Mark Hsiao (City University of Hong Kong, School of Law) has posted Directors' Duty to Creditors: A Contractual Approach to Coherent Theory on SSRN. Here is the abstract:
The case of BTI v Sequana, highlights how an unclear undertaking theory of fiduciary duty can create inconsistencies between the codified duty of directors to promote the company's success and existing fiduciary case law. This paper argues that shareholders and the company have agreed, through a statutory contract, to prioritise creditors' rights, which does not conflict with directors' duties to the company. By examining two competing fiduciary theories, the paper clarifies that directors' duties can be seen as non-fiduciary. The thesis is that creditor duty and non-fiduciary duty under section 172 are incidences of the contractual nature of directors' duties.