Good Company Newsletter - July 2014
Welcome to the first edition of Good Company, brought to you by Fieldfisher's corporate team.
This publication aims to keep company directors and secretaries, in-house counsel and their professional advisers abreast of developments in company law and practice. We plan to publish it several times a year. It is a sister publication to Market reCap, which covers legal and regulatory developments affecting quoted companies: if you do not currently receive Market reCap, but would like to do so, please sign up here.
We believe you will find this useful. If, however, you would prefer not to receive future editions please click here.
Jonathan Brooks, Editor
Transparency and trust: seeing the way to reform
Proposals to increase transparency and trust in the UK business environment are taking shape following publication of the Government's response to its July 2013 consultation. A new, publicly accessible, central registry of beneficial ownership of companies and limited liability partnerships will be established, with individuals being required to disclose their interests and companies having to ascertain beneficial ownership of significant shareholdings. Bearer shares will be abolished. In addition, changes are proposed to tackle opaque corporate control resulting from the use of corporate and "front" directors and to update the directors' disqualification regime and provide redress for creditors.
Service of English legal proceedings on overseas directors
The High Court has recently decided that a director of a UK company who resides abroad can be served with English legal proceedings on any matter, whether or not relating to that company, if he has a UK service address noted at Companies House, without the need to comply with the usual requirements for service outside the jurisdiction.
Personal guarantees by directors
In a recent case, the Court of Appeal considered the validity of personal guarantees given by company directors to a bank in respect of the company's liabilities. The directors' arguments that the guarantees were conditional, and were not intended to be binding until the company had granted a debenture to the bank, were rejected.
Raising money under false pretences
The High Court has recently ordered a company director to pay damages to a new investor. The investor had relied on a private placement memorandum issued by the company, which failed to disclose that it intended to use the investment monies to discharge historic liabilities to the directors.
Holding company liability for health and safety
The Court of Appeal has recently overturned a County Court decision and confirmed that a group holding company was not liable to an employee of one of its subsidiaries who had contracted asbestosis.
Proper purpose test for access to register of members
The Court of Appeal has considered, for the first time, when the court should prevent access to a company's register of members on the grounds that the request for access is made for an improper purpose.
When not to be a de facto director
The Intellectual Property Enterprise Court (IPEC) has recently rejected a claim that certain individuals, who had made a patent application to protect an invention, were de facto directors of the claimant company. They could therefore not be in breach of fiduciary duties to the company in failing to make the patent application in the company's name. This post from SnIPpets, our Intellectual Property blog, discusses the case.
What’s new at Fieldfisher
- The London office of Fieldfisher has moved to new premises at Riverbank House, 2 Swan Lane, London EC4R 3TT. All our London employees are now housed in one building - a building with significantly better facilities and breathtaking panoramic views of London.
- We are proud and delighted that Fieldfisher tax partner Graeme Nuttall has been made an OBE in the Queen's Birthday Honours list in recognition of his work on employee ownership, employee share schemes and public service mutuals. - See more here.
- Fieldfisher is one of a small group of law firms to be awarded ISO 27001 Certification status. The internationally recognised standard will provide the most stringent certification for information security controls, guaranteeing that ample information security controls and other forms of risk treatment are in place to prevent and defend against potential data system vulnerabilities. The certification also ensures that the information security controls continue to meet the firm's security needs on an ongoing basis.