- Promoters are not the agent of the company.
- Promoters are not the trustees of the company.
- Promoters stand in a fiduciary relationship with the company and to its shareholders.
- Promoter should not make an affair or unreasonable use of his position.
In the words of lords Cairns, the promoter of a company stands undoubtedly in a fiduciary relationship. They have in their hand the creation, and molding of a company. they have the power of defining how and when and in what shape and under what supervision, it shall start into existence and begins to act as a trading corporation.
43 Comments