Corporate Disputes Review | July 2022
Published on 19th Jul 2022
This edition considers some of the recent complex corporate and shareholder litigation to come before the English courts, including cases on the extent of director's duties, notice of breach and misrepresentation.
Conflicted? A pragmatic take on directors' duties and declarations of interest
Boards should take care accurately to record directors' declarations of interest and conflicts, and to brief or inform incoming directors about them to avoid future disputes over failure to disclose.
Once a director, always a director?
It is commonly understood that there is an absolute prohibition for a director to profit from property, information or opportunity through their role as a director, even if that director resigns his post first. It seems now, however, that the reach of the duties under the Companies Act 2006 extends so that a claim for breach may be founded on acts taking place after a person has ceased to hold office.
Notice of breach and commercial reality: what does 'reasonable detail' mean?
Any veteran of a corporate sale or purchase can vouch that a long time is spent making sure that the warranties and indemnities are both broad and painfully accurate. Yet the significant protection offered by warranties and indemnities can easily be lost if, upon their breach, the prescribed notice provisions are not respected and followed.
Careless talk costs consideration: misrepresentation in corporate transactions
Sellers must ensure the accuracy of the information disclosed throughout the due diligence process of a transaction or pay the price, as highlighted in two recent High Court cases.
Reflecting on reflective loss: ownership only counts if it's direct – or does it?
After the Supreme Court's attempts in Sevilleja v Marex to clarify the application of the principle of reflective loss to those who are not direct shareholders, a recent Court of Appeal case has re-opened the debate when it comes to claims by indirect shareholders.
Taking the register: the essential components for requesting to see a company's shareholder register
Where a company wishes to resist a statutory request to see the shareholder register, it can look for strict and exact compliance with the statutory regime, including the need for a "proper purpose".
LLPs and the Company Directors Disqualification Act - a blurring of the lines?
A recent decision in the English High Court means that members of limited liability partnerships can be disqualified for misconduct, regardless of their level of involvement in management of the LLP.