Tuesday 25 January 2022

UK: England and Wales: the 'nerve centre' and de facto directors

Mr Justice Edwin Johnson delivered judgment last week in Umbrella Care Ltd v Nisa & Ors [2022] EWHC 86 (Ch). Amongst the matters he considered was whether an individual was a de facto director of a company. 

I note his judgment here because it provides a further illustration of what we might call the 'nerve centre' test: was the individual the nerve centre, or one of the nerve centres, from which the activities of the company radiated?  As the trial judge noted - like HHJ Hodge before him in Ingram v Singh [2018] EWHC 1325 (Ch) - asking if an individual was part of the company's governance structure, an approach endorsed in Holland v HMRC [2010] UKSC 51, may be of less assistance in determining if they are a de facto director where the company's affairs have been conducted informally in the absence of any formal governance structure.

No comments: