Introduction

The duty of care underwent historical evolution prior to the enactment of the Companies Act 2006, encompassing the use of both subjective and objective assessments[1]. This approach is supported by cases such as Brazil Rubber Plantations and Estates Limited and City Equitable Fire. Courts assess the conduct of directors by taking into account the standard of care expected from a reasonably competent individual in a comparable position (referred to as the objective element) and the knowledge possessed or reasonably expected to be possessed by the director in question (although this amalgamation of criteria occasionally introduces a subjective component)[2]. The paper will offer evolution that surge in duty of care from 1990 and its effect of perception of director’s duty towards employee or any other entity that may came under a director’s authority. Moreover, the common law in expanse of duty of care will also be highlighted to increase understanding of duty of care expected from the directors under UK legal referendum.

Historical overview of the development of duty of care

Before 20^th century the field of tort law observed a somewhat lower level of advancement, with negligence claims frequently being settled through individualized assessments. The notion of duty of care originated from overarching principles of common law and equity rather than being derived from explicit statutory restrictions. The 20th century marked a significant with numerous influential cases such as the case of Donoghue v. Stevenson.  The case of Anns v. Merton London City Council (1978) is a notable legal precedent in which the duty to exercise care also encompassed the handling of erroneous information.

The understanding regarding duty of care progresses throughout the years by involving significant societal aspects such as governance, business policies and social expectation such CSR (corporate social responsibility) along with business judgment rule that protect directors for their good faith. Robinson v. Chief Officer of West Yorkshire (2018) and Darnley v. Croydon Health Services NHS Trust (2018) are some of cases that changed dimension of duty of care in UK[3]. Duty of care is primary notion highlighted in common law which fur her linked with negligence of director’s explicitly. [4]Common law recommends the duty of care is not only legal binding that must practice by directors but every constituent of organization should practice the law to form coherence and prevent negligence. [5]The cases of Rubber Plantations Re Brazil & Estates Ltd. and Re City Equitable Fire Insurance Co. Ltd. demonstrate the importance of standard of care expected from directors.

[1] Aczel, Miriam R. “Public opposition to shale gas extraction in Algeria: Potential application of France’s ‘Duty of Care Act’.” The Extractive Industries and Society 7,  1360-1368.

[2]Stevens, Richard, and Philip De Beer. “The duty of care and skill, and reckless trading: remedies in flux?.” SA Mercantile Law Journal , 250-284.

[3]Darnley v. Croydon Health Services NHS Trust, 2018 U.K.S.C. 50 (2018).

[4] Ibid 1

[5]Piotto, Daniel, Kevin Flesher, Andrei CaíquePiresNunes, Samir Rolim, Mark Ashton, and FlorenciaMontagnini. “Restoration plantings of non-pioneer tree species in open fields, young secondary forests, and rubber plantations in Bahia, Brazil.” Forest Ecology and Management .