CPL Seminar: 'Should the Delaware Caremark Fiduciary Duty be Adopted as a UK Directorial Duty?'

Speaker: Weiming Tan, Lecturer, National University of Singapore

In the 21st century, laws are often not reinvented from scratch but are instead being transplanted. In contemporary company law, English judges and scholars have often conducted comparative analyses with Delaware law. An emerging view is that UK corporate regulation would be enhanced with the adoption of a Delaware Caremark-style duty. However, any legal transplantation must be sensitive to the context and needs of the recipient jurisdiction. Considering the UK’s statutory framework and equity landscape, this paper argues for a more nuanced adoption of the Caremark duty instead of a wholesale importation. English law should similarly recognise that directors owe a fiduciary duty of active oversight to the company. This duty ought to be a mandatory duty, but liability for its breach should not be scienter-based. It is further suggested that this duty should not be subsumed under existing provisions of the Companies Act 2006. In particular, ss 172 and 174 of the Act will be discussed to demonstrate why it would be inadequate to enforce the duty under both provisions. Finally, the proposed duty should only be owed by directors of the company and should not be extended to non-directorial officers within the company.

This seminar is open to all LLM, MCL and PhD students, Faculty members and Faculty visitors but is not open to undergraduate students.

If you have questions or are interested in speaking at a future CPLC event, please email privatelaw@law.cam.ac.uk