The duty and liabiity of directors in financial difficulties

2016 Fiscal Year Final Research Report

• Project/Area Number: 24730079
• Research Category: Grant-in-Aid for Young Scientists (B)
• Allocation Type: Multi-year Fund
• Research Field: Civil law
• Research Institution: Kyoto University
• Principal Investigator: Saito Maki 京都大学, 法学研究科, 教授 (60324597)
• Project Period (FY): 2012-04-01 – 2017-03-31
• Keywords: 取締役 / 責任 / 経営悪化時

Outline of Final Research Achievements

The liability of directors for the third party, which is found in Art. 429 (1) of Japanese Company Act has functioned as one of the key elements of the creditors’ protection in Japanese Corporate Law. Yet case law has failed in offering a clear guideline to directors’ duty in a financial crisis, on the contrary, the court has often treated directors as if they were guarantors for the company’s debts. From a comparative perspective, it is worth to clarify directors’ duty in a financially distressed company from an insolvency law’s standpoint and to limit the scope of their liability considering that the profit and loss of the business of the company does not belong to them.

Free Research Field

法学