Please enable JavaScript.
Coggle requires JavaScript to display documents.
Disclosure of conflict of interest - Coggle Diagram
Disclosure of conflict of interest
Section 222
Prohibition on voting by interested directors at the board of directors' meeting
Only to make up the quorum;
Shall not participate in the discussion while it is being considered at the meeting
Shall not vote
Section 221
What circumstances where the duty to disclose arises?
S. 221 (1)
Direct Interest
YEO GEOK SENG V PP
Indirect Interest
Section 221 (9)
(a)the spouse of a director who is not a director of the company; or
Transvaal Lands Co v New Belgium Co
(b) a child, including adopted child or stepchild, of a director of a company who is not a director of the company, shall be treated as an interest in the contract and proposed contract.
The section DOES NOT state that these are the ONLY relationship where directors are deemed to be interested . Example : business partner
Holds an office [Multiple Directorship]
Exception:
If the director is a member/creditor of a corporation with the company that is not material interest s221(2)
Less than 5% of shares of the other company
Guarantor (Exception under 221 (3) (a))
Corporate Group (Exception under 221 (3) (b))
When and How disclosure is made?
Formal v Informal
Formal
Zung Zang Wood Products Sdn Bhd & Ors V Kwan Chee Hang Sdn Bhd & Ors
Informal
Genisys Integrated Engineers
UEM Group Bhd v Genisys
If all directors are aware, there is NO need for formal disclosure?
Yes
Tan Bok Seng
Woolworths Ltd v Kelly
Nope
Ultraframe (UK) Ltd v Fielding & Ors
Neptune (Vehicle Washing Equipment ) Ltd v Fitzgerald
As soon as possible
Multiple Directorship
Effect of contravention