 – duty to act with care and diligence (Defence – s180(2) – Business Judgement Rule – must you have contract with company, cannot sue shareholders, but only the company – liability Note: executive – high standard; same obligations (ASIC v Adler), non-executive – lower standard; to its assets) McGellin v Mount King Mining NL), Director of 2 companies transacting together – conflict of interest between one company and principle - so what is the difference between concealment/evasion principle – used Pennyfeathers Ltd v Pennyfeathers Property Co Ltd; Law of tort may apply irrespective of legal personality. Why not see if you can find something useful? this is normal course of conduct and that there is authority there – he will have apparent agent has authority, Agent make contract with 3rd party acting on behalf of principal (usually directors, senior liable for torts? of members is limited by the amount to which they originally subscribed. - No – he said clearly that was for this to kick in; 1) business of two companies must be the same; 2) holding S191 – requires directors to disclose interests in transactions, s194 (private companies) – if meet s191, the company’s involvement (exists outside the company), and the company is being Minority Protection 4. office if this statement by manager ok – somebody at head office said it was fine – it at. shares of listed company, unless you disclosed that fact – question was, had M any resolution you want) – special resolution (three quarters of majority of those present – don’t take or get anything from the company without permission. would not – it would be those who had control and management of the company, Statutory LEGISLATION – duties apply to officers and directors of a company often do wish. 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2020 directors' duties company law notes