MBA Essay代写范文-公司董事避免利益冲突的义务，本文是一篇留学生MBA Essay范文，主要内容是讲述众所周知的公司具有独立的法人资格。然而，公司并非法人，因此无法管理其业务或资产。董事的角色对于代表公司管理其利益和事务非常重要。存在滥用权力的恐惧，似乎董事被赋予了广泛的权力。因此，当前的《2006年公司法》（CA）对董事的职责进行了编纂，其中包括避免利益冲突的职责，这是本篇MBA Essay的重点。下面就一起来看一下MBA Essay代写范文的全部内容。
i. Conflict of Interest under Sc 175
ii. Scope of Corporate Opportunity
iii. Regal Hastings: strict approach
vi. Boardman: no-conflict rule
v. Liberal Approach
vi. Bhullar v Bhullar: business line test
vii. Avoiding Conflict of Interest
a. Sc 175 (4)(a)
b. Sc 175(4)(b): Authorization
It is well recognized that company has a separate legal personality. However a company is not a legal person per say, therefore it is unable to manage its business or assets. Hence the role of a director is important to act on behalf of the company in managing its interests and affairs. Thus, there is a fear of abuse of power seemingly directors are given an extensive power. As such, the current Companies Act 2006 (CA) has codified directors’ duties and this includes the duty to avoid conflict of interest, which is the pivotal focus of this essay.
This assessment will starts with a brief introduction of conflict of interest, which is codified under Sc 175 of the Companies Act 2006. The duty to avoid exploitation of corporate opportunity is provided under Sc 175(2). However it does not define the scope of opportunity. Thus the next part of the essay will refer to the common law approach, particularly the influence of the no-profit and no conflict rules which has defined and characterized corporate opportunity. In doing so, it is evident that the directors are not freely to pursue opportunity, however the strict common law approach has been relaxed under Sc 175(4) which will be discussed at the end of the essay.
i. Conflict of Interest under Sc 175 第175条下的利益冲突
One of the main reforms of the Companies Act 2006 was the codification of directors’ duties. Through the proposal from the Law Commission and Company Law Steering Group, the legislators had replaced the common law system so that directors have a clear view of their duties, which they owed to the company. An important regulation was Sc 175, which illustrates a general duty of directors to avoid conflict of interest. The applicability of this duty is taken in a broader context where director must avoid situation that may be conflicted directly or indirectly with their interest. However not all conflict of interest would fall under this provision. For instance, a benefit that was conferred by a third party would be covered under Sc 176.
As mention earlier, the duty under Sc 175 is fiduciary in nature where the director shares a trustee-beneficiary relationship with the company. As echoed by Lord Cranworth that ‘it is a rule of universal application’that trustees should not enter into contracts where their personal interests conflict with those ‘he is bound to protect’. This equitable rule requires the fiduciary to avoid any conflict of his interest against his principal. In essence, a director is assumed to have a sense of loyalty to the company especially since he is entrusted to manage the company’s asset. Schaller provides an insight that it is better to link this relationship with agency law, as it is a matter of the agent owing the principal a fiduciary duty of undivided loyalty. This is due considering the fact that the directors are designated to act solely in all matters that is connected to the company therefore they are strictly refrains from competing against the company.
ii. Scope of Corporate Opportunity 公司机会的范围
In addition to the ‘no-conflict’ rule, Sc 175(2) sets out the ‘no-profit’ rule. This provision exemplifies the common law corporate opportunity doctrine and prohibits the act of exploitation by the director, It should be noted that this prohibition is not only limited to ‘property, information or opportunity’, but to cover other economically feasible interest to the company.
The ‘no profit’ rule in Sc 175(2) has by large under the influence of the strict view adopted by the English common law. Now, neither Sc 175(2) nor the common law has provided the definition of corporate opportunity. Instead the scope of corporate opportunity is closely linked with the rules of fiduciary duty. Generally it was decided in Keech thattrustee could not renewed the property for the benefits of himself. The significant of such has acted as an analogy for directors. Therefore, a director cannot act upon the corporate opportunity in light of his fiduciary capacity in the company. This is because directors must act in the best interest of the company and not to ‘enter into engagements in which he has or can have a personal interest conflicting or which possibly may conflict with interests of those whom he is bound to protect’. A classic example can be seen in the case of Regal (Hastings) Ltd v Gulliver where the court had perceived a strict view to circumscribe corporate opportunity and held that the directors had ‘material conflicts of interest and duty’.
iii. Regal Hastings: Strict Approach 富豪黑斯廷斯：严格的方法
By way of background, the directors of Regal Ltd set up another subsidiary company, Amalgamated to acquire the other two cinemas in Hastings. However the landowner insisted that a personal guarantee of the rent and the paid up capital in Amalgamated to be increased. As Regal Ltd could only find £2,000 of the total sum, each of the directors in Amalgamated, solicitor and other investor decided to apply for 500 shares each. Subsequently the parties then sold the shares in Amalgamated to the purchasers at a profit and Regal Ltd under the control of the new purchasers pursued a claim for the recovery of sum made by the directors and solicitor for the profits made upon the opportunity. It was argued that profits made should be returned to the company as there was a conflict of personal and company interest seemingly formers directors had used their position to gain the shares.
