This (on-going) case concerns a challenge by shareholders of Lloyds Banking Group against the bank's directors for alleged breaches of duties, the shareholders say were owed to them. 

The directors of the bank gave advice and information to its shareholders about a proposed acquisition and capitalisation of another bank, to help them decide whether to vote for the acquisition.

The courts have historically held that directors' duties are owed to their company, and not to the company's shareholders.  No fiduciary duty was found to apply here, but the High Court has helpfully summarised some of the duties that directors do owe to their shareholders, such as a duty to provide them with sufficient information to enable them to make an informed decision as to how to vote when directors seek a shareholders approval for a particular course of action.

The High Court also confirmed that directors can owe a fiduciary duty to promote the best interests of a shareholder where there is a special relationship between the director and the shareholder, and one which gives rise to special trust and confidence being placed in the director.

Lessons?

The Courtdidfind that there was a duty to ensure information provided to shareholders was not misleading and was clear and comprehensible, and not to hide material information.

The Case? Sharp and others v Blank and others [2015] EWHC 3220