Liability Of Directors Of The Legal System

Extending of Director authority represents the trend of Modern company development. With the market exchange growing rapidly, it needs the leading status of Director improved, if the company would do efficiently. Extending of Director authority will make for the development of company, but the extending in excess will lead to the power abused and the parties damaged without the system of balance. In order to protect the profit of shareholder, creditor and public bitterly, it should limit the Director authority and Director liability according to the law, which reflects some balance. In our company law, the rules related to Director and liability is very general and difficult for using, and the legislation of the system of Director liability insurance is void. So it is necessary to do some research on the theory of Director and Director liability, it will be helpful for the improvement of Company legislation. This study focus on the research of Director liability and demonstrate the definition, the legal status, power and obligation of Director, Director liability and its insurance. Furthermore, it also put forward some suggestion of improvement of our company law.There are five parts to discuss the system of Director liability in this thesis.Part one the definition of DirectorIt is necessary to clarify the definition of Director before studying the Director liability. The definition of Director reflects the relationship between Director authority and Director liability.Part two Clarification for the legal status of DirectorRights and obligation always exist as the content of some legal relationship. Such relationship which means the legal status of Director is the basement of the rights, obligation and liability of Director. There are many views on it and become the foundation of my comparing and analysis. On base of these views, I put forward some idea and suggestion for the legal status of Director.Part three Director authority and obligationDirector authority and obligation is the basement of Director liability discussed. The clarification of Director authority will be helpful for understanding the origin of Director liability. This part is very important for demonstrating Director liability. It including the following content: the origin of Director authority, the relationship between Director authority and company power and the scope of Director authority Moreover this part also introduce the two essential Director obligation and give some suggestion for domestic legislation.Part four Director liabilityThis part is the emphasis of the study. Firstly, it clarify that relationship between obligation and liability. Secondly, it classify the Director liability as for company and the third party. Finally, it also demonstrate the system of Director liability including the character, the constitution , the implementing and exception of it. On the base ofabove demonstrating, the idea and suggestion related to improvement of establishing the Director liability, had been put forward.Part five Director liability insuranceIn this part, some research on the risk of Director liability had been done. From the contrastive analysis of the international advanced legislation and the practice of our development, it clarify the necessary of Director liability insurance. Furthermore, the category and constitution of Director liability insurance had also been discussed.