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Directors' Case Duties

Regal (Hastings) Ltd v Gulliver (1942)

Directors must not personally profit from corporate opportunities without company consent.

Directors bought shares for themselves in a transaction meant for the company and were held accountable for their personal gains.

IDC v Cooley (1972)

Directors must not exploit corporate opportunities for personal gain.

A director secured a contract personally after being denied company approval and was forced to account for his profits.

Bhullar v Bhullar (2003)

Directors must disclose all potential conflicts of interest, even if the company was not directly interested in a business opportunity.

Directors of a family business bought a property privately without telling the company, breaching their duty.

Re D'Jan of London Ltd (1994)

Directors must exercise due care when signing documents, including insurance policies.

A director negligently signed an insurance form, leading to the company being denied a claim.

Re Continental Assurance Co of London plc (2007)

Directors must monitor a company's solvency closely and avoid reckless trading.

Directors were criticised for failing to spot warning signs of financial collapse.

Re City Equitable Fire Insurance Co Ltd (1925)

Directors cannot escape liability by claiming ignorance of business mismanagement.

Directors were found liable for failing to detect fraud due to negligence.

Re Westmid Packing Services Ltd (1998)

Directors who allow shadow directors (unofficial controllers) to dictate company policy are personally liable.

A shadow director influenced company decisions without a formal role, and the board was held responsible.

Percival v Wright (1902)

Directors owe duties to the company as a whole, not individual shareholders.

Shareholders sued directors for failing to disclose negotiations, but the court ruled directors were only obliged to act in the company�s interests.

Boardman v Phipps (1967)

Directors and fiduciaries cannot benefit personally from business information acquired in their role.

A trustee made a personal profit using company knowledge and was required to return the benefits.

Dorchester Finance Co Ltd v Stebbing (1989)

Directors, even non-executive ones, must exercise reasonable care, skill, and diligence.

Two non-executive directors failed to oversee financial decisions and were held personally liable.

Re Produce Marketing Consortium Ltd (1989)

Directors are liable for wrongful trading if they continue operating a company when insolvency is inevitable.

Directors were personally liable for debts as they failed to prevent worsening financial distress.

BTI 2014 LLC v Sequana SA (2022)

Directors owe a duty to creditors when insolvency risks become real, not just imminent.

Directors paid out dividends despite rising debts, leading to liability for failing to consider creditors' interests.

Secretary of State for Trade and Industry v Baker (1999)

Directors who fail to keep proper records or act negligently can be disqualified.

A director was disqualified for six years due to failure in maintaining business records.

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