Directors who stand to receive a bonus or benefit (other than as a shareholder) only if a scheme proceeds should exercise caution in making recommendations and generally should not do so. However, where a benefit is not conditional on the scheme proceeding, no such concern arises. Where a director with a scheme-conditional benefit does join in a recommendation, the court will assess whether this warrants withholding approval by reference to disclosure, commercial rationale, the director's relative influence, and the overall shareholder vote. An exculpatory clause in a scheme of arrangement will be construed as not excluding liability for acts or omissions in breach of the scheme terms.
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