Ciban Management Corpn v Citco (BVI) Ltd

Subject Matter

COMPANY — Director — Duty of care — Defendants engaged as registered agent and as sole director of British Virgin Islands shelf company — Company’s sole beneficial owner running company whilst maintaining anonymity by using business associate to issue instructions to defendants — Defendants acting on owner’s instructions issued by associate over two-year period — Defendants selling company’s assets on further instructions of associate given without owner’s knowledge or assent — Company claiming damages from defendants for negligence in failing to ensure associate had owner’s authority to procure sale — Whether defendants under duty to inquire where owner having set up and used system based on associate issuing “execution only” instructions to defendants — Whether owner having given ostensible authority to associate making latter’s instructions binding on owner as act of company itself

[2020] UKPC 21; [2021] AC 122; [2020] 3 WLR 705; [2021] 1 All ER 983; [2021] 1 All ER (Comm) 1; [2020] 2 BCLC 405; [2020] WLR (D) 504, PC

Commentary

RPC Perspectives
Hidden owners, ostensible authority and the Duomatic principle Case comment