作为背景，Regal Ltd的董事成立了另一个子公司，合并后收购了黑斯廷斯的另外两家影院。然而，土地所有者坚持要求增加对合并后的租金和实收资本的个人担保。由于富豪有限公司只能从总金额中找到2000英镑，合并后的董事、律师和其他投资者决定各自申请500股。随后，双方将合并后的股份以利润出售给购买者，而在新购买者的控制下，Regal Ltd提出索赔，要求收回董事和律师就该机会产生的利润所支付的款项。有人争辩说，由于存在个人和公司利益冲突，因此所获得的利润应返还给公司。似乎前任董事利用其职位获得了股份。
What immediately distinguished corporate opportunity in Regal Hastings is the position of director in discharging his duty. It was explained by Lord Macmillan that the acquisition of the cinema was an opportunity because it was related to ‘the affairs of the company’. Accordingly, the directors had ‘in the course of their management…with special knowledge as directors’ had created the opportunity to finance the acquisition. The court has viewed the shares of Amalgamated were acquired simply because of their knowledge and position as directors for Regal Ltd. Thus such profits obtained from the exploitation of the opportunity are prohibited.
The reasoning in Regal Hastings emphasized that directors must act in the best interest of the company. Thus the essence of the ‘no profits’ rule derives thereon and states that directors are not entitled to exploit the corporate opportunity, which ‘resulted in a profit to themselves’. Simply this means that scope of corporate opportunity overlaps with the fiduciary duty of the director; hence in this context, the profits attained would be an emblem of a disloyalty of the fiduciary.
As consequences, Regal Hastings was described as ‘draconian’ because it does not offers flexibility in business decision. Firstly, the opportunity to acquire the shares in Amalgamated has been offered to the company. However, it was the company itself who declined the offer, as it was unable to gather more funds. Therefore, as a matter of fact, if a bone fide decision has been made by the company not to pursue the opportunity, then by all means the directors should not be accountable for the profits they have eventually made. This reasoning formed the basis of the ‘no profits’ rule that is describe as strict and inflexible as it limits the scope for the director to take the opportunity. This is because the House of Lords did not deliberate on whether the company itself could have the potential to exploit the opportunity. It was commented that the court was fixated on the opportunity that arises from the position of the director that it has failed to consider from the position of the directors who has acted in good faith. A comparison drawn with Cook v Deeks whereby three directors of the railway company had set up another new company with intention to divert the opportunity of the construction contract away from the primary company.
因此，Regal Hastings被称为“严厉的”，因为它在商业决策中没有提供灵活性。首先，已向公司提供了收购合并公司股份的机会。然而，由于无法筹集更多资金，该公司自己拒绝了这一提议。因此，事实上，如果公司做出了不追求机会的真诚决定，那么董事们无论如何都不应对他们最终获得的利润负责。这一推理构成了“无利润”规则的基础，该规则被描述为严格且不灵活，因为它限制了董事抓住机会的范围。这是因为上议院没有考虑公司本身是否有潜力利用这一机会。有人评论说，法院专注于董事的职位所带来的机会，而法院没有考虑到诚信行事的董事的职位。与库克诉迪克斯案（Cook v Deeks）的比较表明，铁路公司的三名董事成立了另一家新公司，目的是将施工合同的机会从主要公司转移出去。
Contrasting this here, the directors in Regal had acted in good faith and took an extra risk to develop the project when the company was unable to do so. The company would have incurred further loss if the directors had not exploited the opportunity.
It seems that liability was simply attached to them because of their position in the company. This lead Keay to comment that the English position has suggested that the fiduciary duty is all encompassing and consuming because the director has ‘no commercial life outside of the company’.
