Holyaoke Industries (Vic) Pty Ltd v V-Flow Pty Ltd (2011)

The breach of fiduciaryduties by company directors and officers also arises when their actions conflicts against the interest of the company. It is also important to note that fiduciary duties do not end on the parameters of their contract. This means that officers and directors should not exploit any potential business they encounter because of their position.

Holyaoke Industries (Vic) Pty Ltd v V-Flow Pty Ltd (2011)

Case Facts:

Information was acquired by the managing director and the executives of Holyaoke that V-Flow, their competitor, was selling their business. The information obtained by the the managing director of Holyaoke while he was visiting the V-Flow about discussing the orders of Holyaoke. Also, the executives of Holyaoke were able to acquire the information when they were discussing with V-Flow the possibility of a merger.

With this information, the executives of Holyaoke acquired V-Flow without giving notice of their action. In addition, they acquired funds to buy V-Flow by saying that to the bank that this will aid the business of Holyaoke, and that they already informed the customers of Holyaoke about the shift in business.

After V-Flow was acquired by the executive officers, they all resigned from Holyaoke.

Case Decision:

The court decided that the executive officers breached their fiduciary duty because, even if they acquired the information after office hours, they were still obligated to carry out their fiduciary duties to the enterprise.