OUTER HOUSE, COURT OF SESSION
 CSOH 67
OPINION OF LORD MALCOLM
in the cause
PARK'S OF HAMILTON (HOLDINGS) LTD
Pursuer: Sandison, Q.C.; Brodies LLP
Defender: Logan; Campbell Smith W.S. LLP
30 April 2013
 Until 30 November 2007, the pursuers and the defender were shareholders in LAGTA Ltd. The pursuers held 31.6% of the issued shares. The defender was the managing director of the company, and had 27.1% of the issued shares. Douglas Park, a director of the pursuers, was also a director of the company. The pursuers and the defender had, by some distance, the largest holdings in the company.
 In the first half of 2007 Valley Forge (UK) Ltd intimated an interest in acquiring LAGTA. The defender, as managing director, negotiated the resultant deal with the parent company of Valley Forge, namely SPX Corporation. The board of LAGTA agreed to sell the company for a total price of £5.2m, with the defender being paid £26 for each share held by him, and the other shareholders receiving £21.50 per share. The pursuers claim that they agreed to this differential on the basis of the defender's representation that it was remuneration for his agreeing to act as a consultant to the company after its acquisition by the purchasers. The pursuers claim that this representation was false, and that if they had known the true position, they would not have agreed to the premium. They seek damages from the defender for loss sustained as a result of his alleged fraudulent, or at least negligent, misrepresentation. Failing that, the pursuers have an alternative case based upon an alleged breach of the fiduciary obligations owed by the defender to, amongst others the pursuers, in respect of the benefit which he received from his remuneration as a consultant post acquisition.
 Evidence was led on behalf of both parties at a proof. All of the witnesses were labouring under the disadvantage of attempting to remember the detail of events occurring in 2007. In these circumstances I will begin by considering the terms of the relevant contemporary documentation. Thereafter I shall review the evidence given at the proof to see to what extent it supports, contradicts or adds to the picture obtained from the contemporary material.
 On 24 May 2007, on behalf of SPX, Robert Spence intimated to the defender an expression of interest in acquiring LAGTA, at an estimated gross purchase price of £4.75m. The defender reported this to the board on 13 June, attended by, amongst others, Mr Gerard Donnachie, who was representing the pursuers. The board decided to pursue the offer from SPX. It equated to a price of £20 per share. The consensus was that this was "a very good offer", and more than was likely to be achieved under any other option. (The board had received an intimation of interest in purchasing LAGTA from another organisation called Carter & Carter). The defender was instructed to contact SPX with a view to obtaining an increased offer.
 On 28 June the defender and Mr Cassells, of PKF, the company's accountants, met with Mr Spence and Claudia Berchtold of SPX at LAGTA's premises. Mr Cassells prepared a note of that meeting. The note is dated 10 July 2007 (production 7/15.6). Mr Cassells records that before the meeting he had a discussion with the defender, who
"thought that he could get £20 per share for the other shareholders and he could get an additional amount as compensation for the fact that he would need to take this forward and for work in the future for SPX".
Mr Cassells records that he said that he thought "it would be possible for us to get more for all shareholders and that the additional amount for (Mr Campbell) would be largely between him and the other shareholders". As to the discussion with the representatives of SPX, the note states that it was agreed that their initial offer was £4.75m gross. The sellers' counter proposal equated to £5.5m. Mr Spence proposed splitting the difference (earlier he had indicated that he had full authority to agree a price). At that point Mr Spence and Ms Berchtold left the room. The defender and Mr Cassells had "some fairly lengthy discussions".
"We performed some iterations based on the numbers available and various differences between the two share prices for the other shareholders and Colin Campbell were worked out. GIC (Mr Cassells) seemed to persuade CC (the defender) that the difference could not be as much as he was initially proposing and it seemed possible to get the shareholders up above the £20 per share to approximately £21.50 per share. However this did not give CC anywhere near what he wished per share and therefore he proposed asking for another £75,000".
The note records that SPX came back into the room and
"CC said that he thought he could persuade the other shareholders to do a deal if there was another £75,000 on the table and it was split £26 per share for Colin Campbell and £21.50 for the other shareholders. SPX accepted this and said that they would frame the proposal in this way. (NB. Even at this level CC still did not get the £1m he was wanting)."
Mr Cassells also records that, prior to discussing the numbers, the defender had asked SPX about the role that they saw for him after completion. They wished him to stay on, probably for a period of 18 months. The meeting concluded with the SPX representatives stating that they would have an offer letter drafted up on the basis of the above. The note indicates that there were various iterations of the revised offer letter until the final one was signed.
 The offer letter is dated 5 July 2007. It was signed by Mr Spence and addressed to the defender. As to the purchase price it states
"based on available information as well as what we know about the training industry and its relative profitability, SPX is prepared to offer a gross purchase price of £5.2m...the gross purchase price is based on a share price of £26 for each of the 36,152 shares of Mr Colin Campbell and £21.50 for each of the remaining 97,189 shares. SPX also expects to enter into a consulting agreement with Mr Campbell for up to 18 months, the terms to be negotiated".
A LAGTA board meeting took place on 5 July. It was attended by, amongst others, Mr Donnachie and Mr Cassells. According to the minute, the defender handed over to Mr Cassells for an update on the SPX proposal. Mr Cassells reported that a meeting with SPX had taken place on 28 June and a purchase price of approximately £21.50 per share had been negotiated, based on the April balance sheet. This price could change to a lower amount based on the May balance sheet figures. As to the purchase price, SPX was prepared to offer £5.2m gross, based on a share value of £26 per share for Mr Campbell's shares and, for each of the remaining shares, a price of £21.50. The board minute continues: "SPX were insistent that Mr Campbell stay for a handover period and a consultancy agreement for up to 18 months would be negotiated". The meeting was attended by Mr McLew, of Messrs Holmes MacKillop, the company's solicitors. He indicated that the next step should be for the managing director to issue a price to the shareholders. On this matter, the minute concludes: "After discussion, all present agreed to accept the proposal from SPX and that matters should be left in the hands of the managing director, the financial and legal people to deal with SPX...".
 Mr Cassells' file contains his note of the board meeting on 5 July (production 7/15.10). He records that he explained various matters relating to the share price of £21.50, including that the original offer equated to £19.34 per share based on April's numbers. He and Mr Campbell had then negotiated with SPX and "got a price of £21.50 per share". The numbers for May result in a figure of £20.78 per share. This was still better than the £20 per share which had previously seemed acceptable. The numbers would move until completion, as the price depended on the level of debt and the cash in the business. The note continues as follows
"GIC (Mr Cassells) then explained that there was another aspect to the deal and that it stated that CC would obtain £26 per share although this would also reduce by 72p per share to £25.28 per share in line with the movement in debt as explained above. GIC explained that one of the points in the letter was that there would be a consultancy agreement for CC and that we had not agreed the terms of the consultancy and therefore we are unsure as to what C C would get. However, GIC explained that CC was needed to make the deal happen and therefore as compensation for him having to work for another 18 months, there was a premium per share of £4.50. If the numbers worked out this broadly equated to about £160,000 which GIC said he believes equated to almost 2 years' salary for CC. CC then took over and explained to the board that he did not wish to work for that length of time (he is 67) but was prepared to do so in order to make the deal happen. However, he wished to be compensated for it. He explained that there was an amount which had been added to the price per share as this was potentially more tax efficient for him, however if the other shareholders did not accept it, the difference would not be added to their share price but would be added as remuneration and would come off the purchase price but he would not get it in as tax efficient a manner (CC is aware there is a risk he will not get this tax efficiently as GIC has warned him)".
 At a board meeting held on 1 August the minutes of the previous meetings of 13 June and 5 July were approved as accurate. As to SPX, there were no major matters to report. On 7 August the defender forwarded to Mr Cassells a draft of a letter which he had prepared and intended to send to shareholders concerning the offer. (This draft went through various revisals at the hands of different parties before it was signed and issued by the defender on 16 August.) So far as the purchase price is concerned, in the first draft the defender proposed saying: "The price of the shares has to be refined and is dependent on the exact financial position of the company at the time of purchase but the indicated price is £21.50 per share". No mention was made of the increased price for the defender's shares. No mention was made of the defender's consultancy arrangement with the new owners of the company. In general terms the draft letter was very positive in respect of the SPX offer.
 By letter of 9 August 2007 Mr McLew of Holmes MacKillop forwarded to the defender various documents, including the letter to shareholders as revised by him. Amongst other things, Mr McLew stated that it would be important to clarify "whether or not reference needs to be made to the fact that there may be a differential pricing structure within any share purchase agreement". Reference was made to the statutory requirement that all shares are treated equally.
"In this connection, you must therefore assume that if it is established that there is a differential then shareholders receiving a lesser sum than others may have cause to object to the procedures which were applied".
Mr McLew advised that the letter as drafted came close to a recommendation that the shareholders should accept the offer, and this at a time when no clearly defined position had been reached. He would have preferred to redraft the letter substantially, but was conscious that the defender was anxious to proceed speedily. Mr Cassells forwarded a draft of the letter to a director of SPX for any comments, who himself forwarded it to SPX's solicitors for their consideration. On 8 August Mr McLew had a telephone conversation with the defender in respect of the circular letter to shareholders and the relative powers of attorney. The defender was displeased that Mr McLew was not willing to have matters dealt with until his partner Stuart McNeill's return from holiday on the Monday. Mr McLew again raised the issue of the differential between the prices being paid for the defender's shares as against the others. He advised that "there was a risk factor here" which had to be recognised from the point of view of both the defender and the board.
 On 13 August the defender forwarded to Stuart McNeill a draft of the letter to shareholders. By this stage the letter had been revised by various other parties. It now stated:
"This agreement from VF/SPX is conditional upon me continuing for 18 months in a consultancy role. The share price is still to be finalised and is dependent on the exact position of the company at the time of completion but the indicative price is £21.50 per share with an enhancement share price of £26 for my share to reflect the 18 months consultancy period. Legal, financial and advisory expenses of approximately 5% will be deductible from the final agreed share value. In addition it is understood that VF/SPX will not ask all shareholders and directors, other than myself, to grant warranties or indemnities. You may feel the need to seek independent legal/tax advice regarding the contents of this letter".
Production 6/1 is a copy of the letter dated 16 August sent to shareholders by the defender. The advice as to the share price and the defender's consultancy role mirrored the quoted passage. The defender made it clear that he was sending the letter on behalf of the board of directors, and he enclosed a copy of a power of attorney to allow him to act as a shareholder's proxy. Thus, in this letter, the defender was advising the shareholders that the purpose of his enhanced share price was "to reflect the 18 months consultancy period". No explanation was given as to what this was intended to mean.
 The defender updated the board regarding the SPX offer at a meeting on 5 September, and again on 10 October. On 14 November Stuart McNeill and Graeme Cassells reported to the board on matters such as the share purchase agreement, bonds and floating charges, shareholders who could not be contacted, etc. At a board meeting on 28 November the board was told that matters were almost concluded. Various issues relating to the acquisition were discussed.
 The completion meeting was held on 30 November at LAGTA's premises. The share purchase agreement was executed on behalf of the purchasers and the selling shareholders, with the defender acting as proxy in many instances. In addition a compromise agreement between LAGTA and the defender was executed, being signed on behalf of the company by Richard Hawkins, one of the new directors, and witnessed by Claudia Berchtold, the new chairman. This document had been prepared by the purchasers' London solicitors. The purpose was to settle all outstanding claims which the defender had or may have against the company arising out of his employment and its termination on that date. The same parties also executed a consultancy agreement between LAGTA and the defender, in terms of which the defender would be paid £87,750 per annum in respect of consultancy services to be rendered to the company. The agreement was for a maximum period of 18 months. In the result it was terminated after one year.
 On 28 November 2007 the defender entered into an agreement with the five other shareholders who had granted warranties in favour of the purchasers, including the pursuers, regulating the manner in which any liability should be apportioned among themselves. In particular, the defender was to be solely liable for any successful claim up to a maximum of £250,000. Thereafter liability would be shared equally.
 Pausing here, the points emerging from the contemporary documentation include the following:
(i) The initial offer was for £20 per share. The board asked the defender to attempt to negotiate an increased offer.
(ii) The defender entered the meeting with SPX on 28 June with the intention that only he would gain the benefit of any increased offer. He wanted £1 million for his shareholding. Before numbers were discussed, the defender raised the issue of a possible role for himself after the acquisition, and was told that the purchasers wanted him to stay on for probably 18 months. In the first part of the meeting the purchasers increased their offer to £5.125 million.
