Shareholder Hat, Director Hat

A recent case in the High Court, featuring a conflict between a shareholders' agreement and articles of association, analyses the position of parties to a shareholders' agreement who are also directors of the company and therefore subject to fiduciary and other duties owed to the company.

The case is of general interest because it is not unusual for one person to act in different capacities in connection with the same company: as well as being a director he might be a shareholder or an officer or representative of a shareholder. As shareholder he might advocate one course of action and the opposite course as director, so that in one role or the other he may appear to act purely formalistically.