Nevertheless, the House of Lords agreed that it is a misapprehension to question on the position of the director who has been acting bone fide.. Instead the correct preposition was whether the director has been profiting from his position in the company. As put it in words by Lord Russell of Killowen that the rule of equity ‘in no way depends on fraud, or absence of bona fides’.Hence the court has made it clear that motives of the director are irrelevant to circumscribe corporate opportunity. In deciding so, an objective test was adopted to evaluate whether corporate opportunity falls within the fiduciary from the viewpoint of the director having the knowledge. The court was clearly driven with the idea that it is important to uplift the nature of fiduciary loyalty whereby the principal will not be left in the vulnerable position. Especially since the fact that company cannot own opportunities, directors will be at their liberties to fully utilize the opportunity for their own advantages which would lead them to neglect their duty to act in the best interest of the company. Therefore such strict approach to determine the scope of corporate opportunity is necessary to cover situation where a company is unable to act on its own to protect its assets. Thus it is safe to assume that law on the ‘no profit’ rule is reasonable as it act as a regulatory mechanism where the directors are aware and reminded not to take advantage of the opportunity due to the company’s inaccessibility. For instance, in an attempt to prevent the directors from any personal opportunity such as selling or buying of shares, Sky Plc has formed a new special committee to ensure that the board is free from any conflicts of interest in dealing with confidential information during the take over bid by 21st Century Fox.
iv. Boardman: no-conflict rule 博德曼：没有冲突规则
The application in Regal Hastings on the ‘no-profit’ rule has ‘figured so prominently’ in deciding the scope of corporate opportunity. So much so, its essence when encountering opportunity has been extended in Boardman. In this case, Boardman the acting solicitor, has obtained useful information and proceeded to exploit the opportunity by capitalizing the assets of the company and in return attained some profits for him as well as the directors. However one of the directors alleged a conflict of interest thus proceeded to sue their profits.
The issue here was whether Boardman is liable for the personal profits deriving from the information. Going back to Regal, the opportunity in question was only available during the directorship. However information could -as echoed by Lord Upjohn falls ‘outside the scope of agency’ because it can be freely accessible even to the public and not necessary confined to the directors in office. Nevertheless, the majority of the House of Lords in Boardman ensued to treat the acquired information in the similar manner as company’s property. In lieu with that, Boardman has acquired the confidential information whilst he was acting on behalf of the trustees. Thus the profit earned flowing from the opportunity was during his capacity as fiduciary, an eminent conflict of interest.
In this instance, it seems that the majority judges had disregarded the fiduciary was acting bone fide on behalf of the trust. In Boardman, the profits deriving from the opportunity do not exemplify the conduct of disloyalty. It has been commented that there ought to be a line drawn between the duty to avoid conflict of interest and the role of fiduciary because not all disloyalty colludes with dishonestly. For instance the exploitation of opportunity in Boardman has allowed the company to gain profits. Similarly in Muradwhere it was held that Al-Saraj has to be accounted for all profits attained from the opportunity due to his failure of disclosing information despite the Murad sisters have received profits. It appears that the law has disregarded the causal link between fiduciary and the profits especially when the directors have not fraudulently exploited the opportunity but the court has insisted to impose a strict duty on the directors regardless of their honesty. Thus, this prompted the Court of Appeal in Murad to comment ‘it may be that the time has come when the court should revisit the operation of the inflexible rule of equity in harsh circumstances’.
Subsequently the decision in Boardman has also illustrated that, in addition to the ‘no-profit’ rule, there is another ‘no-conflict’ rule in defining corporate opportunity. This led to the question of whether both the rules are applied co-existingly or separately. Interestingly, Lord Uptown the dissenting judge has argued that the court was too keen to apply the strict approach in Regal without deciding on merit of the case. Kershaw have commented that the ‘no-profit’ and ‘no-conflict’ rule should be a separate and independent set of rules. However the decision by the majority in Boardman has illusions that the no-profits operate as parameter of the ‘no-conflcit’ rule which subsequently determine the rule itself. In doing so, it has epitomized the strict nature of the ‘no-conflict’ rule because the English courts were enthusiastic to attach the duty of fiduciary of loyalty to director thus considered the ‘no-profit’ rules as part of the ‘no-conflict’ rules. For instance it is difficult to consider Boardman to have a fiduciary duty to the company, as he was just a solicitor, but the point where he obtained the profits from the information would out rightly placed him in conflict of interest. Thus it was opinioned that the no-profit rule is an instantiating rule of the no-conflict rule.
Subsequent cases have been influence by the decision in Regal/Boardman. In Industrial Development Consultants v. Cooley the pertaining issue was whether the director could be accountable for the profits even if the company could not have obtained the opportunity. The court held that the director was in breach of his duty even though the contract was offered due to the director’s expertise. Lord Roskill referred that the information on the opportunity was of concern and relevant to the company thus director has the liability before accepting the contract. By this reason, there was a connecting link between the profit and fiduciary as the information on the opportunity was given whilst he was still employed as the director in the company.
