The Irreducible Core of the Duty of Care, Skill and Diligence of Company Directors: Australian Securities and Investments Commission V Healey

26 Pages Posted: 2 Mar 2012  

John Lowry

University College London

Date Written: March 2012

Abstract

The decision in ASIC v Healey raises hitherto unexplored questions about the standard of care of non‐executive directors in monitoring the production of financial statements. More particularly, it considers the power of directors to delegate areas of responsibility requiring specialist knowledge and the degree of permissible reliance on professional advisers. The reasoning of the judge will doubtless prove helpful to the English courts not only in relation to duty of care issues under section 174 of the Companies Act 2006, but also when considering the duty to exercise independent judgment which is now restated in section 173.

Keywords: Directors, common law duties of care, skill and diligence, financial reporting

Suggested Citation

Lowry, John, The Irreducible Core of the Duty of Care, Skill and Diligence of Company Directors: Australian Securities and Investments Commission V Healey (March 2012). Modern Law Review, Vol. 75, No. 2, March 2012. Available at SSRN: https://ssrn.com/abstract=2014563 or http://dx.doi.org/10.1111/j.1468-2230.2012.00898.x

John Lowry (Contact Author)

University College London ( email )

Gower Street
London, WC1E 6BT
United Kingdom

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