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Law Cases
Company Law Cases
Directors' Duties Cases

Coleman v Myers [1977] 2 NZLR 225

Country:
United Kingdom
By Oxbridge Law Team
Held
Facts

  • Defendant was director of family company. Defendant made offer to buy shares of other members of company, and invoked statutory power of compulsory purchase.

  • Claimant, other shareholders, brought action alleging breach of fiduciary duty owed by Defendant to shareholders, in that Defendant had not disclosed information relevant to true price of shares.

Held

  • Fact that directors’ duties are owed to company does not stop them coming to owe fiduciary duties to shareholders.

  • This may happen where:

    1. There is agency relationship

    2. There is special factual relationship giving rise to fiduciary duty

Facts

  • Company was small family company

  • Shareholders heavily depended on Defendant for information and advice

  • Transaction was significant

  • Information relevant to true price of shares had been withheld from shareholders

  • Thus special facts gave rise to fiduciary duty on part of D to make full disclosure, and Defendant had breached this duty

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