Tue, Sep 27, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Other Voices - Should indemnity provisions extend to auditors?

Thursday, September 02, 2010

This article was authored by Alric Lindsay, a Cayman-based independent director, who prior to his experience working as an investment funds attorney for two global law firms, was a senior compliance analyst with the Cayman Islands Monetary Authority:

Indemnity provisions are prevalent in the articles of association of Cayman domiciled investment funds. Such provisions may exonerate a director and/or officer from personal liability or restrict the persons who can be sued, however, the writer queries whether the terms should also apply to auditors.

The application to auditors, as discussed in various cases, may depend upon how the draftsman prepares the articles of association of a company and how the Cayman courts interpret the same. For example, there are some instances where the wording refers to every director and officer of the company as an "indemnified person". However, where it is not stated that the auditor is not an officer, it might be implied from the articles that the auditor is an officer.

Other draftsmen include express statements that "for the avoidance of doubt, "officer" does not include the auditors of the company". Presumably, the approach will vary depending on what is intended in each case.

To understand how some of the highest courts may read the clause, it is helpful to look at one of the well-known Privy Council decisions which addressed indemnity provisions. In Viscount......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Nobel Sustainability Trust, Prince Albert II of Monaco help launch major new initiative to drive sustainable technologies[more]

    Matthias Knab, Opalesque: The Nobel Sustainability® Trust ("NST") is leading a major new initiative to finance, incubate and accelerate the development of clean technologies. The initiative will start with the formation of the Nobel Sustainability Fund® ("NSF"). NSF will drive faster access t

  2. Studies - Hedge funds’ study reveals vast disparity in types of investors securing side letter arrangements, Cambridge: Look to private investments for best access to LatAm growth[more]

    Hedge funds’ study reveals vast disparity in types of investors securing side letter arrangements A new study of the hedge fund space by industry law firm Seward & Kissel LLP reveals a wealth of information regarding established hedge fund managers’ use of side letters—special agreements

  3. Activist News - Caesars 'optimistic' on deal with hedge fund creditors[more]

    From Reuters.com: Caesars Entertainment Corp said on Monday it remains "optimistic" of reaching a $5 billion deal with the bulk of its creditors to push its main operating unit out of bankruptcy, but one hedge fund bondholder said it will pursue litigation. Caesars offered a sweetened $5 billion set

  4. Hedge funds recover from losses as central banks give markets a respite[more]

    Komfie Manalo, Opalesque Asia: The Lyxor Hedge Fund index was up 0.4% from the week ending September 20 (-2.4% YTD), supported by the willingness of central banks to remain accommodative, Lyxor Asset Management said in its weekly briefing. It ad

  5. Perry Capital closing flagship fund after almost three decades[more]

    From Blooomberg.com: Richard Perry, one of the biggest names in hedge funds, is calling it quits after 28 years. Perry, 61, is winding down his New York-based flagship fund as the industry confronts one of the most tumultuous periods in its history. In a letter to investors Monday, he said his style