On appeal from: [2009] EWCA Civ 625

Whether the director of a corporate director of a company can be a de facto director of the subject company and be held liable to repay the tax liability of that subject company under the Insolvency Act 1986, s 212; and the scope of any discretion under s 212 to reduce that liability. The Supreme Court (by a majority of 3 to 2) dismissed HMRC’s appeal. Whether a person is a de facto director is not simply a question of fact: the question was whether all of his acts can be attributed in law solely to the activities of the corporate director. The basis of liability for a de facto director is an assumption of responsibility and being part of the governing structure. Parliament has already intervened in the Companies Act 2006 to ensure that there is a natural person to whom responsibility is attributed. The further extension of the concept of de facto director contended for by HMRC is a matter for the legislature and not for the Supreme Court.

For judgment, please download: [2010] UKSC 51
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