In re Lo-Line Electric Motors Ltd: 1988

When considering the filing of additional evidence changing allegations made under the 1986 Act, the paramount requirement is that the director facing disqualification must know the charge he has to meet. As to the standard of misbehaviour required to found an order, Sir Nicolas Browne-Wilkinson VC said: ‘Ordinary commercial misjudgment is in itself not sufficient to justify disqualification. In the normal case, the conduct complained of must display a lack of commercial probity, although I have no doubt in an extreme case of gross negligence or total incompetence disqualification could be appropriate.’ The director ‘has been shown to have behaved in a commercially culpable manner in trading through limited companies when he knew them to be insolvent and in using the unpaid Crown debts to finance such trading.’


Sir Nicolas Browne-Wilkinson VC


[1988] Ch 477, [1988] 2 All ER 692, [1988] BCLC 698, [1988] 3 WLR 26


Company Directors Disqualification Act 1986


England and Wales

Cited by:

CitedThe Secretary of State for Trade and Industry v Swan and Othes ChD 22-Jul-2003
When commencing proceedings under the Act, the papers were defective. The secretary of state had failed to give appropriate notice, and thus prevented him from making representations as to the allegations. The allegations involved the manipulation . .
CitedIn re Sevenoaks Stationers (Retail) Ltd CA 1990
The court gave guidelines for the periods of disqualification to be applied for company directors under the Act. The maximum period of ten years should be reserved for only the most serious of cases. Periods of two to five years should apply to . .
CitedDr Giuseppe Ruscill, Council for the Regulation of Health Care Professionals v The General Medical Council and Another, The Council for the Regulation of Health Care Profesionals, The Nursing and Midwifery Council, Truscott CA 20-Oct-2004
The Council sought to refer to the High Court decisions to acquit the doctors of professional misconduct. The doctors argued that the power only existed for lenient sentences.
Held: The power to refer for undue leniency included the situation . .
CitedSecretary of State for Business Innovation and Skills v Aaron and Others ChD 10-Dec-2009
The claimant sought a disqualification after the defendants had been directors of a company mis-selling Structured Capital at Risk products. The FSA had reported that they had been negligent.
Held: ‘I do not have to decide whether or not the . .
CitedCathie and Another v Secretary of State for Business, Innovation and Skills CA 1-Jun-2012
The directors appealed against disqualification orders made against them under the 1986 Act. Their company had become insolvent, owing substantial arrears of PAYE and NI contributions. The revenue had said that they had paid other creditors first. . .
CitedHolland v Revenue and Customs and Another SC 24-Nov-2010
The Revenue sought an order under section 212 of the 1986 Act, for payment of the tax debts of the insolvent company by a de facto director. H had organised a scheme under which IT contractors had worked through companies created by him under a . .
Lists of cited by and citing cases may be incomplete.


Updated: 06 May 2022; Ref: scu.185770