(iii) This increased offer did not give the defender as much money as he wanted, especially after he was persuaded by Mr Cassells to limit the amount of his premium by allowing the other shareholders £21.50 per share. When the meeting reconvened, the defender asked for and obtained an additional £75,000 from SPX, who also agreed to the defender's suggestion that the offer should be couched on the basis that the overall purchase price should be apportioned £26 per share in respect of his holding, and £21.50 per share for everyone else. (All of this was subject to the balance sheet figures at completion.) The £21.50 figure was less than an equal distribution of the £5.125 million offer.
(iv) On reading Mr Cassells' note of the board meeting on 5 July, one can readily understand how and why an impression might have been created to the general effect that the defender's premium was explained and justified on the basis that it was remuneration for the proposed consultancy arrangement. In the context of the current dispute, the question arises as to whether this was the real reason for the defender proposing it and for SPX agreeing to draft their offer in the terms suggested by the defender. (In due course the defender obtained a full salary for the consultancy, with no reference to, nor deduction in respect of the share premium paid to him.) There is also a question as to whether the defender was correct in stating that the most which the other shareholders would ever receive was £21.50 per share. In other words, that the defender's premium was not prejudicial to them.
(v) In his draft of the circular letter to shareholders, the defender chose not to mention either his premium or the consultancy arrangement. He received legal advice that the premium had to be disclosed. The letter sent to shareholders justified the defender's uplift by reference to the consultancy.
The evidence at the
The evidence of Gerard Donnachie
 Mr Donnachie is the finance director of the pursuers. He spoke to his witness statement and two supplementary statements. He was never a director of LAGTA. The pursuers' chairman, Douglas Park, was a director, but on occasions Mr Donnachie attended on his behalf. When Mr Park was available, both he and Mr Donnachie attended. Mr Donnachie explained that the defender was the only executive director. He ran the company on a day to day basis. The defender was very enthusiastic about selling the company. He was nearing retirement. He and the pursuers held almost 60% of the shares, with the remainder spread among 29 other parties, with percentage holdings ranging from 7.4% to 0.15%.
 In view of the defender's impending retirement, and also the difficult trading conditions, the board was interested in selling the company. The defender was authorised to negotiate with SPX. He was given the authority to represent the interests of the company and its shareholders. Mr Donnachie could remember the board meeting on 5 July 2007, at which the defender explained the nature of the deal proposed with SPX. The letter from SPX, which is mentioned in the board minute, was not circulated at the meeting. According to Mr Donnachie, the vast majority of information came to the directors through the defender. He said that he was to receive a premium for his shares, the reason being to remunerate him for his continued service to the company after the sale in terms of a consultancy agreement, which SPX insisted had to be put in place. The payment for his continuing services was being made in this way because it was more tax efficient for him. No other explanation was offered then - or at any other time - until the present court action was instigated. There was no mention of the premium being a reward for lengthy service with LAGTA, nor a reward for a successful negotiation. There was no suggestion at the board meeting that if the differential in share price was not agreed it would be added to the consultancy agreement, with no additional funds being made available to the other shareholders. The directors required little persuasion to approve the premium on the basis upon which it was presented, namely tax advantages to the defender. The board was not advised that there would be additional remuneration in terms of the consultancy agreement.
"What is crystal clear to me is that the remuneration for the consultancy was effected by the premium in share price, and that there would be no further remuneration. Otherwise, there could have been no justification for the premium".
A deal was eventually done with the defender in respect of the warranties question, but at no time did any question arise about connecting the warranty liability to consultancy remuneration. There was no link between the two issues.
 Had Mr Campbell asserted to the board that he deserved a bonus, Mr Donnachie would have taken it back to his principal for instructions. According to Mr Donnachie, the defender was "most anxious" to conclude a deal and obtain a capital sum to enhance his pension situation. There was no discussion at any prior board about the defender receiving an enhanced share price. No one wanted the deal to go through more than the defender. The warranty agreement was entered into, not because of the additional share premium price obtained by the defender, but because he, as the only executive director, was the only one with the necessary knowledge and experience to accept responsibility for them. Only he ran the business from day to day and knew the details of its operation. The subsequent negotiations with the purchasers over a consultancy were unknown to the directors, and of no consequence to them.
 Mr Donnachie attended the completion meeting. It was shambolic. Everyone was kept waiting. The scene was chaotic. The various agreements were being prepared right up to the last minute. There were problems in having revised documents printed. The contents of the documents were not discussed; they were simply laid out on a table for signing by the relevant parties. Mr Donnachie expected the defender to inform the meeting of anything of relevance about the agreement. The directors' concern was the price being paid and the position relating to warranties, which had been resolved.
"I can confirm unequivocally that Park's would never have agreed to sign the share purchase agreement involving a share premium being paid to the defender if they had known about the remuneration contained in the consultancy agreement. There would have been no justification for a premium if he had been receiving consultancy fees".
 Mr Donnachie stated that the letter of 16 August set out the position at it was portrayed at the board meeting on 5 July, and this was, and at all material times continued to be taken at face value as confirmation of what the directors had been told at the meeting. "So far as I am aware, we all proceeded on that basis right up until (and indeed for some time after) the SPA (share price transaction) was entered into". Mr Donnachie indicated that the custom was that the board minutes were "pretty skeletal in form". The minute of the 5 July meeting fell into that category, although there is nothing which he would regard as incorrect. Item (1) is a "bare representation" of a lengthy discussion. The defender did most of the talking at the meeting.
 In cross examination Mr Donnachie accepted that Mr Cassells was advising on this transaction. He would have expected him to have been more proactive when things were being explained at the meetings. Mr Donnachie was as sure as he could be that the SPX letter of 5 July was not circulated to the directors. The share price differential was explained by reference to tax efficiency regarding the consultancy arrangement.
 Mr Donnachie explained that if the LAGTA business had carried on as it was for another couple of years, it would have gone out of business, therefore it was a case of obtaining the best price possible. Under reference to Mr Cassells' note of the 5 July board meeting, Mr Donnachie insisted that the directors were not told that the defender would be receiving additional monies in respect of the consultancy. "I know what was said on the day". Mr Campbell clearly stated that he was receiving the benefit of taper relief on capital gains tax. The directors were never given any details of the terms of the actual consultancy agreement. Mr Donnachie was not interested in it - he assumed that the defender would be receiving no additional remuneration. Copies of drafts of the consultancy agreement were never circulated, nor was the agreement itself.
 Mr Donnachie was not disputing that SPX might have been under the impression that they were expected to pay Mr Campbell an income in respect of the consultancy. If the defender was negotiating an additional income in relation to the consultancy agreement, that should have been made clear to the directors. It should have been reported to the board. As it was, at the July meeting the defender said that he was obtaining a premium on his share price because of the aforesaid tax advantages. Mr Donnachie agreed that at the end of the 30 November meeting the defender said that the consultancy agreement was not yet completed. That could have related to other matters such as hours of work, etc. Mr Campbell had a fiduciary duty to lay the full details before the board. There was, at most, passing mention of the compromise agreement and the consultancy agreement.
 Mr Donnachie was referred to Mr Cassells' note of the 28 June meeting. Mr Donnachie explained that, not having been at the meeting, he could not contradict the note. Mr Donnachie could only speak to what was said at the board meeting. The board did not authorise a bonus to Mr Campbell of some £160,000.
With regard to the circular letter to shareholders of 16 August, and in particular the passage stating that Mr Campbell's share price of £26 was "to reflect the 18 months consultancy period", as far as Mr Donnachie was concerned, this was on a par with his evidence. Mr Campbell could hardly have put in the letter that he was trying to avoid income tax. It was put to Mr Donnachie that the letter was ambiguous. Mr Donnachie replied, "not in my book". Under reference to the board minute of 14 November, and in particular the passage relating to warranties, Mr Donnachie had a telephone call with the defender regarding this issue. The pursuers considered it unfair that non-executive directors should be asked to give warranties at the same level as the sole executive officer of the company. He denied that he made any mention that Mr Campbell was obtaining more money for his shares than everyone else. Mr Campbell was very keen for the transaction to go ahead. As the only executive officer he was responsible for anything "which came out of the woodwork" in relation to warranty claims. His share premium had nothing to do with the warranty agreement between the directors.
 When cross-examined as to whether he was accusing Mr Campbell of fraud, Mr Donnachie replied that he certainly thought that "we were deceived". Mr Donnachie stressed that Mr Campbell wanted "to cash in". Mr Donnachie did not agree with the proposition that it was the fact that Mr Campbell did not want to stay which explained the share premium.
The evidence of John
 The pursuers led evidence from John Maitland, a former director of LAGTA. He spoke to his witness statement. For a few years the defender had been keen to find a buyer for the company. He wanted to retire. The defender looked to a company called Carter & Carter as potential purchasers. He also mentioned SPX, hoping that SPX and Carter & Carter could be played off against each other in order to obtain the best price. However, in the result the only possible deal was with SPX. These informal discussions between Mr Maitland and Mr Campbell took place over a period of 3 - 4 years prior to the eventual deal.
 Mr Maitland attended a number of board meetings throughout the process of the sale to SPX. The defender, in his capacity as executive managing director, handled the deal on behalf of the company, together with the company's solicitors, Holmes MacKillop, and accountants PKF. Mr Campbell was authorised to handle the negotiations given that he was the only executive director, and the only person familiar with the detailed workings of the company on a day to day basis. Mr Maitland was satisfied that the defender would do his best to maximise the return for the shareholders because he was one of them. It was Mr Campbell who was expected to report to the board on all the relevant details.
 At a board meeting on 5 July the defender said that an overall price had been negotiated, which provided all the shareholders with a sum of £21.50 per share. He then indicated that it was an essential condition of the deal that he stay on as a consultant for a period of up to 18 months. He said that, as a consideration for him staying on, the purchasers would pay a little extra.
"The way he put it was that they were prepared to pay a price for the company (which could be divided anyway we saw fit) and, in addition, a sum of money would be paid to him for the time he had to stay on. His preference was that this sum be added to the price of the company, because it was beneficial to him tax wise to pay capital gains tax with taper relief, rather than income tax at the top rate".
The result was that Mr Campbell would receive more for his shares than everyone else.
"I was in no doubt whatsoever that what we were being told was that he would be receiving no additional remuneration to reflect his time as a consultant. That was undoubtedly my understanding of the position. I was quite prepared to go along with that, on the basis that the price of my shares was unaffected".
 Mr Maitland was a senior partner of the haulage firm John Maitland & Sons of Mauchline. He had and has no interest in the pursuers. He recalled that there was an issue about the warranty indemnities. Mr Donnachie indicated that his company was unhappy about being involved in liability for warranties when they had no direct knowledge of the daily operation of the business. Since the defender was the only person with detailed knowledge, he should carry the bulk of the liability in this regard. Mr Maitland agreed with that position, as did the rest of the board. In due course a compromise arrangement was reached whereby Mr Campbell carried a larger liability than the other directors. Mr Maitland attended the completion meeting and signed all necessary documents. He had signed a power of attorney, but apparently it had been lost thus he required to execute the documents. He did not look at any of them - he simply signed where asked. (Mr Maitland did not require to sign the compromise and consultancy agreements.)
 Subsequently Mr Maitland was informed that the consultancy agreement provided for Mr Campbell to be paid a significant salary. He was not happy about that.
"I feel I was 'conned'. I would not have agreed to the share enhancement if Mr Campbell was going to be paid for his consultancy period. He gave no other explanation at that time for the share enhancement. He signed a letter to shareholders dated 16 August 2007 in which he explains the basis for the share enhancement - which reflects what he told the board at its meeting. I am also in no doubt that the company's sale would have proceeded on the basis of the lump sum being offered by the purchasers. How that sum was distributed was of no interest to them, so long as they received the shares. I believe that Mr Campbell is now claiming that he would have refused to sell his shares if he had not been receiving pay for his consultancy agreement, in addition to his enhanced share price. I do not believe that for one moment. In my opinion, he would have sold without question - he was desperate to sell and cash in his shares to boost his pension".
 Mr Maitland was cross examined by Mr Logan on behalf of the defender. The variation in the share price was explained to the board by Mr Campbell. He would remain for a period of time to give management continuity - that was part of the package. Mr Campbell told the board that he had discussed this matter with the accountants and it was more beneficial for him if the sum was to be added to the share value. It was a tax matter. That was how the differential came about. As to the board minute referring to a consultancy agreement for up to 18 months being negotiated, Mr Maitland commented that the financial situation had been explained to the board - however there could be other terms to be resolved regarding work, etc. No one had a problem with the share premium since it did not affect the other shareholders. When asked if the terms relating to the premium were set out by Mr Cassells or Mr Campbell, Mr Maitland replied that they were set out by both, along with the reasons for it. Mr Campbell did say that SPX were insistent that he stay for up to 18 months. Having been referred to Mr Cassells' note of the 5 July meeting, Mr Maitland did not recall the consultancy agreement being put forward on the basis that there was uncertainty as to what Mr Campbell would get from it. He was pretty sure that it was not put that way. His recollection at the time was supported by the later letter, namely that the enhanced payment Mr Campbell would receive was in respect of the post-acquisition 18 month period. He was being paid that way for tax reasons. Mr Campbell said that he wanted to retire. Terms other than the financial, for example relating to hours of work, scope of duties, length of the agreement, they were matters between Mr Campbell and SPX. Mr Maitland accepted that the board was told that the consultancy agreement was to be negotiated. His understanding was that, as at 5 July, the consultancy agreement had not been finalised.