随后的案件受到富豪/博德曼案判决的影响。在Industrial Development Consultants v.Cooley案中，相关问题是，即使公司无法获得机会，董事是否可以对利润负责。法院认为，尽管合同是由于董事的专业知识而提出的，但董事违反了他的职责。罗斯基尔勋爵提到，有关该机会的信息与公司有关，因此董事在接受合同之前负有责任。由于这个原因，利润和受托人之间存在着联系，因为有关机会的信息是在他仍然担任公司董事时提供的。
v. Liberal Approach 自由主义方法
As opposed to the strict approach in Regal, some cases have resorted in pragmatism to evaluate corporate opportunity. Despite Regal has made much influence in the UK law, nevertheless attempts have been made to narrow down the scope on what constitutes corporate opportunity.
One of the main reasons for the departure was because the strict rule in Regal was stringent in the modern business context. There is a need to identify that not all opportunity are known to the directors due to their position in the company. Opportunity could also derive subsequent to the directors’ expertise and experience. Likewise in Peso Silver Mines, the company has been approached with an opportunity to acquire the land but it was rejected, as the company cannot restrain its resources any further. The issue here was whether can director seized the opportunity after the company’s rejection.
This case has referred to principles held in Regal where the Canadian Supreme Court has to consider the director’s liability. The distinction was, the owner of the land then approached and offered the sale of the land to one of the directors of the company who then set up a new company to acquire it. Ultimately the control of the company changed and the new directors proceeded to sue the now dismissed director for the profits made from exploiting the opportunity. Interestingly the court held that the director was not in breach of his duty despite the director had acted upon the opportunity as per Regal. This is because there were evidence that there were many offer made to the company previously, thus the court was convinced that the directors had acted in good faith and for the best interest of the company to decline the opportunity. And after the rejection, it appears that the director was not in his fiduciary position but in his private capacity when the opportunity was offered again.
It was put forward that such conclusion was necessary especially because ‘the complexity of modem business, modern practice and the modern way of life, the strict rule laid down in the Regal and other cases should not be applied’as not all opportunity belong to the company. The liberal approach has refined the scope of corporate opportunity and this was credited to be a ‘desirable development’because it recognized that exploitation of opportunity might not necessary give rise to conflict of interest. For instance in the Australian case of Green v Bestobell Industries that though the manager was held to be breach conflict of interest but the profits he gained from the opportunity has no connection with his fiduciary position as the news of the tender was made to the public at large.
Therefore it appears that the scope of corporate opportunity as defined in Regal is vague as it has exemplifies that any opportunity belongs to the company in equity. The English court has vigorously involve the duty of fiduciary with the application of the no-profit rule even if it does not relates to the exploitation of corporate opportunity. This puts the UK law at odds with the position in United States whereby corporate opportunity is only confined if it falls within the company’s business line. Kershaw has commented that the US approach is more flexible than English Law as it allocate ‘greater proportion of potential opportunity’ for the directors because this test will relates if the opportunity can be utilized by the company such as if the company’s financial state ability to consider if such opportunity belongs to it. Take for instance in Guth v Loft, profits made from the opportunity byGuth was accountable Loft Inc as the company’s capital and facilities was used to acquired of Pepsi. It was clear that the director has misused their position to further their personal interest. The US approach has provided an extension to distinguish corporate opportunity to a more realistic and judicial certainty because it relates and considers the opportunity that was pursued by the directors is actively or intimately connected with the company’s existing or current activities. Hence many have ‘welcome and realistic position for the English Law to adopt’.
因此，Regal中定义的公司机会范围似乎很模糊，因为它已经证明了任何机会都属于公司股权。英国法院在适用“无利可图”规则时大力要求受托人履行义务，即使该规则与利用公司机会无关。这使英国法律与美国的立场相悖，美国的立场是，只有在公司的业务范围内，公司机会才受到限制。Kershaw评论说，美国的方法比英国法律更灵活，因为它为董事分配了“更大比例的潜在机会”，因为该测试将涉及公司是否可以利用该机会，例如公司的财务状况是否有能力考虑该机会是否属于公司。例如，在Guth v Loft中，byGuth从机会中获得的利润由Loft Inc负责，因为该公司的资本和设施用于收购百事。很明显，董事滥用他们的职位来促进他们的个人利益。美国方法提供了一个扩展，以将公司机会区分为更现实和司法确定性，因为它涉及并认为董事追求的机会与公司的现有或当前活动密切相关。因此，许多人对英国法律持欢迎和现实的立场。
Conversely it is a matter of policy grounds to adopt a liberal approach especially in the context of director resigning from his position. The rule in Regal has been extended to director who has resigned from his position. As provided in the case of CMS Dolphin Ltd whereby the company has successfully claimed for the profits deriving from the opportunity made by the director prior to his resignation. It was held that there must be ‘some relevant connection or link between the resignation and the obtaining of the business’. In this case here, the director has dishonestly transferred the opportunity away from the company prior to the resignation. Thus the profits made were accountable to the company.
