A mining company sued one of their directors for pounds 10,000, which they averred he had received from the persons from whom the company had purchased their mines, out of the price paid therefor, as an inducement to him to become a director, and to promote the formation of the company and the consequent purchase of the mines. The defender admitted that he had received pounds 10, 000 from the vendors, but averred that this sum was paid to him in terms of an agreement between him and the vendors, whereby he undertook to render various services to the company, when formed, outwith his duties as a director. These services he claimed to have actually rendered. There was no mention of any such agreement in the prospectus; none of the other directors were made aware of any such agreement; nor did they understand that the defender rendered any services to the except in his capacity of director.- Held (affirming judgment of Court of Session) that the defender was bound to repay the pounds 10,000 to the company.
Judges:
Lord Chancellor, Lord O’Hagan, Lord Blackburn, and Lord Gordon
Citations:
[1877] UKHL 217, 15 SLR 217
Links:
Jurisdiction:
Scotland
Company
Updated: 12 July 2022; Ref: scu.639645