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Tortious Acts and Directors

Tan Cheng Han SC

(2011) 23 SAcLJ 816

The issue of when directors are jointly liable for the tortious acts of their companies can be a difficult one. On the one hand, an expansive approach to liability may affect the ability of companies to attract competent people to become directors. Yet setting the bar too high for director liability raises the question of whether directors are treated more favourably than other officers and employees of companies. It is suggested in this article that an appropriate balance can be reached by giving greater weight to the principle that directors must act bona fide in the best interests of the company. The law should be slow to impose joint liability on directors where they have purported to act in the best interests of their companies.