The board of directors oversee the company’s day to day affairs, while making operational and strategic decisions to ensure that they meet their statutory obligations. As managing director, the individual owes certain duties to the company, covered in the Companies Act 2006. The main duties directors should uphold include:
- To promote the overall success of the company
- To act within his or her powers and good faith
- To exercise independent judgment
- To avoid conflicts of interest
- To exercise reasonable care, skill and diligence
- Not to accept benefits from third parties
- To declare all interests in a proposed transaction or arrangement
Some of the most important director’s duties relate to the managing of company finances and keeping a steady cash flow so as not to become insolvent. It is vital that all company directors understand and apply their statutory duties, as failure to do so may result in dismissal fines and in the most serious circumstances, being charged with a criminal offence.
Depending on the severity of the breach in directors’ duties, the company can invoke:
- An injunction
- Setting aside director transactions
- A personal claim of director’s liability for them to pay the damages and compensation that resulted in a loss for the company
- Director dismissal
- A director being ordered to pay over any profits gained in breach of duty or transfer any property that should rightly belong to the company
- Criminal charges against the director including a fine or possible imprisonment
If you think you may have breached any of your director’s duties, it is important to seek expert legal advice at the earliest possible opportunity to avoid personal liability.
Our corporate barristers act for both company shareholders and directors, to ensure they get the best possible outcome. We want to offer you a quick and amicable end to your dispute, so you can focus on what matters. We can provide both parties Alternative Dispute Resolution (ADR) or in cases where these means have been exhausted, representation for commercial litigation.
Don’t hesitate to contact a member of our team to better understand your director’s rights and responsibilities. Our corporate solicitors are here to offer you practical advice and affordable payment plans. Call us on 0203 376 1888.
Spread your legal expenses conveniently over time to minimise impact on your business
We provide payment plans to cover your legal costs, so you or your business can get the legal support you require – without the need for large up front payments.
We will connect you with a lawyer who specialises in company law matters and who is right for your individual circumstances. If you have already appointed a lawyer, we can still offer you a payment plan solution and will make all the necessary arrangements with your lawyer on your behalf.
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