 It was put to Mr Maitland that the whole board was reliant upon the advice from the solicitors. Mr Maitland would have expected help from the solicitors; however it was Mr Campbell who updated board meetings in relation to the SPX situation. If technical issues arose he would hand over to the appropriate expert. Mr Maitland was not aware that the defender had entered into a compromise agreement giving up rights under his employment contract with LAGTA. He has no recollection of mention of a compromise agreement. He did not appreciate that Mr Campbell had ceased being an employee as at the date of the sale. Mr Maitland had decided not to make any claim against Mr Campbell in respect of his own interest. Anything he would gain would be outweighed by the costs of litigation. Mr Maitland had 1300 shares in LAGTA.
 Mr Maitland was cross examined as to paragraph 20 of his witness statement, in which he states that he received a call from Mr Campbell after the Park's of Hamilton claim had been intimated. Mr Campbell had tried to persuade him that the remuneration he was receiving from SPX was for different work, not related to LAGTA, but work related to their possible acquisition of other companies. It was put to Mr Maitland that this was untrue, but Mr Maitland adhered to the terms of his statement, which he had signed. Because he knew of the legal case, Mr Maitland did not want to embark upon a conversation with Mr Campbell, who "tried to put words into my mouth".
The evidence of the
 Mr Campbell spoke to his witness statement. He sets out his career background. Armed with a degree in economics he was employed by the Road Transport Industry Training Board in the late 1960's. He became a qualified training officer. There was a strategy to set up group training associations for small to medium sized businesses. The defender was involved in creating such an organisation for Lanarkshire. By 1969 the Lanarkshire Automobile Group Training Association (LAGTA) was formed. About 30 garages participated when the first training centre opened in 1970. Eventually it had the capacity to train up to 80 apprentices at a time. The defender left the Road Transport Industry in 1969 and set up a trading facility for Taggart's of Motherwell. Subsequently he returned to LAGTA in the position of group training manager. By 1974 LAGTA was involved in the training of HGV and forklift drivers, and of apprentice mechanics. LAGTA Ltd was incorporated in 1978. The defender became managing director and was given 2000 shares. The company was involved in many government training schemes over the years, being given grants and other incentives to take on unemployed young people and adults. In the early 1990's the government decided that trading boards should go. As a result LAGTA lost its main source of income. The company targeted the car manufacturing industry to attract new business. LAGTA managed to hold its own while other similar companies fell by the wayside. Gradually LAGTA took over other associations and expanded its activities, including into Midlothian and Ayrshire.
 As a result of various acquisitions the company gathered a diverse group of shareholders. Though originally set up to provide training for members, the company was now, essentially, a training business looking for clients. The shareholders were a legacy of the earlier days. The company bought training facilities in Ayrshire and Coatbridge. In the early 2000's there were discussions about a possible takeover of LAGTA by a substantial training concern called Carter & Carter. However they were looking for another outlet in Scotland, and became a possible threat to LAGTA's business. In the early 2000's LAGTA was struggling. The company was only able to sustain itself by selling assets. The defender put to the board that the company required a top class facility in the right location, which would make it more attractive to potential "suitors". A site was identified within the Eurocentral development. The new facility opened in 2005 at a cost of £2.5m. Carter & Carter agreed to have a look at it. At around the same time the defender was informed that Valley Forge had an interest in purchasing LAGTA. A director of Carter & Carter visited LAGTA and spoke to the defender and Graeme Cassells regarding a possible takeover. The concept of the defender having a higher value placed on his shareholdings was raised by the Carter & Carter director. He said that this would be in recognition of the part the defender was playing in making the deal take place. "I am certain that this is where the idea of an enhanced value for my shares came from".
 On 13 June 2007, the board was informed that the main organisations showing an interest in purchasing the company had been Carter & Carter and SPX, however, Carter & Carter had just stated that they would no longer pursue their interest, although they might revisit the situation at a later date. A letter had been received from SPX indicating an interest to purchase the shares of the company net of debt for £4.75m. "Certainly the last thing I wanted was to let this offer go, but my instructions from the board were to seek an increase in the price".
 In his witness statement, the defender discusses the 28 June meeting involving Mr Spence, Ms Berchtold, Mr Cassells and himself as follows.
"We had a meeting at which various figures were discussed. I made it clear that my instructions from the board were to get an increased price and we eventually got their offer up to £5.2m. At that meeting there was discussion about the enhancement on my share price as had been offered by Carter & Carter. The concept was accepted by the Valley Forge directors but the level of the enhancement was not set out specifically at that time. On this occasion, however, it was clear that SPX/Valley Forge wanted to have me as a consultant for a period of up to 18 months. This was not something I was overly keen on, as after the death of one of my sons and my wife within a fairly short period of time I felt I needed to move on, but at the same time I certainly was not going to peril the whole deal on a refusal to be a consultant. As I recollect, at that meeting Graeme Cassells did some basic calculations about share price and, as a result of those negotiations, the figure of £26 for my shares and £21.50 for everyone else's shares was settled upon. At the time, it is my recollection that I saw the uplift in my share price to be a reward for my efforts, particularly bearing in mind that I managed to negotiate the price from £4.75m to £5.2m. It was also in recognition of the fact that I would have to commit myself to the whole arrangement for a period of up to 18 months when my preference would have been to retire. All of this was reported to our board meeting on 5 July".
 Mr Campbell said that the discussions at the meeting on 28 June offered a chance for him to put forward the idea floated at the meeting with the director of Carter & Carter concerning him being paid extra for his shares because of the important part which he had played and would have to play in the business. "I thought it logical that I could carry this through to the second bidder". The offer was increased to £5.125m. The defender thought there was more to come. The defender was carrying forward the Carter concept. He had a certain figure in mind, namely it would be nice to have £1m. By obtaining an extra £75,000 this took the offer to £5.2m. Mr Spence said, we will give you an enhanced price of £26 per share. This meant "I didn't get the £1m". The defender explained that it was clear to him that Mr Spence and Ms Berchtold wanted him to remain after the takeover as a consultant. The defender was reluctant, being almost 68 years of age. However if this was going to "scupper the deal", he was prepared to stay on.
 A final offer was received dated 5 July 2007. In his witness statement the defender discusses Mr Cassells' note of the 28 June meeting.
"I had gone into the meeting with the target of getting £1m for my own shares but it became apparent as the negotiations proceeded that I was going to be well short of that figure. There was discussion about a differential in the amount I would receive for my shares and that of the other shareholders. I felt strongly that I was entitled to that, standing my efforts over the years, that I was going to have to put an enormous amount of personal time and effort into the whole transaction, and that it looked as though I would have to delay my retirement in order to persuade SPX to go ahead. We talked about various ways in which I would be compensated for this. Graeme has noted that I was looking for another £75,000 and, eventually, in our calculations the way this worked out was for me to get £26 per share and for the others to get £21.50 per share".
 The SPX offer was dated 5 July 2007, the day of the next board meeting. The defender states that he cannot say for certain whether or not copies were distributed, "but any director that wanted to see the letter would have been able to read it". The defender notes that the letter states that SPX expects to enter into a consulting agreement with Mr Campbell for up to 18 months "the terms to be negotiated".
"It was clear from that that the terms of my consultancy arrangement were separate from the share price. ...it is clear from the letter and from the minute of that meeting that my consultancy arrangement had nothing to do with the purchase price of the shares".
The price of the shares had been increased by a significant percentage and everybody at the meeting "was delighted". The defender does not recollect any lengthy or difficult discussion about the increase in the value of his shares.
"I cannot say what was in the mind of others, but my general impression and feeling about the increase in my share price was that it was a reward for effort. All the shareholders found themselves in a very beneficial position because of all that I had put into the company over the years and certainly I felt that the differential was to take account of that. The termination of my employment was never really discussed. Neither was there any discussion about how the sale of the company was going to affect me. The board minutes, as subsequently approved, made it clear that I was to get an increased price for my shares and that my consultancy agreement was still to be negotiated. No one raised any objection to this at all. It should have been clear to all those present, including Mr Donnachie who represented Park's of Hamilton, that the consultancy arrangement had not been settled and that, certainly, it was not the case that my consultancy was in exchange for the increase in the share value. Bear in mind that I had worked for LAGTA for 35 years. I was the person who had kept it afloat and driven it forward. Although that might not be minuted, I am quite certain that those in attendance at the director's meeting fully understood that'".
 In his witness statement, the defender makes reference to Mr Cassells' note of the board meeting of 5 July. He states:
"Graeme's note presents the uplift as compensation for me having to work an extra 2 years although in my own mind it was more than that. The fact that I had such long service with the business of LAGTA Ltd, and that I was the one that had pulled off the deal, I felt meant that I merited a bit more than everybody else as well as the fact that I was going to have to commit to LAGTA Ltd for another 18 months which I did not want to do. It is clear from Graeme 's note, however, that he explained that the terms of the consultancy agreement had still not yet been arranged".
 The defender explained that the bank loan of £2.5m required to be repaid. There were other company debts, all of which would come off the purchase price. The defender did not know the ultimate sum he might receive. He expressed the view that the consultancy agreement was "an entirely separate issue". At the board meeting of 5 July Mr Cassells set out the terms of the offer. The offer from SPX came on a PDF on an e mail. The defender was "pretty sure" that the directors would not receive a copy of it. There was "an issue of confidentiality". The defender was sensitive to the fact that the directors had their own companies to run. No one asked for a copy. It is likely that the letter was on the board room table. In his evidence the defender explained that he would have to work on, and he was receiving compensation for the extra 18 months, resulting in a £4.50 share premium. This was "nothing to do with consultancy - it was needed to make the deal work - I needed to sign on for a further period". The defender had no idea where the idea came from that the £4.50 per share was to be his payment for the consultancy. Everyone was clear that there was to be an uplift in his share price, and that the terms of the consultancy were still to be negotiated.
 Under reference to the terms of Mr Cassells' note of the board meeting, the defender did not recall him stating that the share premium "broadly equated to about £160,000, which ...equated to almost 2 years' salary for (the defender)". The defender thought this came from Mr Donnachie. "I didn't think it meant very much". This was not a discussion - it was a remark. Mr Cassells said - "yes, that's about right" - then we moved on. "I was prepared to work for up to 18 months - I wished to be compensated for it". When asked in evidence in chief how he was being compensated for it, the defender replied by the uplift in the share value. When asked about the reference to tax efficiency, the defender had difficulty in recalling. All of this was five years ago. Mr Cassells probably said that if the directors do not agree to this, things will go into the melting pot. Mr Spence had said that this was to go to Mr Campbell, to be a payment to him for making the development happen and for staying on afterwards. When asked as to why this was to be more tax efficient, the defender made reference to 10% capital gains tax as opposed to 40% income tax.
 The defender stated that Mr Cassells played the major role, given that much of the discussion involved finance. When referred to Mr Donnachie's witness statement, the defender insisted that the uplift in his share price was for making the deal happen and for agreeing to stay on. It was not payment for the consultancy itself. Mr Cassells' note of the 5 July meeting accorded with the defender's recollection. The defender accepted that he did tell the board that the money would come to him "whatever", but that was more "like an an aside - not a focal point". He would receive the £4.50 per share in some other form, it would not be added to the others' share price. The defender stressed that throughout there was no attempt by him to conceal the terms of the consultancy agreement. It was to be a separate matter.
 In his witness statement the defender explains the agreement regarding the warranties by reference to a telephone conversation which he had with Mr Donnachie. Mr Donnachie mentioned that the defender was receiving an enhanced share price and, as he was the managing director, the defender should take the "heavy end of the warranties". The defender said that he was forced to take the risk since he was "getting a substantial proportion of the price of the company". Turning to the letter of 16 August 2007 to shareholders, the defender confirmed that he drafted the initial letter and sent it to Mr McLew of Holmes MacKillop. In the first draft the defender made no mention of the price for his shares. The draft then went through various versions and revisals at the hands of a number of persons. Mr McLew had concerns as to the enhanced share price which "might muddy the waters".
