1. Origin: The statutory derivative action is a legal provision that is provided by the law or statute, specifically the Companies Act 2006 in the UK. On the other hand, the common law derivative action is based on case law or precedents set by court judgments.

2. Scope: The statutory derivative action is broader in scope as it can be brought by a shareholder on behalf of the company for any wrong done to the company. The common law derivative action, however, is narrower in scope as it can only be brought for frauds committed by directors and where the majority of shareholders are unable to ratify the fraud.

3. Procedure: The procedure for bringing a statutory derivative action is clearly laid out in the Companies Act 2006. It involves obtaining the court's permission to continue the claim. The procedure for a common law derivative action is less clear and can be more complex.

4. Ratification: In a statutory derivative action, a majority of independent shareholders can ratify the conduct, effectively blocking the action. In a common law derivative action, ratification is only possible if all shareholders agree to it.

Question

1. Origin: The statutory derivative action is a legal provision that is provided by the law or statute, specifically the Companies Act 2006 in the UK. On the other hand, the common law derivative action is based on case law or precedents set by court judgments.

2. Scope: The statutory derivative action is broader in scope as it can be brought by a shareholder on behalf of the company for any wrong done to the company. The common law derivative action, however, is narrower in scope as it can only be brought for frauds committed by directors and where the majority of shareholders are unable to ratify the fraud.

3. Procedure: The procedure for bringing a statutory derivative action is clearly laid out in the Companies Act 2006. It involves obtaining the court's permission to continue the claim. The procedure for a common law derivative action is less clear and can be more complex.

4. Ratification: In a statutory derivative action, a majority of independent shareholders can ratify the conduct, effectively blocking the action. In a common law derivative action, ratification is only possible if all shareholders agree to it.

Knowee AI · Accepted Answer

1. Origin: The statutory derivative action is a legal provision that is provided by the law or statute, specifically the Companies Act 2006 in the UK. On the other hand, the common law derivative action is based on case law or precedents set by court judgments.

2. Scope: The statutory derivative action is broader in scope as it can be brought by a shareholder on behalf of the company for any wrong done to the company. The common law derivative action, however, is narrower in scope as it can only be brought for frauds committed by directors and where the majority of shareholders are unable to ratify the fraud.

3. Procedure: The procedure for bringing a statutory derivative action is clearly laid out in the Companies Act 2006. It involves obtaining the court's permission to continue the claim. The procedure for a common law derivative action is less clear and can be more complex.

4. Ratification: In a statutory derivative action, a majority of independent shareholders can ratify the conduct, effectively blocking the action. In a common law derivative action, ratification is only possible if all shareholders agree to it.

Identify at least two differences between the statutory derivative action and thecommon law derivative action

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Identify at least two differences between the statutory derivative action and the common law derivative action

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