Articles

Section 131: Duty of Directors to Act in Good Faith and in Best Interests of Company

Wednesday, September 20, 2017
In accordance with Section 131 of the Companies Act 1993 ("Act"), directors have a duty to act in good faith and in what they genuinely believe to be the best interests of the company.  While it may be expected that directors should always behave in such a manner, and not place their personal interests ahead of the company's, various judgments have explored the extent of this duty and provided more information about the considerations director should take account of when exercising their powers.

The Duty
As noted in the decision of Sojourner v Robb1, the duty is one of loyalty and arises out of the fiduciary relationship that directors owe to the company from their position as its agents.  Additionally, although a director must act in good faith and in the best interests of the company on most occasions, Section 131 of the Act outlines that there are a few exceptions to this duty which allow a director to act otherwise, as follows: Read more

Section 135 of the Companies Act - Reckless Trading:

Tuesday, July 18, 2017

Non-Executive or Passive Directors and Directors' Duties: The Courts Take no Excuses for a "Hands Off" Approach Read more

Directors' Duties - What Directors Need to Know

Tuesday, July 18, 2017

In New Zealand, there are few prohibitions on who can become a director of a company, and no real qualification requirements.  This means that some people become directors without actually understanding what their role requires.  This can result in a company not being managed and governed as required by the Companies Act 1993 ("Act"), which in turn can lead to a breach of duty, which can have very serious consequences, up to and including personal liability for company debts or even criminal sanctions in the worst of cases. Read more

Company Law Case Summary: Mike Pero Mortgages Limited v Mike Pero [2016] NZHC 3185 per Katz J

Tuesday, July 18, 2017

Background Read more

Recent Posts


Tags

Fair share Consumer credit contracts Abuse Invalid wills Company Law Due Diligence Income Mortgage Validity of Wills De facto Commercial Property Executors duty Companies Act 1993 Pattern of offending Principal Document Disclosure Landlord Domestic Violence Act 1995 Immigration New Zealand Financial services Acknowledgment of Debt Will Personal Psychological abuse Wills Reckless Trading Twelve years Wills Act 2007 Family Trusts Beneficiary Rights Broadbent v Ministry of Social Development Deceased's wishes Testamentary freedom Resident Visa Limitation defence Tamarapa v Byerley Ship Contract Law Financial Advisers Act 2008 Section 15A Gifting Limitation period Trusts Auckland Office Zero Hour Contracts Privacy Act 1993 Part payment Tenants Ilott v Mitson 2017 UKSC 17 Limitation Act 1950 Directors' Duties Skilled migrant Offending Seperation Subsidies Violence Gifts Changes Anti-money laundering (AML) KiwiSaver Vessel surveyor Valid wills Hawkes Bay Trustee Company Limited v Judd Testamentary capacity Administrators duty Testamentary Promises Contract and Commercial Law Act 2017 Business Re Estate of Campbell Personal Properties and Securities Act 1999 Case Study Wills Act 2007 Section 14 Tenant Residential Interpretation of documents Financial products Re Estate of Feron Domestic violence Charity ''Best Endeavours'' Mortgagor Property Trustee Duties Erceg v Erceg Economic disadvantage Commercial Trusts Bill Limitation Act 2010 Intellectual Property Body Corporate Property (Relationships) Act 1976 Testamentary writing Health and Safety Reform Bill Charities Commercial Law Fair Trading Act 1986 Will that do SMC Protector Partner of resident Trust Check Up Duress Resident Murrell v Hamilton Interpretation Act 1999 Clayton case Loss of income Trust Confidentiality Undue influence Living standards Vessel Sale and Purchase Protection Order Mortgagee Break up Shareholders' Agreement SN v MN [2017] NZCA 289 Insurance Credit Contracts and Consumer Finance Act 2003 (CCCFA) Claims against estates Ministry of Social Development Acknowledgment Visa application Sale of Goods Litigation Frustration Wills Act 2007 Section 8 Lease Interest Charity begins at home Physical abuse WINZ Elder Law Lump sum Relationship Property Legislation update Lease Titles Repayment Ministry Skilled migrant points Employment Maritime Law Vessel survey Unfair contract terms Lankow v Rose Blackwell v Hollings Recovery of money Eviction Character requirements Section 182 Family Proceedings Act 1980 Expression of interest Grey Power Financial Markets Conduct Act 2013 (FMCA) Immigration Interpretation Act 1999 Section 29 Division of Functions Civil union Compensation Wilson v Donnellan Work and Income Six years Amundson v Raos Verbal abuse Estate Administration Wills Act 2007 Section 11 Trust busting Section 15 Terms of Trade Constructive trusts Temper Marriage Partnership based work visa Albany Office Creating Trusts Rest Home Subsidies Family Protection Act 1955 Asset Protection White v White Financial services provider (FSP)

Archive