1.4. Duty to exercise reasonable care, skill and diligence (section 174)
A director must exercise the care, skill and diligence which would be exercised by a reasonably diligent person with both:
• The general knowledge, skill and experience that may reasonably be expected of a person carrying out the functions carried out by the director in relation to the company (the "objective" test).
• The general knowledge, skill and experience that the director actually has (the "subjective" test).
So, at a minimum, you must display the knowledge, skill and experience set out in the objective test, but where you have specialist knowledge, the higher subjective standard must be met.
If you have any question on any of those matters, or on any of the matters covered below, whether now or in the future, you should contact David Heys at Lawson-West on 0116 212 1027 or by email at dheys@lawson-west.co.uk.
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