"I cannot recollect in the course of that conversation (with Mr McLew) saying anything about the increased share price reflecting my consultancy arrangement. I doubt very much if that is what I would have said as that was not what I had in my mind and it was not part of my thinking. It was, however, reflective of the fact that I was having to work up to an extra 18 months that I didn't want to work and, to that extent, it was compensation for my inconvenience. In my mind, however, I really saw it as a reward for my efforts for the company over the years and, in particular, in securing the sale of the shares".
The defender was not the author of the revisal to the letter introducing the phrase "to reflect 18 months consultancy service". All of the shareholders received the letter. The letter was signed by the defender. The defender did not intend to convey the impression that the share price premium reflected payment for the consultancy. The negotiations with SPX were not conducted on that basis. Ms Berchtold, when finalising the terms of the consultancy agreement, did not assert that the defender had been paid for it by virtue of his enhanced share price. No one ever suggested this to the defender.
 In his witness statement, under reference to one of the drafts of the letter to shareholders (production 7/15/14), the defender states:
"This is a draft of a letter which Graeme Cassells sent to Mr Sharma of SPX. It is in this letter that reference to the share price first appears and a statement is made about my enhanced share and the reason given is to reflect the 18 months consultancy period. This letter, as can be seen from the production, was Graeme Cassells' draft rather than my own. Accordingly I was relying on him for advice and how this should be put to the other shareholders. Gerard Donnachie of Park's of Hamilton, however, had the benefit of being present at all of the directors' meetings and would have been well aware of the context in which that part of the letter was written. Mr Donnachie would, certainly, have understood that the issue of my consultancy agreement still had to be negotiated and that its terms and conditions were unknown. He must also have understood that I had hoped to retire at 67 and I was looking for some compensatory payment by virtue of the fact that I was having to commit to SPX/Valley Forge for 18 months when I did not want to and that, at that point, my consultancy agreement had not yet been negotiated".
 The defender states that in the period up to the completion of the sale, his energies and concentration were taken up with "running around trying to get the powers of attorney signed". The issues of the compromise agreement and the consultancy agreement did not really arise until just a few days before the sale. At that stage he had never heard of a compromise agreement and "frankly, I did not fully understand what it was". The defender accepts that the documents indicate that on 26 and 27 November he had discussions with Holmes MacKillop concerning the consultancy and compromise agreements, but he does not recollect the detail of them.
"At that stage, it was clear that SPX were, in effect, going to pay me my usual salary and benefits. Although I was entitled to 13 or 14 months' notice in terms of my contract of employment, if I was going to get that kind of pay from SPX then I was quite happy to waive any claim that I had against LAGTA".
The defender was surprised
"and, to some extent, delighted that Valley Forge/SPX were prepared to match my terms and conditions. Had that not been the case then I am quite sure that my position on the compromise agreement with LAGTA would have been quite different. I was happy to follow the advice given to me by Holmes MacKillop on this and was content with the arrangement that, although I was giving up my claims for payment in lieu of notice etc with LAGTA, I was, at least, going to be paid my going rate for the forthcoming year as a consultant with Valley Forge".
 Turning to the settlement meeting on 30 November, the defender described it as "a shambles". The consultancy agreement and the compromise agreement were not finalised until the morning.
"I am not sure, with hindsight, that I understood all the implications of those agreements, but I certainly understood that I was giving up a claim against LAGTA Ltd but I was being compensated for that loss by virtue of the consultancy agreement. Clearly, such an arrangement was beneficial to all of the LAGTA shareholders, including Park's of Hamilton. ...my recollections are that at no time during the whole process were the implications of the compromise agreement made clear to me. No attempt was made to spell out the financial loss I would suffer by giving up all my employment rights. My own interpretation of events is that by giving up my employment rights which were substantially more than my share price uplift, all shareholders would benefit as my employment termination would have been a deduction before paying out the net share value. In addition, I believe that whatever the terms of the consultancy agreement were to be, they would at least balance out the discrepancy between my employment entitlement and my share uplift. As it transpired my consultancy agreement was terminated after 12 months - which was a month or two less that I should have received if my employment had been terminated as per my contract. Therefore I received less money than I would have if normal employment termination had taken place. Throughout the whole process from SPX's offer to purchase the company, up to the final day, I relied heavily on the professionals we had brought on board. ...there was a division of functions into financial, handled by Graeme Cassells and Alistair Adams, legal handled by Kenneth McLew, Stuart McNeill and Nicholas Howie of Holmes MacKillop, and shareholder contact which was left to me".
The defender is critical of his legal representatives. He trusted them and relied on them to look after matters in such a way that they would not disadvantage the shareholders or employees, which obviously included himself. "The fact this action is taking place is surely evidence that the latter did not happen". The defender is also critical of the other members of the board.
"Since the board were collectively responsible for the company's affairs, I feel there should have been more emphasis placed on supporting me and the other shareholders than they provided".
He has no recollection of the directors ever offering him the benefit of their wisdom or warning him about potential legal pitfalls. Douglas Park did not attend a board meeting for over a year, preferring to send his company's secretary, Mr Donnachie.
 At the completion meeting the documentation was brought in by Mr Howie and placed on the table in front of the shareholders. Mr Donnelly and Mr Parks were there. The defender had to sign in respect of his powers of attorney. Shareholders present had to sign the share purchase agreement. "Not one word was said and nothing was asked".
The cross examination
of the defender
 The defender was cross examined by Mr Sandison on behalf of the pursuers. There were concerns regarding the company's viability. It had a brand new state of the art training centre at Eurocentral, however it continued to make losses on the trading side. In 2007 it was an open question as to whether the defender would retire. With regard to the suggestion by Mr Marples, a director of Carter & Carter, that, if they bought LAGTA, the defender should receive a premium in respect of his shares, the defender was asked whether this struck him as an odd thing to suggest. The defender replied that it was more "a pleasant surprise". There was nothing to suggest that it was an abnormal proposal. Mr Marples said that Carter & Carter would pay the defender more for his shares because of his involvement in the deal. At the time the defender did not appreciate that the shareholders enjoyed equal rights. The defender did not regard his shares as any different from the others. Under reference to the board minutes of 13 June 2007, the defender accepted that the price differential proposed in the discussions with Carter & Carter was not presented to the board. The Carter & Carter proposal fell by the wayside. It was replaced by the SPX proposal. The defender was the only director of LAGTA involved in the negotiations with SPX. Ultimately the defender received a sum of just under £940,000. The value of the premium was £162,684.
 The defender explained that liquidation was an unattractive option. The company would have closed and employees would have been out of work. A sale and lease back was not a viable option. In reality it was SPX or liquidation. The defender accepted the proposition that the role of Mr Cassells was to advise him regarding the financial aspects of the negotiations. It was the defender who made the decisions. He received professional support from both Mr Cassells and Messrs Holmes MacKillop. The defender was keen on the SPX offer. It was the "only game in town". He thought it unlikely that Mr Cassells would contact other members of the board regarding the negotiations.
 Turning to the 28 June meeting with representatives of SPX, the defender agreed that he raised the issue of his enhanced share price. It was not the purchasers' idea. He did not recollect telling any director or shareholder that he would do this. It was "a concept in his mind". He did not consider raising it with the board because SPX "might have kicked this into touch right away". The defender denied that he asked for a sweetener from SPX to make the deal happen. He did not think about the attitude of other shareholders to his share premium proposal. He felt a deal had to be done with SPX. If they accepted it, he would bring it to the board.
 Mr Cassells' note of the meeting of 28 June was put to the defender. It states that the question of a premium for Mr Campbell had been discussed prior to the meeting between Mr Cassells and the defender. The defender denied that he linked the additional premium to work in the future for SPX. The negotiation and SPX wanting to keep him as a consultant were two separate items. He was asked whether Mr Cassells was wrong in saying that Mr Campbell would receive an additional amount "as compensation for the fact that he would need to take this forward and for work in the future for SPX". Mr Campbell replied that the wording does not convey the separation he had in his mind. The figures of £21.50 and £26 came from Mr Cassells. The defender accepted them. The defender agreed that he asked for an extra £75,000. It was put to him that all of that went into the premium; however the defender replied that it was added to the total share price. It would not all have gone to him. Previously SPX offered £5.125m with no differential. All the defender saw was an extra £75,000 going into the pot. It was put to the defender that all of the £75,000 and an extra portion of the £5.125m was going towards the share premium. The defender volunteered that the original bid was for the stock of the company - "they didn't care how it was split". Again it was put to the defender that all of the £75,000 went to him. The defender stated that he did not conceive it in that way. He accepted that £5.125m was on the table with no differential for anyone. It was put to the defender that in fact he received a premium of in excess of £162,000. The defender was asked whether he disagreed with the content of Mr Cassells' report of the meeting of 28 June. The defender did not disagree with the content - however the layout could have been better. Instead of £75,000, the phraseology should have been £5.2m. The defender probably said something along the lines of, if £75,000 was put in, it would bring it up to £5.2m, and I would have done well by the company.
 Mr Spence said that they wanted to retain Mr Campbell as a consultant. The defender told Mr Spence that he was reluctant to stay on as a consultant. A period of one year with a possible extension of 6 months was a good compromise. The defender had no intention of staying for the additional 6 months. Mr Spence did not say that otherwise the deal would be off, but that it would help everyone all round if Mr Campbell stayed on. There was no talk of adjusting the figures if he stayed only for a year.
 So far as the meeting on 5 July is concerned, the defender accepted that the board was not told that the share price differential was his idea. The directors were not informed of the sequence of events as set out in Mr Cassells' note, namely £5.125m with no differential, then £5.2m with the differential. "I just cut to the chase". The defender stressed that the bid was increased from £4.75m to £5.2m. The board were people giving up time - he gave them a "distillation". The defender could not recall if he had told the board that one of the reasons for the premium was that the defender was of the opinion that he deserved a reward for a good negotiation. Mr Spence did not "insist" on the defender remaining as a consultant. That word "is a bit strong" - it should be "would be happy". The defender accepted that the letter of 5 July from SPX containing the offer does not make it clear who suggested the differential. The defender volunteered that "it was no concern to SPX what LAGTA did with the money they were prepared to pay for the shares". The letter does not make it clear that an alternative offer of £5.125m was on the table. It does not say that there would be separate remuneration for the defender regarding the consultancy agreement. The letter gives no reason for the additional share price offered to the defender.
 Turning to Mr Cassells' note of the 5 July board meeting, the defender accepted that it does not record the board being told whose idea it was to have the differential, nor that £5.125m with no differential was on the table. Nothing is said as to how the issue of the premium developed. It was put to the defender that a share price of £5.125m with no differential would have resulted in all the shareholders, except him, receiving more money. The defender thought that was "a rather contrived" way of putting what was happening at the meeting. It had not occurred to him that £5.125m split equally would result in everyone receiving £22.16 per share. An equal split of £5.2m would result in £22.73 per share. "I say these calculations didn't enter my head".
 The defender was asked as to whether the separate financial aspect to the consultancy arrangement was mentioned to the board. He replied that they were told that the terms were still to be negotiated. It was implied that this would cover financial terms. Under reference to Mr Cassells' note, it was put to the defender that the phrase "compensation for having to work" would suggest remuneration or pay, particularly in the context of a comparison being made with the defender's equivalent in salary with LAGTA. The defender stated that compensation could be for injury/inconvenience. He thought it was Mr Donnachie who raised the comparison. Mr Cassells scribbled something down, and said, "yes I suppose it does equate to almost two years salary for Mr Campbell". It was a one off remark. Mr Campbell did not interpret the additional sum in this way. Mr Cassells had warned the defender that the tax authorities may view the share premium as remuneration for work. Under reference to the passage in the note which suggests that Mr Campbell explained that the amount had been added to the price per share "as this was potentially more tax efficient for him", the defender accepted that he said this. When asked if it was untrue, the defender replied that it was not untrue. Mr Sandison put to the defender that he had said in evidence that the premium made no difference to SPX. The defender stated that SPX were prepared to pay in total £5.2m for the company. SPX had agreed to compensate him in a tax efficient amount, but if this was not agreed, the money would be paid to Mr Campbell as a lump sum anyway.
 Mr Sandison suggested that Mr Campbell had lied to the board and he was lying now. In his evidence he had twice said that it made no difference to SPX how the money was distributed to shareholders. The defender considered that this was "splitting hairs". It was SPX's intention to see that he received that amount of money in one form or another - that was his recollection. The defender denied that every word he said was calculated to deceive the shareholders into thinking that the premium was for the 18 months consultancy and no other reason. It was put to the defender that he deliberately suppressed the full story of how the deal was reached because he appreciated that the board would not accept the deal if it was known that a better bargain had been changed at his insistence. The defender denied that interpretation. The feeling the defender had was that SPX valued the role he had played and felt that it should be recognised. He could not recall if anyone said that. However that is the way it was put to him. The uplift was compensation to him as a reward for his efforts. In terms of Mr Cassells' note, the defender stated that "it was for agreeing to work for 18 months". Mr Campbell denied that he was making things up as he went along. He had worked for the company for 35 years. A lot of the analysis that was going on now was not in conscious thought at the time. He was simply trying to obtain the best deal. The defender stated that he reckoned that what he had put in justified a good return.