相反，采取自由主义方法是一个政策依据问题，尤其是在董事辞职的情况下。《富豪》中的规定已扩展到辞职的董事。根据CMS Dolphin Ltd的规定，该公司已成功申请董事在辞职前获得的机会产生的利润。有人认为，“辞职与获得业务之间必须存在某种相关联系或联系”。在这种情况下，董事在辞职前不诚实地将机会从公司转移出去。因此，所获得的利润应向公司负责。
However the English court has taken the liberal approach in situation where the director has been forced to resign by the company. This can be seen in the case of IEF where the director has gained profits from the contract after his resignation from the company. Hutchison J opinioned that the director has resigned due to the dissatisfaction with the company and not prompted to acquire the opportunity. Furthermore the company was not actively seeking from the orders. His Lordship has highlighted that ‘directors alone, because of the fiduciary nature of their relationship with the company, were restrained from exploiting after they had ceased to be such any opportunity of which they had acquired knowledge while directors’. It is highlighted that it was against public policy to hold them from exploiting opportunity deriving from their knowledge and expertise. Thus it was held that the director is permitted to keep the profit. Furthermore the strict rule is irrational to continuously bind the director even when he has resigned from his position and accept his employment elsewhere. Take for instance, every opportunity received by Eric Schmidt, CEO of Goggle cannot be regarded as conflict of interest is due to his previous affiliation as one of the board members in Apple. It could be perhaps due to his experiences in managing the mobile phone production which is a small industry .
Despite above, the preposition for maintaining the strict rule in Regal has its advantages as well. In contrast, the liberal nature of the rule has neglect the duty of loyalty imprint in directors. This lead Beck to criticize the liberal approached has placed the law on fiduciary as ‘inadequate to deal with the corporate context’. Put simply, the significant of the liberal approach shows that director is allowed to accept opportunity which is valuable to him personally but detrimental to the company. Flannigan for instead has stressed that the absence of adhering the strict rule would be ‘technically or delectably disadvantageous’because less degree of protection is offer to the trust and this would attribute to misconduct such as misuse of position. Likewise this could be seen in the commercial reality where Olympus has overpaid its advisor, Axes Americas in the acquisition of Gyrus Group Ltd. The refusal by Olympus to reveal the identity of the owners of Axes Americas has probe and hint that the directors of Olympus has been obtaining personal benefits deriving from the acquisition opportunity. As clarified by Valsan that the central reason for strictness of the test is to prevent the self-interest from interfering with the director’s duty to act in the best interest of the company. Therefore the decision in Regal is prudent as it provides certainty because it explains that the issue is not about the directors acting in good faith but touches upon fiduciary loyalty duty.
尽管如此，在Regal中保持严格规则的介词也有其优点。相反，该规则的自由性质忽视了董事的忠诚义务。这导致贝克批评自由派的做法，认为信托法“不足以处理公司环境”。简言之，自由主义方法的重要性表明，董事可以接受对他个人有价值但对公司有害的机会。相反，弗兰尼根强调，不遵守严格的规则将“在技术上或令人愉快地处于不利地位”，因为向信托提供的保护程度较低，这将归因于不当行为，如滥用职位。同样，这可以从商业现实中看出，在收购Gyrus Group有限公司时，奥林巴斯向其顾问Axes Americas支付了过高的费用。奥林巴斯拒绝透露Axes美洲所有者的身份，这表明奥林巴斯董事一直在从收购机会中获得个人利益。正如Valsan所阐明的，严格测试的核心原因是为了防止自身利益干扰董事为公司的最佳利益行事的义务。因此，Regal的决定是谨慎的，因为它提供了确定性，因为它解释了问题不是关于董事诚信行事，而是涉及信托忠诚义务。
vi. Bhullar v Bhullar: business line test 布勒诉布勒：业务线测试
Aside from the above, the court in Bhullar v Bhullar has explored and redefined the ‘no-conflict’ rule held in Boardman. The facts involve a family company – Bhullar Bros Ltd, whose relationship had broken down and prompted both the brothers and their sons to negotiate to split the company assets. In the aftermath, the defendants chanced upon the sale of property and acquire it through their very own company, Silvercrest. Thus the issue is whether directors were liable for acquiring the property.
