Company Law

NameProfessorSchoolDateIntroductionBy way of summary , this case pertains to a managing conductor who is at the same time the Chairman of the table of Directors of North Ltd . He was approached by S come to the foreh Ltd which expressed its interest to purchase dimension owned by North Ltd . He then persuaded the some other(prenominal) directors of his own each(prenominal)iance , North Ltd . to get in into a tackle of sale of a piece of land with the said keep ships company , South Ltd . As a result of this transaction , Zac , the managing director of the said company received a commission . He later revealed that he received commission from the transaction to the other directors . Eventually , the majority shargonholder discovered that the land change was developed by South and was later sold to another(prenominal) company for a higher priceThis essay aims to shed exculpated on the duties which the control board of Director of a company owes to his company . Specifically , this essay will deal with the repercussions when a director becomes interested with a contract entered into by his own company with another company . A discussion will besides be made on the right of action which the natural practice of law grants a stockholder in case the directors violate their fiducial duties to the corporationThe Board of DirectorsA company or a corporation is further an artificial being created by mere operation of law . It can only act through its representatives - the board of directors who are elected and chosen by the shareholders . As the representatives of the company , the Board of Directors of a corporation are vested with the authority to operate embodied agencys conduct all business and control and hold all properties of the corporation . The supreme authority insofar as the counseling of the business regular and ordinary affairs of the corporation is vested with the Board of Directors .

Thus , the board of directors of the corporation is responsible for the overall circumspection and management of the corporation . In this case , it is within the power of Zac , as the managing director of the company and the chairman of the board of directors , to enter into transaction with another company provided that the decision was made in a meeting duly called for that purpose and that the decision was with the apply of the stockholdersSection 229 (1 ) of the Companies Act clearly states that an officer of a corporation shall at all times act honestly in the act of his powers and the discharge of the duties of his office (Section 229 (1 ) Directors act as fiduciaries to the corporation , and erst elected they must serve the best interests of the corporation and the shareholders . A fiduciary is one who owes to another the duties of good faith , corporate trust , confidence and candor or one who must exercise a high standard of care in managing another s money or property . This fiduciary duty arises out of the board s fiduciary relationship with the corporation and shareholders (Saboor H . Abduljaami p2The quest are the...If you want to get a full essay, show it on our website: Orderessay

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