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Part III The General Duties of Directors, 13 Duty to Exercise Independent Judgment

Marcus Haywood

From: Company Directors: Duties, Liabilities, and Remedies (4th Edition)

Edited By: Mark Arnold KC, Simon Mortimore KC

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2023. All Rights Reserved.date: 13 July 2024

Subject(s):
Approved person — Conduct of business regulation — Controlled activities — Regulated persons — Statutory duty

This chapter details the duty to exercise independent judgement of directors without subordinating their powers to the will of others, whether by delegation or otherwise. The duty is not infringed by acting per an agreement duly entered into by the company and in a way authorised by the company’s constitution. In the conduct of the management of its affairs, a company is entitled to the benefit of collective decision-making by its directors acting as a board. However, a breach of duty inevitably arises when a director’s relationship with a third party puts him in a position of conflict of interest. The chapter then considers the contracts restricting the future exercise of discretion.

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