除此之外，法院在Bhullar诉Bhullars案中探讨并重新定义了Boardman案中的“无冲突”规则。事实涉及一家家族公司——Bhullar Bros Ltd，其关系破裂，促使兄弟俩和他们的儿子进行谈判，以分割公司资产。事后，被告碰巧出售了财产，并通过自己的公司Silvercrest收购了该财产。因此，问题在于董事是否有责任收购该财产。
In lieu with Boardman decision, the court at first instance held that the defendants were in breach of their duty due to the nature of the no-conflict rule lies in the fiduciary position. In other words, the defendants in Bhullar would be accountable to the fiduciary position disregarding the fact that the information of the property was obtained in their private capacity.
However, the Court of Appeal took the otherwise direction and examine on the issue of whether the director could acquire the opportunity pending to a negotiation. Their Lordships referred to dissenting judgment of Lord Upjohn in Boardman who remarked that conflict could be avoided ‘if the situation cannot reasonably be regarded as likely to give rise to a conflict of interest’ . This test dictates that a potential conflict arises if the opportunity is within the scope of business of the company and it does not depend on the ‘maturing business opportunity’ but on the idea of a reasonable man determining through the facts the case if there was a real possibility of conflict. Hence, it would not depend on the assumption to treat all opportunity as belonging to the company to determine the conflict. In this instance, it was viewed that the property would have been valuable to increase the Company’s commercial value thus the opportunity would falls within it’s existing business line.
Moreover as the defendants were still ‘carrying on business namely as the director of the company… in that capacity they were in a fiduciary relationship with the company’, there was a real sensible possibility of conflict when the directors have converted the opportunity to themselves.
The judgment in Bhullar was said to embrace the American approach of the ‘line of business test’. Gower for instance has observed that this is a notable decision because the Court of Appeal has supported the scope of business test in identifying the corporate opportunity. This test empowered that an opportunity if embraced ‘fundamental knowledge, practical experience and ability to pursue, which, logically and naturally, is adaptable to its business … it may be properly said that the opportunity is in line of the corporation’s business’. Therefore so long as there is commercial value to the company, the director cannot pursue the opportunity.
Despite the above,in O’Donnell v Shanahan, the Court of Appeal took the otherwise approach. In short, the salient facts involve a claim against the former directors for acquiring a property, which might have been purchased by the company. The court at first instance found that there was no possibility of conflict because the company’s business was providing financial and advisory services, thus property investment would not have fallen within its business line. The Court of Appeal has furthered that the scope of business is only confined to partnership because its agreement could determine the scope of the partnership’s business and the fiduciary duties. Hence the test adopted in Aas v Benham should be departed. Instead, it was viewed that the opportunity to acquire the property was known to the director during their capacity as directors of the company. Thus the no profit rule was applicable based on the facts, and the directors had triggered the no conflict rule when they have acted upon the opportunity. As such, the lower court’s decision was reversed.
尽管如此，在O'Donnell诉Shanahan案中，上诉法院采取了另一种方式。简言之，突出的事实涉及对前董事的索赔，因为他们收购了公司可能购买的财产。初审法院认为不存在冲突的可能性，因为该公司的业务是提供金融和咨询服务，因此房地产投资不属于其业务范围。上诉法院进一步指出，业务范围仅限于合伙企业，因为其协议可以确定合伙企业的业务范围和信托责任。因此，Aas v Benham中采用的试验应予以取消。相反，据认为，董事在担任公司董事期间就知道有机会获得该财产。因此，基于事实，无利润规则是适用的，董事在对机会采取行动时触发了无冲突规则。因此，下级法院的裁决被推翻。
Based on the decision in O’Donnell, it is evident that the Court of Appeal declined to refer to test of business line for the scope of corporate opportunity. It was commented the test is difficult to determine the company’s business line and it would further defer the directors from gaining the opportunity. Referring to the approach in Bhullar, it does not form flexibility in determining the scope of opportunity but in fact it was a ‘stricter version of the line of business test’. This is because the defendants in Bhullar were a mere passer-by when they come across the opportunity. Furthermore the opportunity to purchase the land was not presented to the company. The company was neither interested nor pursuing the property especially since the directors have decided to part ways thus the company has no legitimate interest with the opportunity. The business line test has compelled to limit the self-interest of the director by considering all opportunity as commercially attractive to preclude from the director from exploiting it. It would not make sense as now opportunity are not only confined to the company’s current business line but to encompass what it would be interested in the future. As such this is a grey area that was left unresolved as opposed to the certainty in the strict approach.
vii. Avoiding Conflict of Interest 避免利益冲突
Given the nature of the law, it is clear that director will be caught under Sc 175 if he had appropriated any opportunity. The basic preposition in Regal/Boardman has been reaffirm under Sc 175(2) where it states that ‘it is immaterial whether the company could take advantage of the property, information or opportunity’. Going back to the assessment, director cannot escape Sc 175 by virtue that a fiduciary is required to ‘serve his master with good faith and fidelity’. This formulation was argued by Worthington as ‘an orthodox fashion’  as the CA has not provided basic guideline of whether the opportunity is rightfully belonging to the company.
