A UK dispute sheds light on the duties of a dissident director

A recent decision of the UK’s High Court — Stobart v Tinkler [2019] EWHC 258 (Comm) — has been released following a dispute between directors of a large infrastructure company (the “Company”). The decision, and the circumstances preceding it, serve as a cautionary tale about the duties of a dissident director and of board members in the context of proxy contests. The board dispute was initiated by a founder and significant shareholder of the company (the “Dissident Director”). After his resignation from the office of CEO in 2017, the Dissident Director remained with the Company as a director and employee.  Shortly thereafter his relationship with the rest of the board, and in particular with the board’s independent chairman, began to break down.  These tensions boiled over in the months leading up to the company’s 2018 AGM.  During this period the Dissident Director had numerous private discussions with…

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