Director Can Be Held Personally Liable

The Supreme Court ruled on 23 November 2012 that a managing director can be held personally liable if he has acted in breach of a personal duty of care, even if the company can also be held liable for the same actions. This type of liability is governed by the standard rules on tort and does not require serious culpability on the part of the director. The Supreme Court also held that a director can be held personally liable, alongside the company, for tortious conduct by the company. In short, this is the case where a director is seriously culpable in a personal capacity with regard to that conduct. 

Facts

The case arose from a dispute between the buyers of a villa on the Spanish Costa Blanca and both a company acting as an intermediary in the sale and its (indirect) managing director who maintained the contacts with the buyers. While viewing the construction project, the buyers came across municipal warning signs. The director told them that these signs were