 It was suggested to the defender that he regarded LAGTA as his company. "In many ways this was so - the directors were there once a month - I had to run it as my company. ... I never regarded it as mine". The defender stated that it did not cross his mind that £5.125m without a differential would have increased the share price for the other shareholders above £21.50. He gave no thought to this. It was put to him that he had tried to deceive the board by giving the impression that the extra £160,000 related to the consultancy arrangement. The defender denied any attempt to deceive the board at any time.
 The defender did not mention the premium in the first draft of the letters to shareholders because it was going to other shareholders. He then "realised the error of his ways". Mr McLew was not happy with the letter. He said that the defender would have to let the other shareholders know. It had to be disclosed. The defender accepted that the board did not sanction the terms of the letter circulated to shareholders. There was a tight timescale. It did not enter the defender's mind to fax the document to other directors for approval. The defender accepted that he was advised of the need for shares to be treated equally. The letter was redrafted. His draft was "torn to shreds". Thereafter the matter was passed to Stuart McNeill of Messrs Holmes MacKillop. The board did not see the letter nor any of its drafts. It was put to the defender that he did not want to inform the shareholders of the higher premium. He replied that he said to Mr McLew - what is the need for me to tell them? He was "hauled over the coals" by Mr McLew. Unless he did so he would be misleading them and in breach of his duties. The circular letter to shareholders stated that the enhanced share price was "to reflect the 18 months consultancy period". The defender stated that by this time the letter was a "final distillation of many minds more attuned to this work - I was happy to sign it - bearing in mind the background". Mr Sandison suggested that it would be read as the share premium being payment for the 18 months. The defender accepted that it could be read in that way. The word "reflect" was not his word. Mr Cassells was responsible for the drafting of that paragraph. The defender accepted that he signed the letter, and that it would not be clear to anyone reading the letter that the wording was a proposal put to the defender for him to sign. Somewhat reluctantly, the defender agreed that any recipient of the letter would assume that he was the author. The defender was the only shareholder who knew the background as to the development of the letter. It was put to the defender that the letter was designed to deceive the recipients into believing that the premium was payment for the consultancy period. The defender denied this. When asked if he considered the impression likely to be conveyed, the defender indicated that he was not a mind reader. The letter was created by professionals. Everyone did their best knowing that there were tight timescales.
 With respect to the warranties agreement, the defender was asked whether, if each shareholder was receiving an equal division of the price (just over £22), would he have taken the risk regarding the first £250,000 of any warranty claim. For the defender this was a hypothetical question which he could not answer. As to the compromise agreement, so far as the defender could recall no other member of the board was contacted or asked to contribute towards that agreement. In June/July the defender was not aware that there would be such an agreement. It was the new owner who terminated the defender's employment with the company. This occurred after the shares were sold to SPX. The old board did not terminate his employment. The defender agreed that the terms of the consultancy agreement were not drawn to the attention of the old LAGTA board. The same applied to the compromise agreement.
 Within a week of the consultancy agreement the defender had set up a company as a vehicle to provide the services. This was at the behest of Ms Berchtold. The company never finalised accounts. The defender did not know if any final accounts were in existence. Draft accounts were lodged in evidence. Six months into the consultancy the pursuers made it clear to the new manager of the company that they were unhappy about the defender's consultancy arrangement. At that time the pursuers were one of the company's major customers. The defender was placed on "garden leave" for the remainder of the first year of the consultancy arrangement.
 In re-examination Mr Logan asked the defender: "If the purchase price stayed at £5.125m would you have sought a premium". The defender said, on that hypothesis, he would have sought a premium.
The evidence of
 The defender led Mr Stuart McNeill in evidence. In 2007 he specialised in corporate and commercial work. He spoke to his witness statement. He regarded the company as his client. He did not attend the board meeting of 5 July 2007. He was on holiday when the circular letter to shareholders was first drafted. That matter was handled by his colleague Mr McLew. Mr McLew was unhappy with the defender's original draft of the letter. In particular it was misleading in omitting any reference to the higher price for Mr Campbell's shares. Mr Campbell was unhappy with Mr McLew's suggested revisals. Mr McLew had expressed concerns regarding the defender's fiduciary duties as a director of the company. "My recollection is that Colin Campbell did not want to inform the other shareholders of the higher price to be paid to him, but did so after it was made very clear to him that he must disclose this fact, otherwise his letter would be misleading and in breach of his duties as a director and shareholder of LAGTA to other LAGTA directors and shareholders.
 By the time Mr McNeill returned from holiday, Mr McLew had revised Mr Campbell's letter. The letter was further revised by other parties. Mr McNeill was aware that SPX expected the defender to enter into a consultancy agreement for a period of up to 18 months, the terms of which had still to be negotiated. The first draft of the share purchase agreement reflected that arrangement. It was made clear to Mr McNeill that SPX would not proceed unless Mr Campbell was no longer an employee, hence the compromise agreement, and he would sign a consultancy agreement to assist the new owners. The compromise agreement was a "no brainer", since otherwise no one would enjoy the sale of proceeds. All of this was reflected in the terms of the share purchase agreement. It would be normal to ask the board to approve the terms of the circular letter to the shareholders. Mr McNeill was asked whether he or his firm had seen and approved the finalised letter. He did not recall being asked to approve the letter, however "we had seen it".
 At the board meeting of 14 November Mr McNeill reported on progress as to the share process agreement and related matters. The board asked some questions, especially Mr Donnachie and Mr Maitland who were more familiar with such transactions. Mr Donnachie was concerned as to why every director should give warranties in the same manner as Mr Campbell, who was the only executive director. That was a matter of concern for Mr Donnachie. It was discussed at the board meeting. Mr Donnachie telephoned Mr McNeill a number of times in relation to this matter. Mr Campbell had a meeting with Mr Donnachie concerning this, which did not go well. Mr Donnachie insisted that only Mr Campbell would know everything regarding the company. Reluctantly Mr Campbell agreed to the warranties agreement, which was drafted by Mr McNeill's firm.
 Mr McNeill attended the completion meeting on 30 November. All the directors were present. At the end of the meeting Mr Campbell mentioned his consultancy agreement and that the terms of it had still not been agreed. None of the other directors made any comment or raised any question about the terms of that agreement. Everyone was aware of it, though not of its terms at that point. Mr McNeill was aware that remuneration was involved. He never had any belief or hint that there would be no payment. Mr Campbell was more than anxious to enter into the consultancy agreement. The prospect of remuneration under it was more than attractive. Any comment made to Mr Campbell relating to the compromise agreement was "batted away by him" in strong terms, because without it SPX would not proceed.
 The completion meeting was "shambolic". LAGTA's printers broke down causing significant problems and delay. Mr Campbell placed huge pressure upon the professionals to have all of the documentation agreed and printed. He became very angry and agitated about the delays and difficulties. He used very strong language (in particular to Graeme Cassells) stating that he would not tolerate further delay. Mr McNeill asked Mr Park and Mr Donnachie something along the lines of whether there was anything they wanted to ask or wanted to see. Mr McNeill's memory is that they both declined. The fine details relating to the consultancy agreement were still being discussed on the morning of the completion meeting. All of the legal documents were set out for signing on a large table. "The completion event was the most disorganised that I have ever attended". Parties started to sign documents piecemeal. Mr Campbell was very impatient. The meeting turned into "something of a farce". It was a major task to check that everyone had signed in the correct place. The terms of the consultancy agreement were being discussed between Ms Berchtold and Mr Campbell. The consultancy and compromise agreements were put on the table by the purchaser's solicitors. Everything was there for inspection if anyone wanted to see or ask. There was no formal agenda. At no time were the compromise and consultancy agreements "announced". Mr McNeill had no reason to believe that Mr Campbell had made any commitment of any kind to any of his fellow directors or shareholders that he would not receive a salary. At no time did any shareholder ask Mr McNeill about the terms of the consultancy agreement.
 Mr McNeill was cross examined by Mr Sandison on behalf of the pursuers. He explained that in December 2007, in the course of a visit concerning other matters, he had a conversation with Mr Donnachie. Mr Donnachie mentioned that Mr Campbell had purchased two cars from the pursuers. Mr McNeill commented that that was a good healthy sign, and that Mr Campbell was very happy with the consultancy which was "well remunerated". Mr Donnachie was surprised and indicated that he had understood that would not be the case. He asked for a copy of the "completion bible" (the documentation relating to the completion of the transaction) in a CD format. Mr McNeill was asked if this was a charade on Mr Donnachie's part. He replied - no - he had no reason to believe that Mr Donnachie was anything other than surprised. Subsequently Mr Maitland also asked for the completion bible. Mr Campbell told Mr McNeill that Mr Park and Mr Donnachie felt they had been misled. They had understood that he would not be remunerated for any consultancy.
 Mr McNeill was aware that LAGTA was not in a good financial state. There were worries about it. Some shareholders thought that they may never see any value in their holding. There was talk of insolvency. The shareholders were delighted to discover that Mr Campbell had found a buyer at a significant increased price per share. In Mr McNeill's view he was acting for the shareholders. He took instructions principally from Mr Campbell, and from the directors as a whole at board meetings. Later Mr Campbell was the seller's representative. Many of the shareholders had granted powers of attorney to Mr Campbell. Mr McNeill had no recollection of the compromise agreement being discussed at the completion meeting. Only Mr Campbell gave instructions in relation to it. SPX did not wish Mr Campbell to remain as an employee. (Their own man was Mr Hawkins.) They did want his input/assistance in the transitional period. Otherwise Mr Campbell was surplus to their requirements. The compromise agreement is mentioned in the share purchase agreement at clause 2.16 of schedule 5 at page 91. It was executed by the new board. Mr McNeill perceived no conflict of interest between Mr Campbell and the other shareholders of LAGTA regarding the compromise agreement.
 In relation to the consultancy agreement, Mr McNeill dealt only with Mr Campbell. When asked whether he communicated the terms of the consultancy agreement to the other members of the board, Mr McNeill replied - other than in the broadest of terms, no. On the day Mr Campbell was still trying to resolve the terms of the consultancy agreement. No one raised any point in relation to it. The consultancy was with the new LAGTA board. There was no conflict with or prejudice to the previous shareholders. Mr McNeill explained that, in August, when he returned from holiday, he told Mr Campbell that, as managing director and the only director employee of the company, he had enhanced fiduciary duties. Mr McNeill did not have a discussion regarding payment under the consultancy agreement with any director other than Mr Campbell.
 Evidence was led from Nicholas Howie, a solicitor with Messrs Holmes MacKillop. He spoke to his witness statement. He had been asked to assist Mr McNeill. So far as he was aware it had always been the intention for Mr Campbell to stay on as a consultant in some way. Mr Howie did not attend board meetings. The compromise and consultancy agreements were "tied together" in Mr Howie's mind. SPX wanted a consultancy arrangement, so Mr Campbell had to end his employment.
 Mr Logan led evidence from John Clarke, a solicitor with CCW Business Law. He spoke to his report (production 7/25). Mr Clarke had difficulty in seeing how Mr Campbell's conduct amounted to making "secret profits" from the transaction. A differential price share was anticipated from at least 16 August onwards, and, unlike other shareholders, Mr Campbell had to give up his rights under his employment contract. It was reasonable for Mr Campbell to be rewarded for the consultancy agreement. In any event, if there were any "inconsistencies" in the paperwork, it was the duty of Holmes MacKillop to bring this to the attention of the shareholders before completion.
 A differential share price is fairly rare in Mr Clarke's experience, since all shareholders expect to be treated equally. It could be a source of conflict. There would need to be an understanding on the part of the shareholders as to why one of them is obtaining a premium. Under cross examination Mr Clarke indicated that he was not provided with a narrative of events. He was simply commenting on paperwork presented to him. He had no involvement in the events in 2007. He thinks that he was shown the pleadings. He thought that perhaps the solicitor should have made things clearer to the shareholders.
submissions on behalf of the pursuers
 Mr Sandison provided outline written submissions. He sought decree in terms of the first conclusion, or alternatively the second conclusion of the summons, in the latter case restricted to a principal sum of £39,335.
