A Bermudian law firm has highlighted its involvement in a Court of Appeal case that it said redefined the protections afforded to company directors in Bermuda.

Writing on its LinkedIn page, Marshall Diel & Myers Ltd said: “We are delighted to have acted in a significant case in the Court of Appeal of Bermuda that saw an important judgement handed down last week.”

The firm’s managing director, Katie Tornari, together with Graham Chapman, KC, of 4 New Square Chambers, acted for Walton Eddlestone, alleged to be a former company director of Global Distressed Alpha Capital I Limited.

The article said: “Traditionally, directors have been able to rely on the indemnity in a Bermuda company’s by-laws for the utmost protection from being sued where their conduct falls short of fraud or dishonesty. However, last year, the Court of Appeal opened up a route for shareholders, the company or liquidators to bring claims against a company’s directors under certain circumstances.

“Nevertheless, the Court of Appeal was of the view that GDACI’s amended Statement of Claim did not go far enough to fall within the carve out in the by-laws and it provided GDACI a further opportunity to make an application to re-amend its amended Statement of Claim to prevent its claim from being struck out.

“In a judgment handed down last week, the Court of Appeal dismissed GDACI’s application for leave to re-amend its Statement of Claim and criticised GDACI for failing to formulate its claim adequately to explain why, even on its latest iteration, it fell within the carve out in the by-laws and for the delay in pursuing its claim.

“Accordingly, in dismissing GDACI’s amendment application, the Court of Appeal upheld the finding at first instance that the proceedings be struck out.

“MDM are proud to have secured this crucial judgment for our client.”

For the full Court of Appeal decision, see “Related Media”

Download PDF File

114. GDACI v C. Herman W. Eddlestone - CoA judgment 10 Jul 2024.pdf