Can Directors be removed without consequence?

Can Directors be removed without consequence?

Didn't find your answer?

I've recently taken over our residents association and am trying to add my name as a signatory on the bank account. The bank are saying that there are a number of historic issues with the account in that they don't have personal details for a number of the directors listed on Companies House.  This makes sense as since any last changes to the bank have been made, new directors have been added.  The set up of the RA is that its a limited company with every flat owner holding one share and equal voting rights.  Historically, all owners were then made directors for the life of their flat ownership.  As the bank are refusing to make any changes till they have all details for all directors and some of them we can't get hold of (don't live in the UK), I was wondering whether it would be possible to remove all directors apart from a couple who live in the building (and are therefore actively involved in the management of the building), and allow all the owners to retain their powers.  I.e. they'll still be involved in the decision making and come to the AGM, they just won't be listed as a director unless they can assure us they will be available to sign paperwork when needed?

Basically - is there a negative consequence to removing the directors from Companies House provided we still treat them as having the same powers and voting rights?

Replies (4)

Please login or register to join the discussion.

paddle steamer
By DJKL
21st Aug 2014 10:08

What do Articles/ Constitution say?

 

The structure where each shareholder is a  director does seem somewhat cumbersome. Are there a lot of flats?

Given you say each flat owner is already a shareholder then AGM voting would not appear to be restricted if the flat owner were not a director. (Subject to the voting rights ascribed to the shares)

What do the Association's Articles of Association ( and possibly constitution, if one exists) say about the required mechanics re the forceable removal of a director? i.e. EGM/AGM/ Notice of meetings etc.

Thanks (0)
avatar
By duncanedwards
21st Aug 2014 10:22

You say

"Historically, all owners were then made directors for the life of their flat ownership."

Presumably, as DJKL suggests, this happens under the terms of some legal agreement.  That being the case, you can't, I would have thought, just remove them because it suits the current circumstances. 
 

The person who dealt with the RA previously has really dropped you in it!

Thanks (0)
By Democratus
21st Aug 2014 12:08

Are the shareholders aware...

... of the difference between shareholder and director. I would like to choose to be a director rather than automatically be appointed; presumably the conveyancing contracts deal with this and the buyers agree to the role as part of the acquisition of the leasehold.

You may wish to call an Extraordinary GM and agree a new way of doing things - this may overcome the current hiatus.

 

Thanks (0)
avatar
By bernard michael
21st Aug 2014 15:02

The Articles may state that the flat owners shall be directors only as long as they remain owners.

I agree the Articles are your first port of call

Thanks (0)