Samsung Semiconductor Europe Ltd v Docherty 2011 CSOH 32

Mr Docherty was ordered to account for profits derived from his interest in a company that had provided Samsung with quality control services.  Unknown to Samsung, Mr Docherty had secretly held a 50% shareholding in the company.  He had to repay €340,808 which he had received from the company by way of salary, share of profit and payment of shares for several years.   

Mr Docherty was not a director only a manager but he held a key position with significant responsibility and he was in a position to influence Samsung’s decision about not using the company’s competitors.  The effect of this was that Mr Docherty owed a fiduciary duty to Samsung.  It did not matter that Samsung did not expressly inform Mr Docherty that he owed it a fiduciary duty or suffer a loss.   

Key point:  The case demonstrates that an employee does not have to be a director to owe a fiduciary duty.  It did not matter that there was no detriment to Samsung in this case.  Following the Fishel case the existence of a fiduciary duty and potential conflict was sufficient to establish a duty to account.