 With regard to the first conclusion, which is for damages in the sum of £52,058.88, with interest at the rate of 8% per annum from the date of citation until payment, the pursuers claim that they entered into the share purchase agreement on the basis of a false understanding, engendered fraudulently, or at any rate negligently, by the defender. In particular, the understanding was that his remuneration for the consultancy period was to consist of the enhanced share price, totalling £162,684. The submissions made in support of this claim can be summarised as follows.
 The pursuers relied upon the defender to oversee the settlement on their behalf. At the board meeting of 5 July the defender represented that the proposed premium represented the remuneration for his post sale consultancy. He gave reasons as to why this suited him. The quality of the defender's evidence on the events of that meeting can be compared unfavourably with that of Mr Donnachie and Mr Maitland. In the absence of evidence from Mr Cassells, there are limits on the evidential status of his note of that meeting. It is agreed that it is an extract from Mr Cassells' file. It is plain that the formal board minutes are an abbreviated record of what transpired. At the board meeting a clear linkage was made between the premium and payment for work. In contrast to the defender's evidence, Mr Donnachie and Mr Maitland spoke to the statements at the board meeting in a manner which was clear and unequivocal.
 In the letter of 16 August the defender stated that the premium was "to reflect the 18 months consultancy period". There can be no dispute about the terms of that letter. It is consistent with the evidence of Mr Donnachie and Mr Maitland. That said, "reflect" was an odd word to use - possibly "deliberately obscure". Subsequently the defender negotiated an additional remuneration package for himself without any disclosure to the pursuers or other shareholders. At the completion meeting the terms of the consultancy agreement were not raised with the other shareholders. By this time it would have been clear to the defender that the other members of the board were taking no interest in the consultancy and compromise agreements. The compromise agreement has nothing to do with the issue at stake in this action. Having negotiated the remuneration package for his consultancy, the defender did not take any steps to correct the impression in the minds of the pursuers and other shareholders.
 Reference was made to R v Kylsant  1KB 442; Curtis v Chemical Cleaning & Dyeing Co  1 KB 805 and With v O'Flanagan  Ch 575. The question is, would a reasonable person in the circumstances of the pursuers have thought at the time the transaction was entered into that it had been communicated to them that the defender's remuneration for the consultancy period was to consist of the enhanced share price alone? If the defender knew that his actions and statements had engendered a false understanding, yet he did not correct it, his actions were fraudulent.
 The defender's whole approach to the transaction was redolent of deceit. He was the person charged with negotiating the transaction on behalf of others, yet he came away with a little extra something. That is "deeply morally suspect". The defender did not tell the board that the idea of the premium was raised by him, not SPX. He did not tell the board that an offer of £5.125m with no differential was on the table, and was replaced with the ultimate offer at his request. The "tax advantage" justification makes no sense except in the context as understood by Mr Donnachie and Mr Maitland. In his evidence the defender presented a number of ex post facto rationalisations for the share premium, for example a reward for 35 years' work for LAGTA; a reward for a successful negotiation; as a condition of undertaking a larger liability for warranties, etc. None of these were advanced at the time. The board was told an untruth, namely that SPX were insistent that the defender was needed. At most, SPX expressed an interest in retaining the defender, but it was never suggested that the deal would be off if he would not stay. There were no discussions as to the effect on the financial details of the deal if he was determined to leave.
 The defender's account of SPX having stipulated that the amount of the share premium would in no circumstances be made available to other shareholders is not credible. There is no mention of it in the Cassells' note of the 28 June meeting. When the defender gave his account of that meeting, he likewise omitted any mention of the subject. It was first mentioned after he had been prompted by being taken through Mr Cassells' note of the 5 July board meeting.
 In his cross examination the defender twice volunteered that it made no difference to SPX how the amount they were to pay was divided amongst the shareholders. Unchallenged evidence was given by Mr McNeill that the defender did not want to mention the existence of the share price differential in his letter to shareholders, and only agreed to do so after being told, in no uncertain terms, that this was required.
 If not deliberately dishonest, the defender's failure fully to inform the shareholders of the remuneration negotiated for him under the consultancy agreement amounted to a negligent misrepresentation. This was a matter of importance to the pursuers and others regarding the decision to enter into the share purchase agreement. They would not have signed off the deal in the agreed terms if they knew of the separate remuneration for the defender under the consultancy agreement. From an early stage Mr Campbell was aware of his fiduciary duties, not least because he was told of them by Mr McLew and Mr McNeill. Thereafter he knew that he was not entitled to withhold relevant information as to the acquisition. The defender chose not to tell the board about the terms of the consultancy agreement at the meetings on 28 and 30 November. He did not ask the board or the shareholders whether they agreed that this was fair and reasonable. It is not relevant that the pursuers had the opportunity to find out, whether by positive enquiry at the settlement meeting or otherwise, that further remuneration had been negotiated; see Redgrave v Hurd  20 ChD1 per Jessel MR at 13/14. The share price differential was acceptable to the pursuers on the sole basis that it represented the remuneration to be afforded to the defender for his agreeing to act as a consultant after the sale for up to 18 months. Otherwise they would have insisted upon a pro-rata distribution of the purchase price. It is quite clear, not least from the outcome of the warranty issue, that the defender would have gone along with this. The defender was anxious to conclude a deal and obtain a capital sum to enhance his pension. There would have been no sense in SPX refusing to contemplate an equal distribution if that was required to make the deal happen.
 Mr Logan also provided written submissions. So far as Mr Cassells' notes are concerned, counsel relied upon paragraphs 1 and 3 of the Notice to Admit. His notes said that the £162,000 would not come to the other shareholders if rejected by the board. It was submitted that Mr Donnachie admitted that such statements were made to the board. The shareholders' interests were represented by both the solicitors and accountants. Mr Cassells and Messrs Holmes MacKillop were not acting as agents for the defender alone. Thus the shareholders had constructive knowledge of all relevant matters through the awareness of their agents. How a recipient read the 16 August letter would depend upon his state of knowledge. The meaning of it would be clear to anyone present at the 5 July board meeting. It had not been established that the pursuers relied upon the letter of 16 August. On the hypothesis set out by the pursuers, an equal division of the purchase price would have resulted in an additional £1.22 per share. Thus on this hypothesis, their loss is £51,377.86. Account has to be taken of the shares for which an owner was not found. His entitlement was placed on account.
 It was submitted that if Mr Campbell agreed to a sum of money for agreeing to enter into a consultancy, that was equivalent to a retainer, and therefore income, thus tax would require to be paid. The compromise and consultancy agreements were conditions precedent of the deal. The relevant documents were tabled at the completion meeting, though it was accepted that an opportunity to correct a false impression is no defence. There was no evidence that the defender sought to conceal anything.
 The defender has four main lines of defence. These are:
(1) That there was full disclosure of the terms of the agreement as then understood at the board meeting on 5 July 2007.
(2) The terms of the consultancy agreement were well known to the professionals acting for the shareholders, thus there can be no failure to disclose on the part of Mr Campbell.
(3) In any event the defender acted in good faith at all times, thus he should be relieved of any liability in terms of section 727 of the Companies Act 1985 (now section 1157 of the 2006 Act).
(4) The defender did not make a profit, secret or otherwise from the terms of the consultancy agreement, because of the rights which he gave up under the compromise agreement.
While there may have been some degree of overlap, in the main points 2-4 seemed to be prayed in aid in respect of the pursuers' alternative claim based on failure to disclose and failure to obtain consent for the package given to the defender as consultant.
 According to Mr Logan, the starting point is Mr Cassells' note of the meeting of 28 June. Why would Mr Campbell report to the board on a different deal from that which was agreed on 28 June? It is clear from the note that there was no contemplation that the premium was to be Mr Campbell's payment under the consultancy agreement. The position was exactly as described at the meeting on 5 July, namely that it was a condition of the offer that Mr Campbell would enter into a consultancy agreement. What he would obtain from it was unclear. If in due course the purchasers had suggested £30,000 for the consultancy agreement, he would have had no negotiating position other than to walk away from the whole deal, hence he was pleasantly surprised when offered a substantial salary. The pursuers' version of the meeting of 5 July makes no sense in light of the terms of the letter of 5 July from SPX, which said that they expected Mr Campbell to enter into a consultancy agreement for up to 18 months, the terms to be negotiated. No one else thought that there was a link between the premium and the consultancy agreement.  Given the nature of the pursuers' case, Mr Cassells must have been complicit. If the premium was in fact available to the rest of the shareholders, then both Mr Campbell and Mr Cassells must have been untruthful. At the board meeting on 5 July the shareholders were told that the extra money would never be available to them, because if necessary the money would go to Mr Campbell in another way. If Mr Campbell was lying about that, Mr Cassells would have known. If this was said to the shareholders, and it was true, then the first claim falls, since the pursuers would never have received additional money in any event. When asked as to whether Mr Logan's position is that Mr Cassells' note of the 28 June meeting is a reliable record of the meeting, he answered yes, it is a reliable record, but not necessarily a complete one. Simply because the note does not state that the £4.50 would have gone to Mr Campbell in another way, it does not mean that this would not happen. Reliance should be placed upon the contemporary notes of the professionals, who had no axe to grind.
 Mr Logan submitted that there is no evidence that SPX ever adopted the position that Mr Campbell was being paid for the consultancy agreement through the share price. In the event, the purchasers were happy to pay a substantial salary to the defender. Mr McNeill and Mr Howie never contemplated that there would be no payment for the consultancy. Mr Donnachie accepted that Mr McNeill was surprised when it was established in December 2007 that Mr Donnachie was unaware of this. If the deal had been as alleged by the pursuers, it would not be credible for the lawyers acting for the shareholders to be unaware of it. There is no basis for the case of fraud. If the pursuers were to insist upon the case of fraud, then they should have led, or co-operated in the leading of evidence from Mr Cassells, who now lives and works in Australia.
 The minutes of the company for the meeting of 5 July are compatible with Mr Cassells' more detailed note. They were approved by the company at the next board meeting. They state that "SPX were insistent that Mr Campbell stay for a handover period and a consultancy agreement for up to 18 months would be negotiated". The natural reading is that there would be a payment yet to be defined under the consultancy arrangement. The compromise and consultancy agreements themselves are consistent with the defender's version of the agreement with SPX. The pursuers' version fails to explain why the defender gave up his rights under his contract of employment. The defender's position is that he was honour bound to do so, having agreed the variation of the share price in exchange for an undertaking to enter into the consultancy agreement. In the whole circumstances, the proper conclusion is that there was informed consent to the defender's share premium.
 Mr Logan accepted that Mr Donnachie was genuinely surprised when told by Mr McNeill about the payments under the consultancy. "I do not dispute that somehow he persuaded himself that the terms of the deal as he describes them was what happened". The question for the court is whether he was simply not paying sufficient attention and thus failed to understand what he was told, or whether, as alleged by the pursuers, for some reason Mr Cassells and Mr Campbell reported on a different bargain from that which had been entered into with SPX on 28 June, and which was reflected in their letter of 5 July. As to the deal explained at the board meeting of 5 July, Mr Cassells' notes are the best evidence on this. They are consistent with the approved minute of the board meeting and with Mr Campbell's evidence.
 On 5 July the pursuers gave their consent to an arrangement comprising 3 elements:
(1) The LAGTA shares would be bought for a total of £5.2m under deduction of debt. This was to be divided between the shareholders with Mr Campbell receiving £26 per share, and all other shareholders £21.50.
(2) In addition, Mr Campbell was undertaking to enter into a consultancy agreement with the purchasers for a period of up to 18 months, on terms to be agreed.
(3) The basis of the differential in the share price was that "CC was needed to make the deal happen and therefore as compensation for having to work another 18 months ...". Mr Campbell was reluctant to enter into the consultancy agreement, but was willing to do so in order to make the deal happen, provided he was remunerated for doing so.
 Mr Logan asked the court to accept that it was explained to the meeting that, if the uplift in shares was not agreed, the money would go to Mr Campbell in any event, but in a less tax efficient manner. Even Mr Maitland had a recollection of this. There are no averments for a case based upon some kind of conspiracy between Mr Campbell and Mr Cassells. Mr Logan accepted that Mr Campbell did not explain that the premium was his idea. It was enough for him to make it clear that he was receiving it and for a particular reason. That is informed consent. It would be Mr Campbell who would bring the deal down if the board did not agree. He would say "I am not agreeing to the deal unless I get my extra £4.50 per share". The board was told that one way or the other Mr Campbell would receive an extra £4.50 per share. Mr Cassells explained that Mr Campbell was essential to the deal. He wanted paid for this, via the payment for entering into the consultancy agreement. Mr Campbell considered himself entitled to the premium because he was making the deal happen by agreeing to the 18 months consultancy. He was the managing director. He possessed the goodwill etc. Why would he give that up for nothing? There was a commercial logic to the premium. It was an essential element of the deal, which would not have happened without Mr Campbell. Thus Mr Cassells went along with Mr Campbell insisting upon more money for himself. There was informed consent because the agent of the shareholders was involved. Mr Cassells persuaded Mr Campbell that he would not obtain £1m. He persuaded him to allow the shareholders to receive £21.50 per share, and the extra £75,000 allowed Mr Campbell "a bit more". In that respect Mr Cassells was acting for the shareholders. There was no breach of fiduciary duty on 28 June.
