Nov 2012
BRITISH VIRGIN ISLANDS
HIGH COURT (COMMERCIAL DIVISION)
INTERNATIONAL BUSINESS COMPANIES ORDINANCE – NATURE AND EXTENT OF DUTIES OWED BY PROFESSIONAL DIRECTOR APPOINTED BY FIDUCIARY SERVICE PROVIDER – SECTION 54(1) AND 80 OF THE INTERNATIONAL BUSINESS COMPANIES ORDINANCE
This case is noteworthy for the Commercial Judge’s treatment of the nature of duties owed to a Company by a professional director, Tortola Corporation Company Limited (“TCCL”). TCCL was appointed by Citco (BVI) Limited, a fiduciary service provider (“Citco”) as director of Spectacular Holdings Inc (“Spectacular”) (which merged with the Claimant). Spectacular was bought off the shelf from Citco by the sole beneficial owner. The sole beneficial owner wanted TCCL not to act otherwise than on his instructions. The Court felt that implicit in the relationship between the sole beneficial owner, TCCL was not required to and, indeed was not expected to, exercise any independent executive functions or discretion. TCCL was intended and engaged to be nothing more than the instrument through which the sole beneficial owner’s will could be given legal effect and that this division of responsibility between the sole beneficial owner of a company and its board was a: “perfectly lawful arrangement”.