The Determination Of The Liability Of The Controlling Shareholder For Breach Of Fiduciary Duty And Its Perfection

The controlling shareholder shall bear corresponding liabilities for breach of the fiduciary duty.Under the framework of the capital majority principle,the controlling shareholder enjoys control of the company based on majority voting rights.Because of the divergence of interests,the controlling shareholder may use control to infringe the interests of the company or other shareholders for the benefit of the private.If the company becomes a representative of the individual will of the controlling shareholder,the controlling shareholder can infringe the interests of the company and other shareholders through corporate activities.Such as the use of company resolutions,the use of board powers to harm the interests of the company or other shareholders.Therefore,violations of the fiduciary duty have various forms.And so many actions should be regulated by the fiduciary duty and the responsibility of breach of fiduciary duty.Therefore,on the basis of giving the controlling shareholder fiduciary duty,the responsibility of the controlling shareholder should be improved to rectify the disadvantages of the capital majority principle and protect the interests of minority shareholders and companies.By examining the status quo of the liability of the controlling shareholder for breach of fiduciary duty,various phenomena all reflect the dilemma of liability determination and legal regulation.With regard to the determination of liability,through the summary and analysis of the cases in which the controlling shareholder infringed the interests of the company or other shareholders in the past year,it can be found that due to the unknown nature of the liability,the application of law is confusing and proof rules is unclear when the court determining the controlling shareholder’s liability for breach of fiduciary duty.The application of law is confusing.The primary dilemma of legal regulation lies in the lack of liability forms for breach of fiduciary duty stipulated in the current company law,which cannot meet the needs of judicial rulings for effective blame of controlling shareholders.Secondly,the form of liability for breach of fiduciary duty provided by the current company law norms cannot meet the needs of judicial rulings for effective attribution of controlling shareholders.The key to solving the dilemma of liability determination is to characterize the controlling shareholder’s liability for breach of fiduciary duty.Regarding the nature of the liability for breach of fiduciary duty,there are breach of liability,tort liability,and statutory liability.According to the purpose and function of the controlling shareholder’s liability for breach of fiduciary duty,its essence should be statutory liability.However,the company law is too general and needs to be supplemented by the content of the tort liability law.Therefore,the liability for breach of fiduciary duty is determined to be a statutory liability that based on the tort liability.On this basis,when the controlling shareholder’s liability for breach of credit is determined,the company law norms should be applied preferentially,supplemented by the tort liability law.At the same time,the constituent elements of tort liability shall be used for reference to clarify the object of certification and the burden of proof.Regarding the legal regulatory dilemma of the controlling shareholder’s liability for breach of fiduciary duty,the fundamental way is to improve the system.From the perspective of perfecting the system,first of all,at the level of company law,the principle of the honesty obligations of the controlling shareholder and the liability for breach of fiduciary duty should be stipulated in principle,the common provisions for breach of fiduciary duty should be enumerated,and the form of liability should be expanded.Second,the current provisions should be improved through judicial interpretation.Specifically,common violations of the obligation of fiduciary duty include illegal appropriation or appropriation of company assets and unfair related transactions.And the forms of liability that our company law should expand include confiscation of illegal income to the company,joint liability under compulsory dividend distribution,and cessation of breach of fiduciary duty.