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United Kingdom directors dutiesproper purposemisapplication of assets

Bishopsgate Investment Management Ltd v Maxwell

[1994] 1 All ER 261; [1993] BCLC 814; [1993] BCC 120
JurisdictionUnited Kingdom
CourtCourt of Appeal (Civil Division)
Year1994
StatusBinding authority

Key Principle

A director who signs away company assets for no consideration, in favour of an associated company, acts prima facie for an improper purpose and in breach of fiduciary duty; the burden then lies on the director to demonstrate the propriety of the transaction, and a director cannot abdicate responsibility by signing documents without enquiry.

Area of Law

General

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