Delegation not abdication: directors’
duties under scrutiny in syndicated loans

In syndicated lending it is common for lenders to delegate functions to an Agent and equally common for companies within a group to authorise the parent to act on their behalf. That has ramifications for the directors of the delegating companies – and for the directors of the delegate. This article, written by Helen Pugh, considers the issues which may arise.

A common feature of syndicated loans is the role of Agent and the delegation by
companies of functions in connection with the syndicated loans. In most cases, delegation will be a lawful and commercially pragmatic act. But there are pitfalls for the unsuspecting director who remains personally responsible for discharging his director’s duties to the company. Delegation should be thoroughly considered, suitably monitored and absent any actual conflict of interest.

Helen Pugh has written an article considering the issues which may arise. Read her full article here.

This article was first published in the April issue of Butterworths Journal of International Banking and Financial Law.

Find out more

Helen Pugh specialises in general commercial litigation, civil fraud, contentious insolvency and company law issues, and professional negligence.

Her practice has a strong international element with an expertise in jurisdictional disputes and conflict of law issues, including as they arise at an interim stage in applications for worldwide freezing orders and service out applications or on the substantive claim, and in the cross-border insolvency context.

To find out more, contact Matt Sale +44 (0)20 7427 4910 for a confidential discussion.

News 12 May, 2022