 Mr Logan made reference to Ultraframe (UK) Ltd v Fielding  EWHC 1638 at para 9/11, and Grant Estates Ltd v The Royal Bank of Scotland Plc  CSOH 133 at paras 86/88 and 93. It was submitted that Mr Campbell gave his evidence in an honest and credible manner. Unlike that of Mr Donnachie, his evidence was consistent with the paperwork and the surrounding facts and circumstances.
Discussion and decision
on the misrepresentation case
 Earlier I outlined some of what emerges from the contemporary documentation referred to in the evidence (paragraph 14). I think it fair to say that it does not make comfortable reading from the defender's point of view. However, before reaching any conclusions it is necessary to have regard to the evidence from the witnesses at the proof. After due reflection upon the evidence, I see no reason to depart from the fundamentals of the picture painted by the documents.
 The defender was trusted to do his best for the rest of the shareholders. Mr Maitland, who has not made any claim against the defender, gave his evidence in a clear, direct and straightforward manner. In its essentials it supports the pursuers' case. Mr Donnachie was similarly credible and straightforward in the manner in which he gave his evidence. On the dispute as to how and why the warranties agreement came about, Mr Donnachie's version of events was supported by Mr McNeill. On behalf of the defender it is not disputed that both Mr Maitland and Mr Donnachie gained the impression spoken to by them in their evidence. They both understood that the price of their shares was unaffected by the extra money going to the defender. It was not payment for his shares, but for something else, namely the post-acquisition consultancy. Thus, come what may, they were to receive no more than £21.50 per share. Was this a mistaken understanding, and if so, was it caused by a fraudulent or at least negligent misrepresentation (or misrepresentations) by the defender?
 The defender had built up the company over many years. He was the managing director and had sole control of the day to day running of the organisation. In many ways he regarded it as his company. However he owned only just over one quarter of the issued shares. By 2007 LAGTA was in serious financial difficulties. There was a real possibility of insolvency. The defender was 67 years of age and keen to retire. He was looking to the sale of the company as a method of supplementing his pension. When Carter & Carter ended their interest, SPX were the only prospective buyer. The board charged the defender with the responsibility of negotiating a deal with SPX, and if possible, achieving an increased offer - the original being for £4.75m. When the defender entered those negotiations, he had a sense of entitlement to a larger share of the purchase price than his shareholding would justify. He wanted £1m. An increased offer of £5.125m was on the table. At least twice in his evidence, the defender volunteered that it was of no concern to the purchasers how the ultimate price was divided between the shareholders. (In any event this is what one would expect.) After private discussions between the defender and Mr Cassells, it was the defender who proposed a price of £5.2m, with him receiving £26 per share, and the other shareholders £21.50. This was agreeable to SPX, and was subsequently confirmed in their letter of 5 July.
 In his evidence, the defender did not conceal any of this. He said that he felt strongly that he was entitled to more money, mentioning his efforts over the years for the company and the shareholders; the time, etc he would have put into the transaction; and the apparent need to delay his retirement. His position was less consistent as to the link, if any, between the uplift and the consultancy. In general he said that the consultancy arrangement itself, which I think in his mind he distinguished from having to delay his retirement, had nothing to do with the purchase price of his shares. In my view, the driving motivator and the reason for the premium was his sense of entitlement to an enhanced price for his shares. He was the person who had kept LAGTA afloat and pushed it forward over the years. He was certain that the other directors fully understood all this. From time to time the defender also justified his premium in terms of the good deal which he had obtained for the other shareholders.
 The defender reported to the board on 5 July. Three of the nine people present gave evidence - the defender, Mr Donnachie and Mr Maitland. (Mr McNeill and Mr Howie were not in attendance.) Mr Logan conceded that thereafter, and until he was corrected in December 2007, Mr Donnachie was under the impression that he had been told that Mr Campbell's share premium was a tax efficient method of remunerating him for his agreement to stay on as a consultant for up to 18 months after the takeover. He was genuinely surprised when told by Mr McNeill that the defender was being paid a separate salary. Mr Maitland gave evidence to similar effect. At least in part, this understanding was engendered by the reference at the board meeting to the perceived tax advantages in this method of proceeding; that is 10% capital gains tax, as opposed to potentially 40% income tax. There can be no question but that the premium was explained by reference to tax advantages for the defender. The defender accepted as much. However, on 28 June, when the agreement was reached, tax concerns played no part in the reasoning of either the defender or SPX.
 The defender did not wish to disclose the share premium to other shareholders in the circular letter. However, after receiving advice, he signed the letter of 16 August, which explained the premium as: "to reflect the 18 months consultancy period". Parts of the letter were drafted by others, but the defender signed it and decided to send it to the shareholders. He cannot avoid responsibility for its terms. I agree with Mr Sandison's submission that "to reflect" was a somewhat vague and obscure phrase. However, it would set no alarm bells ringing in the minds of Mr Donnachie and Mr Maitland, who could reasonably read it as consistent with their understanding of the position. As Mr Donnachie commented - he could hardly say that he was avoiding tax.
 After the 5 July meeting, the defender was being assisted and advised by Mr Cassells of PKF, and by Mr McLew, and subsequently Mr McNeill and Mr Howie of the company's solicitors. By October there was a draft of the share purchase agreement for consideration, but there were no drafts of the compromise and consultancy agreements until just a few days before the completion meeting on 30 November. They were still being finalised on the day. They were not separately announced, nor explained to those present. They were executed by the defender and representatives of the new board. The completion meeting was "shambolic". It is wholly understandable that Mr Donnachie and Mr Maitland left that meeting with their understanding as to the defender's enhanced share price intact.
 The above can be described as a bare summary of the salient events in the second half of 2007. While I accept Mr Sandison's submission that, in the absence of evidence from Mr Cassells, there is a limit to the weight which can be put upon his notes of meetings, there is no question but that they can be referred to, and both parties made extensive reference to them in evidence and submission. Mr Logan had no reservations as to the use of Mr Cassells' notes. He encouraged the court to rely on them. They have the benefit of being more or less contemporaneous accounts, rendered more useful by the abbreviated nature of the board minutes and the absence of any other written record of the important meeting on 28 June.
 The approved minute of the 5 July board meeting states that a purchase price of £21.50 per share had been negotiated (based on the April balance sheet). On its own this is misleading. The minute states that the gross purchase price was based on the £21.50 for shareholders, with Mr Campbell receiving £26 per share. In so far as the minute contains any explanation for this, it says that "SPX were insistent that Mr Campbell stay for a handover period and a consultancy agreement for up to 18 months would be negotiated". There is no reference to tax efficient mechanisms, and there is no specification of what it is that requires to "be negotiated". However the consultancy is mentioned in the same context as Mr Campbell's premium.
 Mr Cassells' note of the board meeting mentions tax advantages. (In his evidence the defender accepted that the tax efficiency explanation was presented to the board.) At the outset of the note it is said that the negotiation achieved £21.50 per share. Again on its own this is misleading. The initial offer of £5.175m with no premium would have given each shareholder more than £21.50. It also fails to mention that it was Mr Campbell who suggested the increased offer of £5.2m being split as ultimately proposed, thereby benefiting himself at the expense of the others. Mr Cassells then records that he explained to the board that there was "another aspect" to the deal, namely that Mr Campbell would receive £26 per share. That phraseology suggests a separate arrangement, which, in the context of the next part of the note, was related to the proposed consultancy agreement - the terms of which were not agreed, thus "we ...were unsure as to what CC would get". However, the premium of £4.50 per share was described as "compensation for (CC) having to work for another 18 months...equating to about 2 years' salary (£160,000)". According to the note, Mr Campbell then said that he was prepared to work for that length of time (he was 67) in order to make the deal happen, however
"he wished to be compensated for it. He explained that there was an amount which had been added to the price per share as this was potentially more tax efficient for him, however if the other shareholders did not accept it, the difference would not be added to their share price, but would be added as remuneration and would come off the purchase price, but he would not get it in as tax efficient a manner (CC is aware there is a risk he will not get this tax efficiently as (Mr Cassells) has warned him)".
While the accuracy of the note cannot be guaranteed, in the main it is consistent with the impression conveyed to Mr Donnachie and Mr Maitland. They understood that the deal was £21.50 per share, with an extra amount going to Mr Campbell in respect of something else, namely a tax efficient method of remunerating the subsequent consultancy. The defender did not dispute the terms of the note.
 In the course of his evidence the defender offered various justifications or explanations for his premium. However, given that the distribution of the £5.2m among the shareholders was a matter of disinterest to SPX, in my view the premium price to the defender was caused by his sense of entitlement to more money per share than the other shareholders. He asked for it, because he wanted it. It was no more complicated than that. In his mind he had negotiated £21.50 for the others, with a little extra for himself, which, one way or another, would be coming to him in any event, because he deserved it. To the defender, the deal was £21.50 per share, with a premium to him. Notwithstanding SPX's disinterest in the ultimate distribution, he saw the extra £4.50 as his, whatever view was taken by the other members of the board. This would explain his intention not to tell the shareholders of this additional amount until given legal advice that he had to do so. Then, consistently with the general approach taken at the board meeting, it was explained as being referable to, or "to reflect" the consultancy agreement.
 I am of the view that, in the whole circumstances, the fundamental explanation for what happened was Mr Campbell's determination to maximise his share of the purchase price. Reference to the consultancy arrangement became a mechanism for explaining or justifying the uplift. No doubt Mr Campbell appreciated that if he simply said that he had decided that he should have a bigger share, this might not be acceptable to his fellow directors. The emphasis on the consultancy also allowed him to say that, come what may, the uplift would still come to him, but perhaps in a less tax efficient manner.
 In the absence of evidence from Mr Cassells, it would be unfair to reach any definite conclusions as to his state of mind, but, given the terms of his notes of the 28 June and 5 July meetings, it seems clear that he was prepared to proceed on the basis that the negotiations had achieved a share price of £21.50, but with something extra for Mr Campbell, which could be explained, at least in part, on the basis of the need for him to work on for a period after the acquisition.
 It is likely that SPX always expected to pay Mr Campbell a salary for the consultancy agreement. There is nothing to suggest that they saw his premium as referable to remuneration for that service, or indeed as referable to anything else. The fact is that the whole of the £5.2m was payment for the purchase of the shares in the company. SPX negotiated the terms of the consultancy quite separately from the share purchase transaction, and without any reference to the price paid to Mr Campbell for his shares. Mr Logan frequently stressed the SPX understanding of the deal as being supportive of the defence to the action, but, in my view it simply highlights the difficulties for the defender in having so clearly linked the premium to the consultancy at the 5 July meeting and in the circular letter to shareholders. For whatever reason the purchasers were content to accept Mr Campbell's proposal that the £5.2m be divided as suggested, but there is nothing to indicate that they saw it as remuneration for the subsequent consultancy.
 I am satisfied that if the whole matter is considered in the round, Mr Campbell misrepresented the true position in a manner which misled Mr Donnachie and Mr Maitland, and in particular during the 5 July board meeting and again in the 16 August circular letter. On 5 July the defender created the false impression that the deal was £21.50 per share in respect of the purchase of the company, with the extra £4.50 per share for him relating to a tax efficient method of compensating him for something else, namely his agreement to the consultancy. The substance of the misstatement was repeated in the 16 August letter. In fact, the premium had nothing to do with the consultancy. The truth was that the deal was £5.2 million for the company, which amounts to more than £22 per share. The defender received more than the others simply because he asked for it. He asked for it because he felt that he deserved to maximise his share of the sum on offer. He wanted £1 million, but settled for a little less, Mr Cassells having persuaded him that the other shareholders should be allocated £21.50 per share.