Nevertheless, the harsh effects of the rules are mitigated with the introduction of Sc 175(4). It is not within the essay to discussed on how to escape liability but the only way the director could exploit the opportunity if the situation cannot be regarded to give rise to a conflict or alternatively the matter has been given authorization by the company.
(a) Sc 175 (4)(a)
Firstly, Sc 175 (4)(a) requires the element of reasonableness to decide whether there is conflict. Generally it provides an alternate answer to Sc 175(2) whereby if the director could usurp opportunity in their private capacity. This provision has used the similar phrase used by Lord Upjohn thus it has been suggested that this provision has referred to the scope of business test. It appears that the law has codified both the majority and dissenting decision in Boardman where Sc 172(2) embraces the duty to avoid conflict and Sc 175(4)(a) provides situation that is unlikely to consider a conflict of interest. Thus Sc 712(4)(a) is an ideal struck of balance between the strict and flexible rule because the court could adopt a broad or a wide view in defining opportunity as whether it fall within the business line.
首先，第175（4）（a）条要求合理性要素来决定是否存在冲突。一般来说，它提供了对Sc 175（2）的另一种回答，即董事是否可以以其私人身份篡夺机会。本条款使用了厄普约翰勋爵使用的类似短语，因此有人认为本条款提及了业务测试范围。法律似乎已经编纂了《博德曼法案》中的多数裁决和异议裁决，其中第172（2）条包含避免冲突的义务，第175（4）（a）条规定了不太可能考虑利益冲突的情况。因此，Sc 712（4）（a）是在严格规则和灵活规则之间取得平衡的理想选择，因为法院可以采取广泛或宽泛的观点来定义机会是否属于业务范围
However the lack of clarity begs the question of whether under Sc 175 (4)(a) would applies after the company’s unbiased rejection. Brenda viewed that Sc 175 (4)(a) was negatively expressed because it fails to clarify what circumstances that would qualifies under this provision. Indeed only certain situation allows one to reasonably decide if there is a rise of conflict. For instance if the company’s articles of association has provides an exemption clauses to address situation of conflict of interest. Brudney and Clark had commented that the element of impossibility in the test would ultimately lead to ‘an inevitable results will be to permit the diversion’. This is especially so when the court needs to ascertain company’s line of business, which is wide and could stretched to the future scope of the business.
Alternatively Lim has suggested that directors could exploit the opportunity from the time of the company’s rejection. He illustrated this point with the reference to Peso case and argued that the reason why the court was convinced that there is no exploitation because the company has formally authorized the rejection and the interested directors had only took up the opportunity in a reasonable time after the company’s rejection. By virtue of this, it can be suggested that a director must mitigate all consideration such as whether the company has given actual authorization where one would perceive to be reasonable possibility of conflict before taking the opportunity. However it is unclear whether Lim’s suggestion can be a mere speculation as there are no current attempts and authorities to clarify Sc 175 (4)(a).
(b) Sc 175(4)(b):Authorization
Moving on to Sc 175(4)(b), one could pursue the corporate opportunity if he has obtained the board authorization. Contrasting this with Sc 175(4)(a) where the issue of clarity has yet to be attempted in UK, Sc 175(4)(b) embodies the common law approach for company approval that there is no breach of conflict of duty. Thus it has been commented that Sc 175(4)(b) is arguably the better exception as it provides certainty to act as an effective the defense mechanism to avoid conflict of interest.
Prior to CA, the importance of gaining authorization was explained in Bhullar that ‘the existence of the opportunity was information which it was relevant for the company to know, and it follows that the appellants were under a duty to communicate to the company’. The common law has implied that the failure to inform the company about the opportunity is a breach of duty. As explained by Armour that the rule of conflict interest does not concern on returning the profits to its entitlement but rather it encourage the responsibility of disclosure. In light of this the preposition for authorization under Sc 175(4)(b) impose that the director is under a duty to disclose his conduct to the company. Such was the position in Fassihi, where the Court of Appeal held that the managing director was under a positive duty to disclose the benefits deriving from the opportunity. The failure to disclose would amounts to a conflict of interest.
