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Ultraframe (UK) Ltd v Fielding & Ors [2005] EWHC 1638 (Ch)

By Oxbridge Law TeamUpdated 04/01/2024 07:01

Judgement for the case Ultraframe (UK) Ltd v Fielding & Ors

Lewison J

When is director liable?

  • 2 principles are clear:

    1. For application of no-conflict rule, no need for company to have ‘proprietary interest’ in opportunity diverted

    2. However after director leaves office, may be liable under:

      1. No profit rule

      2. If business opportunity is treated as ‘property’ of the company

Competing Directorships

  • Even if competing directorships give rise to potential conflict of interest, can be remedied by consent of boards of both companies

Where profit from breach goes to company

  • CMS Dolphin is WRONG.

  • No such thing as joint liability for breach of trust.

    1. Where director himself receives profit from breach of duty and puts it into a company, director is liable for knowing receipt.

      • Plus company potentially liable for knowing receipt.

    2. Where profits from a director’s breach of duty are paid directly to a company:

      1. If company is alter ego of director, Court will pierce corporate veil

        • Thus third party company liable to director’s original company

      2. If director owns large number of shares in company but it is not a mere alter ego,

        • Director is not personally liable to account for profits made

        • Company may be liable for knowing receipt

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For Further Study on Ultraframe (UK) Ltd v Fielding & Ors

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Company law Notes
805 total pages
1071 purchased

Company law notes fully updated for recent exams in the UK. These notes...