Conflicts Of Interest In Complex Investment Structures - The Evolution Of The Business Judgment Rule

Gowlings recently hosted a seminar/webinar for clients of our firm entitled The Business Judgment Rule—Fiduciary Duties Arising From Administration of Assets and For Approving Transactions. In that program, our panel of experts examined legal principles and strategies that govern when conflicts of interest confront officers and directors responsible for asset management decisions and transaction approvals in complex corporate structures, including those created for private equity funds and pension funds.

Where conflicts arise, our Canadian courts have gauged the actions of management according to the legal requirements of the business judgment rule and, in doing so, have often looked to developments under American case law for guidance and direction. As a result, participants in our program have asked to hear more on American trends in this area and how they may impact future developments in Canadian case law. This article is intended to address those issues.