Directors

1.Whos a director? S250 CA 06 Any person occupying the position

of director, by whatever named called, is regarded as a director and
carries on duties as a director, is regarded a director in a company.
De facto director Act in the position of a director (eventhough)
may not have been appointed as director but given powers to run
company as a director.
De jure directors Formally appointed by the members of the
company . A person is a de jure director if (1) the person has been
appointed to the office of a director in accordance with the rules
governing such ap [from the learning slide]
Types of directors
-Managing director
-Executive and non executive directors
Lord Pregwood said that the directors are embodied to whom is
delegated the duty of managing the general affairs of the company.
A corporate body can only act by agents and it is of course the duty
of those agents so to act as best to promote the interest of the
corporation whos affairs they are conducting. Such agents have
duties to discharge of a fiduciary duty towards a principle.
Lord Evershed MR in the case of Greenhalgh v Arderne Cinemas
says, the phrase the company as a whole does not at any rate in
such a case as the present mean the company as a commercial
entity distinct from the corporators(epople who incoporate the the
company) as a general body i.e shareholders, creditors, employees
and also the general public.
^when talking about the company as a whole, it means that the
director must also take care of the interest of the shareholders,
general public etc because they make up the company.
-Percival v Wright A director was approached by a shareholder who
wished to sell his shares on the seashore. The director agreed to buy
them but failed to disclose the shareholder on information about an
impending takeover bid at a higher price for the shares. Th Director
made a profit and the shareholder wanted the contract rescinded on
the contract that has breache the fiduciary duty owed to him as a
shareholder. The court rejected the claim made by the shareholder
on the basis that the director owe a duty to the company as a whole
and not to individual shareholders.
-cf.coleman v Myers the managing director of a family company
arranged for the company to be taken over for an undervalue by
another company owned and formed by him. It was held that the
managing director had breached his duty to the minority
shareholders and had failed to disclose information concerning
potential profits does misleading the shareholders into entering the

contract of sale. This is a case decided in New Zealand. The NZ

court of Appeal did not regard Percival v Wright as being wrongly
decided, but held that in the special circumstance of coleman, there
was a fiduciary duty between the members and the shareholders
that caused the shareholders to habitually look to the defendants for
business advice and when information on the true value of the
shares were withheld from the other family shareholders by the
defendant, the defendants were indeed liable.
-Peskin v Anderson A dispute arose out of the demutualisation of
the royal automobile culb, of which the members of the time of the
sale, received a substantial payment. Forevermembers of the RAC
claimed that he was stupid that the directors were in breach of the
fiduciary duty to disclose the plan to demutualise they argued that
had they known of the proposal, they would have been able to make
a properly informed decision as to whether to remain as members.
The court dismissed the claim and it was held that the directors did
not owe any fiduciary duty. To the members who had terminated the
membership on their own accord when no specific proposal causing
contemplation.