Chevalier T Thomas Elizabeth College For Women

Ms. J. GAYATHIRI,

Assistant Professor,

Department of Commerce

A director is one of those persons, who

are responsible for directing, governing

and controlling the policy or

management of a company. All directors

collectively are called as Board of

Directors or Board. They are the brains

of the company

The liability of directors may be discussed

under the following these heads:

➢ Liability to third parties

➢ Liability to the company

➢ Liability for breach of statutory duties

➢ Liability for acts of his co-directors

➢ Unlimited liability

LIABILITY TO THIRD PARTIES

In a limited company, the liability of the directors or of any

director or manager may, if so provided by the memorandum, be

unlimited. In a limited company in which the liability of a director

or manager is unlimited, the directors and the manager of the

company, and the member who proposes a person for appointment

to the office of director or manager, shall add to that proposal a

statement that the liability of the person holding that office will be

unlimited; and before the person accepts the office or acts therein,

notice in writing that his liability will be unlimited, shall be given

to him by the following or one of the following persons, namely,

the promoters of the company, its directors, or manager, if any, and

its officers.

Company Law – N.D. Kapoor

www.lawtimesjournal.com

www.legalservicesindia.com

http://www.preservearticles.com