Cases
Ferguson v Wilson (1866) LR 2 Ch App 77
‘The company itself cannot act in its own person… it can only act through directors’, Cairns LJ, pp 89-90.
Ernest v Nicholls (1857) 6 HL Cas 401
‘[The shareholders] can only act through the directors, and the acts of the individual shareholders have no effect whatever on the company at large’, Lrd Wensleydale, p 419.
Bushell v Faith 1969 1 All ER 1002
Where directors were empowered by the articles to increased voting rights on any resolution to remove them as directors, such a right was valid even though this might in practice defeat the s 303 ordinary resolution power to remove directors.
Re Richborough Furniture [1996] 1 BCLC 507
‘…clear evidence that he had been either the sole person directing the affairs of the company [or acting with others all equally lacking in a valid appointment…) or, if there were others who were true directors, that he was acting on an equal footing with the others in directing the affairs of the company’ Timothy Lloyd, QC, at p 524.
De facto directors – ‘holding out’ test
Re Hydrodam (Corby) Ltd [1994] 2 BCLC 183
‘A de facto director is a person who assumes to act as a director. He is held out as a director by the company, and claims and purports to be a director, although never actually or validly appointed as such. To establish that a person was a de facto director of the company it is necessary to plead and prove that he undertook functions in relation to the company which could properly be discharged only by a director. It is not sufficient to show that he was concerned in the management of the company’s affairs or undertook tasks in relation to its business which can properly be performed by a manager below board level’, Millet J.
Re PFTZM Ltd [1995] 2 BCLC 354
PFTZM had operated a hotel but it was not as profitable as expected and its MD thought it would be unable to pay the rent. The landlord co. permitted PFTZM to continue trading provided that one of its
‘The company itself cannot act in its own person… it can only act through directors’, Cairns LJ, pp 89-90.
Ernest v Nicholls (1857) 6 HL Cas 401
‘[The shareholders] can only act through the directors, and the acts of the individual shareholders have no effect whatever on the company at large’, Lrd Wensleydale, p 419.
Bushell v Faith 1969 1 All ER 1002
Where directors were empowered by the articles to increased voting rights on any resolution to remove them as directors, such a right was valid even though this might in practice defeat the s 303 ordinary resolution power to remove directors.
Re Richborough Furniture [1996] 1 BCLC 507
‘…clear evidence that he had been either the sole person directing the affairs of the company [or acting with others all equally lacking in a valid appointment…) or, if there were others who were true directors, that he was acting on an equal footing with the others in directing the affairs of the company’ Timothy Lloyd, QC, at p 524.
De facto directors – ‘holding out’ test
Re Hydrodam (Corby) Ltd [1994] 2 BCLC 183
‘A de facto director is a person who assumes to act as a director. He is held out as a director by the company, and claims and purports to be a director, although never actually or validly appointed as such. To establish that a person was a de facto director of the company it is necessary to plead and prove that he undertook functions in relation to the company which could properly be discharged only by a director. It is not sufficient to show that he was concerned in the management of the company’s affairs or undertook tasks in relation to its business which can properly be performed by a manager below board level’, Millet J.
Re PFTZM Ltd [1995] 2 BCLC 354
PFTZM had operated a hotel but it was not as profitable as expected and its MD thought it would be unable to pay the rent. The landlord co. permitted PFTZM to continue trading provided that one of its