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Buachaill
Buachaill, Barrister
Category: Law
Satisfied Customers: 10534
Experience:  Barrister 17 years experience
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How long does the fiduciary responsibility of a Managing Director

Customer Question

How long does the fiduciary responsibility of a Managing Director continue after he has left the company?
Submitted: 1 year ago.
Category: Law
Expert:  Buachaill replied 1 year ago.
1. There is no exact time limit when the fiduciary responsibility of a Managing Director ceases to exist to a company he has left, except to say that he cannot be sued six years after he left. So there is a long stop after six years and no action can be taken then. Otherwise, within the six year period, it is a question as to whether there is a conflict between his original duties as Managing director and the new interests he pursues. Depending on the nature of the duty or interest infringed the courts will find a fiduciary breach even three years after leaving. But, definitively, after six years no action is possible.
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Customer: replied 1 year ago.
I was very pleased with the answer, thanks. I now have evidence that the MD was speaking with at least one supplier some days before he had left the company and various clients within a month after leaving. He had been fairly useless as an MD for the previous 6 months and served his 3 months notice period (he resigned). Presumably I am entitled to claim his salary back (as a minimum) and expenses? What would I be entitled to claim?
Expert:  Buachaill replied 1 year ago.
2. Damages are not assessed on the basis of claiming back a former salary. Instead damages are assessed on the basis of the harm caused by the breach of fiduciary duty. Here, you would be able to claim damages for the soliciting of clients and also any consequential losses, such as in respect of any business which migrates or any damage to the goodwill of your company.

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