Under this provision directors could avoid conflict of interest by gaining authorization from the board. It is highlighted that it is a loose term to attach the director for a duty to disclose the interest. This is true as the purpose of disclosure is not for the director to relief himself from the liability, but to prevent the abuse of trust vested upon them. Thus maintaining the ‘integrity of trusting relationship’ is the source of obligation. Likewise the claim on conflict of interest against Theo Paphitis was dropped because the boards were fully aware and given the authorization before he could engage on the opportunity in purchasing La Senza.
It is highlighted that the concept of authorization works differently for private and public company. In the case of private company, the article of association could either permit or refused to grant authorization. If it is former, the director could gain authorization of the conflicted matter.
As for public company, Sc 175(6) provides that a simple majority is required to authorize the conflict matter. Firstly, its article of association must expressly allow the directors to access to the opportunity. The next phrase involving the voting procedure where interested directors are not allowed to vote on the conflicted matter. It is caution that the meaning of ‘interested director’ is not provided; nevertheless it is safe to assume that it is referring to the director who is actively interested to purse the conflicted matter. Such was the approached in Regal whereby the court held that the authorization by the directors is not valid as it was the fiduciary themselves who have authorized the opportunity to acquired Amalgamated shares. This would act as a safeguard because there is a risk of gaining approval from the board. As highlighted by Gower that there is an underlying interest in a culture of easy conflict approval’. There is a risk of collusion amongst the directors who happens to share a close relationship with the interested directors. This could seen in Enron where the board of directors have approved a number of proposals for its Chief Financial Officer to acquired the opportunity on behalf of the company and profited at the company’s expense. This is to remind and alert the directors who are voting that they are subjected to a duty to act in the best interest of the company and personal benefits should be avoided.
Another issue arouse as to whether authorization from the shareholders are more appropriate. It was provided in Regal where the judges had referred to Lord Russell that acquiring votes from shareholders would constitute a valid authorization. Perhaps this is because the voting procedure would pose a limitation especially to a sole proprietor company. As seen in Goldtrail Travel Ltd v Aydin where the court held that the director is unable to acquire the opportunity by virtue of SC 175(6) as he is the sole proprietor of the said company. Despite that it is unclear whether the common law position will be referred. Furthermore it was submitted by the Company Law Review Steering Group (CLRSG) that getting the authorization from the shareholders should be avoided as it is against the idea that the board of directors making decision for the company. This was supported by Enriques and others who voiced that this can reduce cost of having a annual meeting which is also time consuming as the process involving the discussion would put the opportunity at the risk of lost.
另一个问题是股东授权是否更合适。《富豪》中规定，法官曾向罗素勋爵提及，从股东那里获得投票权将构成有效授权。也许这是因为投票程序会造成限制，特别是对独资公司。如Goldtrail Travel Ltd v Aydin案中所述，法院认为，由于董事是该公司的独资经营者，因此根据SC 175（6）的规定，董事无法获得该机会。尽管如此，仍不清楚是否会提及普通法立场。此外，公司法审查指导小组（CLRSG）提出，应避免获得股东的授权，因为这与董事会为公司决策的想法背道而驰。Enriques和其他人对此表示支持，他们表示，这可以降低召开年会的成本，这也是一项耗时的工作，因为讨论过程可能会失去机会。
Even with the codification of director’s duties under the CA, the common law approach will be largely influential in guiding the court to determine if there is a conflict of interest should the director acted upon the opportunity. Despite there are attempts to narrow down the interpretation of opportunity, nevertheless the codification of the CA has endorsed the strict approach taken in Regal/Boardman. Perhaps this is driven with the fear that director, as trustee would abuse their position for their personal interest. Thus the strict formulation is necessary ‘to maintain its vigour in the new setting.‘
However it should be noted that the decision in Regal and Boardman were prompted by the fact where it was difficult to ascertain the intention of the directors. In this sense, the significant in Regal/Boardman cannot be justified in this modern context. Hence to mitigate this vigor, the CA has acknowledged that directors are allowed to act on the opportunity only if there is authorization. In doing so, it has clarified that a corporate opportunity is available to the directors.
MBA Essay范文提到应注意的是，Regal和Boardman的决定是由于难以确定董事的意图。从这个意义上讲，富豪/董事会成员的重要性在现代背景下是不合理的。因此，为了缓解这种活力，CA已经承认，只有在获得授权的情况下，董事才可以根据机会行事。在这样做的过程中，它澄清了董事可以获得公司机会。本站提供各国MBA Essay代写或指导服务，如有需要可咨询本平台。