Fiduciary liability of directors can justify arrest in execution where misfeasance makes them accountable for the decretal amount.

A director occupies a fiduciary position toward the company and its members, and a breach of that duty causing loss may be treated as misfeasance amounting to breach of trust. On that footing, a decree obtained in misfeasance proceedings was held to fall within the proviso to section 51 of the Code of Civil Procedure, because the director was bound to account in a fiduciary capacity for the amount decreed. The decree could not be reopened in execution, and arrest in execution was therefore upheld. The principle is that fiduciary liability arising from breach of directors' duties can justify arrest under section 51 where the decretal amount represents a sum for which the director must account.

---

---

Issues: Whether a director against whom a decree had been passed in misfeasance proceedings could be arrested in execution under section 51 of the Code of Civil Procedure on the footing that the decree was for money for which he was bound to account in a fiduciary capacity.

Analysis: A director, though not an express trustee, occupies a fiduciary position in relation to the company and its members. His duty to supervise and manage the company's affairs and to deal properly with property under his control makes him liable to account where loss is caused by breach of that duty. Misfeasance by a director, in this context, is treated as a breach of trust. The Court held that the decree itself could not be re-opened in execution, and the finding that the loss resulted from the appellant's failure to perform his duty brought the case within clause (c) of the proviso to section 51.

Conclusion: The order for arrest was validly made, and the appeal failed.

Ratio Decidendi: A director who, by breach of his fiduciary duties, becomes liable to make good loss to the company can be treated as a person bound in a fiduciary capacity to account for the decretal amount, thereby attracting arrest in execution under section 51 of the Code of Civil Procedure.

---