Event of Death of the sole director of the company

Event of Death of the sole director of the company

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Can anyone tell me, if sole director has been passed away then who can sign the accounts? Legal hairs ? Please note company has a secretary also. 

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By johngroganjga
21st Oct 2013 15:29

There is no particular problem unless the deceased was the sole shareholder as well as the sole director.

Unless that is the case, the surviving shareholders just appoint  a new director.

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By Chintan
21st Oct 2013 15:34

He was a sole shareholder.. What should be done now ?

 

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By johngroganjga
21st Oct 2013 15:41

Well I think strictly speaking you need to wait until will is proved or letters of administration are granted so that executor or personal administrator can vote a new director into office.

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By steveoneill
22nd Oct 2013 13:06

Depends on the articles of asociation

This is one of those problems with the model articles under the 2006 Act, if the situation is the company has model articles, then when the sole shareholder/director (and there is no secretary) dies the relatives have the right to the income from the shares, but they cannot appoint a director, this also applies to the transfer of shares, in that scenario the assets belong to the Crown. This is because there is no current appointed officer to make the relevant entries into the registers of the company

If the articles the company uses was under the 1985/89 Act this does not apply, if however it was incorporated after October 2009 you need to check the articles, the one we use for incorporation for our clients we have the following clauses inserted into the articles as standard, called a living will clause, which gets around the scenario under the 2006 Companies Act.

(3)          In any case where, as a result of death, the Company has no shareholders and no directors, the personal representatives of the last shareholder to have died have the right, by notice in writing, to appoint a person to be a director.

(4)          For the purposes of paragraph (3), where 2 or more shareholders die in circumstances rendering it uncertain who was the last to die, a younger shareholder is deemed to have survived an older shareholder.

If you are under model articles then the only place that decide the outcome is the Courts.

Steve ONeill

Business Tax Centre Ltd

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By Chintan
22nd Oct 2013 15:07

Actually our client was incorporated in 2006 so i guess it can not be covered under model articles. 

I will check in their articles. 

Many thanks for your help

 

 

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