 These misrepresentations were still operative on 30 November. Nothing was done to correct matters before the acquisition took place on the basis of the reduced price for the shareholders. The pursuers agreed to the proposed deal in reliance upon the accuracy of the information presented to the board and in the letter to shareholders. If the other shareholders had rejected the premium for Mr Campbell, there is little doubt that the transaction would still have gone ahead. All the surrounding circumstances point in that direction. Furthermore, if the other directors and shareholders had been told the true and full story of how the premium came about, it is very likely that they would have rejected it and insisted on an equal division of the £5.2m. SPX would have had no reason to object to this. SPX did not offer a premium on Mr Campbell's shares because of the consultancy agreement, nor "to reflect it". They offered it because he asked for it, and since they had no interest in how the £5.2m was made up or distributed. It was not true that the extra money was always going to go to the defender. Mr Campbell considered that he was entitled to something extra given all that he had done for the company over many years. No doubt he could also reflect on the fact that he had achieved an increased offer for the other shareholders, with the previous offer of £20 having been considered a good one. Furthermore he could justify the premium to himself, and to others, on the basis that he was having to enter into a consultancy arrangement for perhaps 18 months with the new owners, when otherwise he was ready to retire.
 All of this was Mr Campbell's idea, not SPX's. However he failed to tell this to the board and the other shareholders. One might ask, why did Mr Campbell talk of tax efficiencies at the board meeting? This was never explained - perhaps it was a case of "gilding the lily" - but I can well understand that Mr Donnachie and Mr Maitland considered it explicable only on the basis that the premium was, in some shape or form, remuneration for the consultancy agreement. Why else would it be said? Why else would they accept that their share price was £21.50, as opposed to an equal division of the £5.2m. They were being told that the purchase price for the company was £21.50 per share and that Mr Campbell's premium related to something else - but this was true only in the sense that Mr Campbell (and perhaps also Mr Cassells) saw it in that way.
 Mr McLew was present at the board meeting of 5 July (though not the 28 June meeting). Clearly he was unhappy with the arrangement. He would have preferred to draft the circular letter himself. Presciently, he foresaw "a risk factor" which had to be recognised from both Mr Campbell's and the board's point of view - see his attendance note of 8 August 2007 (production 7/16.2). By the time the letter to shareholders was finalised, Mr McNeill was back from holiday and Mr McLew was out of the picture. In considering Mr McNeill's part in events, it is important to understand that he was not present on either 28 June or 5 July. He saw his task as implementing the decision of the board and assisting with the negotiation and completion of the necessary agreements.
 The question remains - does all of this entitle the pursuers to damages in terms of their first conclusion? In general nobody owes a duty of care in respect of the economic interests of others, but the rule is subject to a number of qualifications. For the present I will leave the issue of fraud to one side, and focus on the pursuers' alternative case of negligent misrepresentation. The defender accepted the responsibility of negotiating a deal with SPX and reporting back to the board and the shareholders in general. It would have been obvious to him that they were relying upon him in respect of any information or advice he tendered, and that if he misled them, they might well suffer financial loss. This was particularly so in respect of information relating to the share price differential. The defender did not attempt to exclude or limit his liability. The board and the other shareholders were relying upon him to act in their interests and obtain a good deal for them. The defender was their representative, and was reporting back in that capacity. He voluntarily assumed responsibility for their economic interests and for the accuracy of any material information which he supplied to them. In essence there was a fiduciary relationship between the defender and the other shareholders. In these circumstances he owed them, including the pursuers, a duty of care not to make carelessly inaccurate or incomplete statements which could foreseeably mislead them and cause them economic loss.
 All the necessary ingredients for a duty of care were present. There was the necessary degree of proximity in the relationship between the parties. To impose a duty of care upon the defender would be fair, just and reasonable. The pursuers were entitled to rely upon the accuracy of the information provided to them, and to assume that no material factor known to the defender would be omitted. The information was being reported to the board and shareholders for a specific purpose in relation to this particular transaction.
 For all the reasons explored earlier, in my view it is clear that the defender's duty of care was breached. It has been proved that if the defender had not justified the premium by reference to the consultancy, but instead had set out the full and proper story in relation to the reason for the premium and how it had come about, the pursuers would not have agreed to it, nor would Mr Maitland. It is probable that the shareholders as a body would have insisted upon an equal per share distribution of the purchase price. In these circumstances, the defender would not have insisted on his premium, or if he did, he would not have received it. The transaction would have proceeded on the basis of equality between the shareholders. The pursuers are entitled to damages for the loss caused to them by their reliance on the defender's negligent misrepresentations.
 The finding of negligent misrepresentation gives the pursuers all they seek in terms of their primary claim. It is unnecessary to decide whether there was a fraudulent scheme on the part of the defender. A fraudulent misrepresentation can be distinguished from a negligent one, in that, in the former case, there is deliberate dishonesty and an intention to cause harm. If the defender did embark down the road of deliberate dishonesty, knowing that he was deceiving the others, he did so in a most reckless manner. At any moment his scheme could be uncovered by any of the professional advisers, and at the completion meeting any shareholder present could enquire into the terms of the consultancy agreement. It is likely that any such deliberate scheme would have required at least the tacit acquiescence of Mr Cassells. In the absence of his evidence I would be reluctant to reach such a conclusion. In any event there is a heavy burden on any party seeking to prove fraud, even though the standard of proof remains on a balance of probabilities. The more serious the allegation, the greater weight required of the proffered evidence. Reference can be made to Lord Nicholls of Birkenhead in Re H & Others  AC 563 at 586; "Built into the preponderance of probability standard is a generous degree of flexibility in respect of the seriousness of the allegation".
 It seems to me to be more likely that the defender managed to persuade himself that he was entitled to a premium, and thus, come what may he would get one. If push came to shove, the other shareholders and SPX would see the merit in his case - or so he thought. In his mind this was not "harming" the pursuers and the other shareholders, because he was simply gaining his just reward for, not least, all that he had done for the company and the shareholders over many years. Furthermore, thanks to him they were obtaining an increased price of £21.50 per share, which, in all the circumstances, was a good result. I have not overlooked that fraud can be committed by reckless conduct. However, I am not prepared to hold that the defender had the necessary deceitful or recklessly dishonest state of mind for fraud. In part it is because of the difficulty of proving fraud that the law has developed liability for negligent misrepresentation (see Thomson "Delictual Liability" 4th ed. 55). Sometimes it will be important to decide whether a misrepresentation is fraudulent or merely negligent, because the former opens up recovery of non-foreseeable losses, but no issue of that nature arises in the present case. In the whole circumstances, I uphold the pursuers' primary claim on the sole basis of negligent misrepresentation by the defender.
 To cover the possibility that the misrepresentation case might fail, Mr Sandison presented submissions in support of an alternative case leading to decree in terms of the second conclusion. Given my decision on the primary claim, this subsidiary claim does not arise for determination, but I will say something about it, and give a general indication of my views. Mr Sandison submitted that, while acting as an agent of the shareholders in respect of the share purchase and ancillary agreements, the defender gained a benefit for himself in the form of the salary paid under the consultancy, all without the knowledge and fully informed consent of the shareholders. The defender had put himself in a position where there was a conflict between his self-interest and his duty of fidelity to his principals. As a result a proportionate share of his consultancy earnings should be given up to the pursuers.
 Mr Sandison submitted that a convenient summary of the relevant legal principles is to be found in the opinion of Lord Nimmo Smith in Commonwealth Oil & Gas Co Ltd v Baxter (2010) SC 156 paragraphs 71/4. No one should put himself in a position where his self-interest and duty conflict. The principal is entitled to the single minded loyalty of his fiduciary. Thus he must not make a profit out of his trust, unless there is fully informed consent. The fiduciary must act in good faith, and not for his own benefit.
 Much of the discussion on this alternative claim concerned whether there was proper disclosure and, if not, whether there was constructive knowledge on the part of the pursuers through the awareness of the company's solicitors or accountants. It seemed to me that often there was a considerable overlap with the relevant issues in respect of the primary claim. At the time of the submissions, and still now after reflection, I am uncertain as to the basic premise of the pursuers' alternative claim. The focus is on the post-acquisition consultancy agreement and the salary paid to the defender. Whatever else, it was known that the defender would be entering into such an arrangement. In principle there was no objection to him being paid for it - albeit it was thought that it would be through the share premium. In the result he was paid separately, but I have difficulty in understanding how, as framed, the alternative submission can stand as a separate claim which, had it arisen, would survive failure of the primary case based on misrepresentation.
 Perhaps more fundamentally, if the share premium issue is put to one side, in what sense was the defender acting as an agent for the pursuers and the other shareholders when negotiating the post-acquisition consultancy transaction? It was a wholly separate matter involving himself and the new board. I might be more understanding of a case that the defender put himself in a position of conflict when negotiating a premium for his shares, and that there was no fully informed consent to that - but this claim concentrates on the post-sale salary, not the share uplift. I am of the view that, in reality, the alternative submission collapses back to a complaint about the share premium and the misapprehension that it was the defender's remuneration for the consultancy.
 If one does focus on the salary earned as a result of the consultancy, it can be noted that there was no active attempt to hide that agreement. It was known to the company's solicitors and accountants. The other shareholders expressed little interest in it, over and above it being an explanation for the share premium. If the £5.2m had been split equally, I suspect that the other shareholders would have had little or no interest in the consultancy arrangement, other than perhaps to wish Mr Campbell well in obtaining a good deal with the new owners. No doubt it might be otherwise if there could be said to be any real conflict between obtaining the best price for the shares on the one hand, and a salary for the consultancy on the other. But, other than in respect of the defender linking them as discussed earlier, in reality they were separate matters.
 There is scope for confusion on this since the primary case does proceed upon the proposition, the valid proposition as I have held, that the defender misrepresented the share premium as relating to remuneration for the consultancy agreement. However, so far as SPX were concerned, they offered £5.2m for the shares as a whole. Though agreeable to couching the letter of 5 July in the terms suggested by Mr Campbell, so far as SPX were concerned it was simply £5.2m for the shares. In reality there was no conflict between gaining the best price for the shares and subsequently obtaining a salary for the consultancy agreement. Some months later SPX negotiated with Mr Campbell quite separately regarding the latter agreement. In those negotiations Mr Campbell was not acting on behalf of the other shareholders, and I can see no basis for any suggestion that his salary as a consultant reduced the price paid for the shares, or otherwise prejudiced the shareholders.
 It was argued by Mr Logan that the salary was a quid pro quo for the compromise agreement - but I doubt if the defender saw it in those terms at the time. There was never any suggestion of him enforcing any claim against the company, but, that said, the coincident compromise agreement may make it more difficult to assert that there was a secret or wrongful profit derived from the consultancy arrangement. On the face of it, it was remuneration for services rendered to the new owners. In short I consider that, if one leaves to one side the allegation of misrepresentation or non-disclosure regarding the true position of the share premium, I detect no breach of fiduciary duty on the part of the defender in negotiating or taking a salary for the consultancy. Thus the question of consent, whether informed, constructive or otherwise, does not arise.
 If the issue had arisen for decision, I would have had difficulty with the proposition that the defender should avoid any liability because of the lawyers' knowledge of the terms of the consultancy agreement. There are contexts in which an agent may have authority (actual or ostensible) to be given notice of certain facts, resulting in deemed or constructive knowledge on the part of the principal, but this is not such a case. Similarly, there can be no question of the solicitors having been given authority to express the shareholders' consent to any agreement or proposed course of action, nor did they ever give such consent. The defender did not impart information to the lawyers on the assumption that they would then inform the shareholders, nor would it have occurred to them to do so. In reality Holmes MacKillop acted for the defender alone in respect of the compromise and consultancy agreements. This was reflected in the terms of their fee note (production 7/20).
Section 727 of
the 1985 Act
 For completeness I should deal with a submission presented by Mr Logan based upon section 727 of the Companies Act 1985 (now section 1157 of the 2006 Act). It allows the court to relieve "an officer of a company" from liability, in whole or in part, in any proceedings for "negligence, default, breach of duty or breach of trust" on such terms as the court thinks fit, always provided that he acted honestly and reasonably, and that, in the whole circumstances, the court thinks that he ought fairly to be so excused.
 Even assuming that it is competent to apply the section in the present case, in my view the circumstances are such that it would not be appropriate to do so. In any event, the case law makes it clear that the statutory relief can apply only in respect of a claim by a company, or by the shareholders on behalf of the company, against, for example, a director in respect of his duties to the company or under the Companies Act (Customs and Excise Commissioners v Hedon Alpha Ltd  1 QB 818). The present action is not brought by or on behalf of the company - it is a personal claim by the pursuers in respect of a duty owed to them. Further, the conduct complained of was not done in the capacity of a director or officer of the company. For these purposes Mr Campbell was a representative of the shareholders in respect of a proposed share purchase transaction with SPX. He was not dealing with company affairs, nor in respect of his duties under the Companies Acts.
 There was a small difference between counsel as to the precise quantification of the pursuers' claim in terms of the first conclusion. I shall adopt Mr Logan's calculation. Thus I shall dispose of the action by granting decree in terms of the first conclusion of the summons in the sum of £51,377.86, with interest. I shall reserve all questions of expenses.