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Company Law

Duties of promoters

In Chapter 7: The Promoters

Company Law

Ronan Keane
Bloomsbury Professional
Fourth edition
Publication Date:
January 2007
Law As Stated At:
1 September 2006
[7.04] Where the company is formed as a ‘one man company’, ie where all the shares are owned by the promoter and he also nominates the directors, the duties owed by the promoter are of little importance. Where there are other investors – and most importantly of all where the public is invited to subscribe – his duties are of more significance. It cannot be said that in Ireland the topic is of great practical importance, however, and its treatment here is correspondingly abridged. [7.05] The promoters of the company stand in a fiduciary position towards the company. Erlanger v New Sombrero Phosphate Co (1878) 3 App Cas 1218 at 1236 per Lord Cairns LC; Hopkins v Shannon Transport Systems Ltd (10 January 1972, unreported) HC. This means that the law regards promoters as being bound by certain obligations of trust which are not applicable to persons engaged in Emma ...
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