Corporations are run by their officers and directors, but are owned by their shareholders. Director’s liability can become an issue when a dispute arises over specific acts or failures of the company. Unfortunately it’s at this point that many directors learn that there are circumstances where he or she may be held personally liable.
In recent years there has been tremendous growth in the responsibilities and potential director’s liabilities, mainly due to the media’s attention on high-profile corporate governance cases and the ensuing changes in legislation. Directors are held to a very high standard in their actions in relation to a corporation. The following fiduciary duties form the foundation of their responsibilities:
- Duty of care – to act reasonably in the corporation’s best interest
- Duty of loyalty – to remain loyal to the company, placing its interests before your own
Beyond these basic duties, extensive provincial, federal and industry-specific statutory laws govern director’s liability. If you are a director of a corporation, it is crucial that you understand your fiduciary duties and the ramifications of director’s liability.
The business lawyers at Vancouver-based Hobbs Giroday have substantial experience in advising directors on their responsibilities and potential liability. We have litigated the full range of corporate governance issues from fiduciary duty and partnership disputes to securities litigation and shareholder disputes. We handle each case with the utmost goal of protecting you against the risks of your job.
If you require a partnership dispute lawyer or advice on your potential liability as a director, contact us for a consultation.