Directors who circulate a prospectus containing statements which they know to be false, with intent to induce any person to become a shareholder, may be prosecuted under § 84 of the Larceny Act 1861. They are also liable criminally for falsification of the company’s books, and for this or any other criminal offence the court in winding up may, on the application of the liquidator, direct a prosecution. As to the liability of directors for statements or omissions in a prospectus see [Company].
In managing the affairs of the company directors must meet together and act as a body, for the company is entitled to their collective wisdom in council assembled. Board meetings are held at such intervals as the directors think expedient. Notice of the meeting must be given to all directors who are within reach, but the notice need not specify the particular business to be transacted. The articles usually fix, or give the directors power to fix, what number shall constitute a quorum for a board meeting. They also empower the directors to elect a chairman of the board. The directors exercise their powers by a resolution of the board which is recorded in the directors’ minute-book.
The court will not as a rule interfere with the discretion of directors honestly exercised in the management of the affairs of the company. The directors have prima facie the confidence of the shareholders, and it is not for the court to say that such confidence is misplaced. If the stockholders are dissatisfied with the management the remedy is in their own hands—they can call a meeting and elect a new board.
A company’s articles usually provide for the payment of a certain sum to each director for his services during the year. When this is the case it is an authority to the directors to pay themselves the amount of such remuneration. The remuneration, unless otherwise expressly provided, covers all expenses incidental to the directors’ duties. A director, for instance, cannot claim to be paid in addition to his fixed remuneration his travelling expenses for attending board meetings.
When a company winds up, the directors’ powers of management come to an end. Their agency is superseded in favour of that of the liquidator.
(E. Ma.)
DIRECTORY, a term meaning literally that which guides or directs, and so applied to a book or set of rules giving directions for public worship. The directorium or ordo of the Roman Church contains regulations as to the Mass and office to be used on each day throughout the year, and the word is found in the Directory for the Publick Worship of God drawn up in 1644 at the Westminster Assembly. The term now usually signifies a book containing the names, addresses and occupations, &c. of the inhabitants of a town or district, or of a similar list of the users of a telephone supply, or of the members of a particular profession or trade. The name Directoire or Directory was given to the body which held the executive power in France from October 1795 until November 1799 (see [French Revolution]).
DIRGE, a song or hymn of mourning, particularly one sung at funerals or at a Service in commemoration of the dead. It is derived from the first word of the antiphon ”Dirige, Domine, Deus meus, in conspectu tuo viam meam” (Guide, O Lord, my God, my way in Thy sight), of the opening psalm in the office for the dead in the Roman Church. The antiphon is adapted from verse 8 of Psalm v.