| As a securities misrepresentation case involves many parties,the special status of independent directors is not paid enough attention to in the Securities Law.In order to implement the principle of protection of investors,information disclosure obligors including independent directors are generally assumed tort liability for losses based on the joint and several liabilities under the principle of presumption of fault.Starting from the nature of securities misrepresentation liability,this article summarizes the historical content of relevant legal norms governing independent director,takes the status quo of the performance of duties by independent directors in China as the starting point,and applies the system logic of independent directors to analyze and evaluate the fault standard and liability form of independent directors.That the liability for securities misrepresentation is a kind of tort liability is further affirmed after the promulgation of the Regulations on Misrepresentation.Over the past twenty years since the introduction of independent director in China,there are still some practical problems such as lack of independence,excessive information barriers and insufficient investment of time and efforts.With the gradual consolidation of the civil liabilities for tort of misrepresentation,independent directors find that the risks of civil joint and several liabilities they face may number in the hundreds of millions,and the practical tacit understanding characterized by low investment,low return and low responsibility is completely broken.The principle of imputation is the fault presumption,and the key to determine whether there is fault lies in whether the independent director has performed the duty of diligence.The institutional logic of the independent director is to improve the structure of the board of directors,reduce agency costs,urge agents to exercise their due diligence,guide the sound development of the company and protect the investors at large by introducing independent directors as external supervision.The establishment of diligence obligation should also be punished from its institutional logic,focusing on the supervision function.Under the law,independent directors were also endowed with the decision-making function of general directors,but this function is not relevant to the determination of fault for misrepresentation,so it should not be included in the scope of investigation.Therefore,the diligence obligation of independent directors is distinguished from that of general directors.The description of the duty of diligence of the independent directors in the existing judgments implicitly assumes that if such duty of diligence is exercised,misrepresentation should be detected.In the course of proving due diligence,the judgment excessively relied on such formal indicators as administrative punishment and signatures on disclosed materials and relegated the direct evidence proving due diligence to an auxiliary position in reasoning,which have the order reversed.Administrative penalty is different from the fault in civil tort,and they cannot be viewed on an equal footing.The logical relationship between the act of signature and the fulfillment of due diligence is neither sufficient nor necessary.Article 16 of the new Regulations on Misrepresentation lists four circumstances under which an independent director acts with due diligence,thus developing the duty of diligence from the perspective of fault:first,an independent director may rely on remedial acts to perform his duty of due diligence after the risk of misrepresentation arises.Second,an independent director may perform his duty of due diligence towards a regulatory authority.Thirdly,the principle of reasonable belief has been introduced conditionally.After considering this new trend of diligence duty and the existing extra-territorial diligence standards,a three-level model of diligence standard can be established:firstly,the institutional purpose level,which judges whether the independent directors have achieved the institutional purpose through performing their duties,if so,they are considered to have fulfilled their diligence duty,otherwise,they enter the objective standard level to judge whether they have fulfilled the most basic threshold of work obligation,if not,they are judged to be at fault.Instead,it enters the subjective standard level,where the duty of diligence is judged by the standard of an average professional of the same level of competence,over the same period of time,with the same access to information and the same incentive rewards.From the perspective of liability form,the mechanical application of joint and several liability is difficult to reach the substantial justice of consistent power and responsibility,and does not match with the status of independent directors as outside directors.Misrepresentation falls into the category of commercial tort,and joint and several liability tends to be applied in the field of commercial tort to implement risk internalization system.However,since this is not a substantial reason for the application of independent directors,holding them jointly and severally liable will not help to achieve the objective of improving the system of revolving liability,accountability by deep pockets and internal personnel.In practice,the adjudicator,out of the consideration of easing the joint and several liability of independent directors,proposed a new liability form of first allocating the total loss of misrepresentation according to the degree of fault,and then requiring the independent directors to bear joint and several liability with the listed company.Because this kind of liability form is not in the existing tort liability form,it is prone to produce the risk of inconsistency with the existing liability form.Another way is to adopt supplementary liability.Another feasible path is to adopt supplementary liability to mitigate the liability of independent directors from the interpretative perspective by incorporating the supplementary liability into the scope of the concept of joint and several liability and substituting the broad concept of joint and several liability into Article 85 of the Securities Law.Finally,the subjective mindset may be incorporated into the liability allocation assessment system,threshold rules may be introduced,and the independent directors may be subject to the maximum liability limits to improve the liabilities of independent directors. |
