5/13/2011 Duty to act bona fide in the best interests of the company The interests of other constituencies? Subject to one exception,common law has not equated the company's interests with the interests of non-s/er constituencies Bowen L in Hutton v West Cork Railway Co.(1883)LR 23 Ch D 654,673:"the law does not say that there are to be no cakes and ale,but there are to be no cakes and ale except such as are required for the benefit of the co." 15 Duty to act bona fide in the best interests of the company The interests of other constituencies? S 309(1)of CA 1980:"the matters to which the directors of a co are to have regard in the performance of their functions include the interests of the co's employees,in general,as well as the interests of its members" It was later restated in s 309(1)of the CA 1985. How to read this? Does this clause say anything about in whose interests decisions should be made? Case law on directors'duties and creditors 6 85/13/2011 8 15 • The interests of other constituencies?  Subject to one exception, common law has not equated the company’s interests with the interests of non-s/er constituencies  Bowen LJ in Hutton v West Cork Railway Co. (1883) LR 23 Ch D 654, 673: “the law does not say that there are to be no cakes and ale, but there are to be no cakes and ale except such as are required for the benefit of the co.” Duty to act bona fide in the best interests of the company 16 • The interests of other constituencies?  S 309(1) of CA 1980: “the matters to which the directors of a co are to have regard in the performance of their functions include the interests of the co’s employees, in general, as well as the interests of its members”  It was later restated in s 309(1) of the CA 1985.  How to read this?  Does this clause say anything about in whose interests decisions should be made?  Case law on directors’ duties and creditors Duty to act bona fide in the best interests of the company