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Removing a Director
Jennifer's interesting article rightly references the case law and the various rights of action. But for directors/shareholders to even talk about such rights, in an attempt to protect themselves, can quickly become a self-fulfilling prophecy and, before you know it, large amounts of personal monies are being drained away in litigation.......and usually the trading of the company and the confidence of staff begins to erode.
I suggest, as I am sure many do, once you become aware of a rift, is to encourage the shareholders and director(s) in question to try to access facilities to help them reach an agreed solution whether with or without resignation of the director(s) concerned.
I have advice on this area on my specialist site at www.BoardroomResolve.com and give a lot of advice to queries from the public on the subject on the Legal section of the sister forum at UK Business Forum - btw my comments are categorised into different issues that arise between sheaeholders also at www.TheResolver.com .
removing directors with written resolutions??
In the paragraph "Removal of directors", I don't see how the change to CA 2006 s296(4) "made a useful procedural change in the allowing of written resolutions." is relevant to removing directors,as section 168 requires an ordinary resolution at a meeting, and a written resolution wouldn't be applicable...
http://www.legislation.gov.uk/ukpga/2006/46/section/168
Removing Director with written resolution
Am I correct in my understanding of s239 CA2006?
Where the members wish to pass a resolution to ratify conduct of a director that amounts to negligence, default, breach of duty or breach of trust, this must be done by means of a resolution in respect of which the votes of the director concerned (if she is a member of the company) must be disregarded. By virtue of this provision, a single director, if also a member of the company, would not be able to vote on a motion to ratify his/her own breach, only other members would be allowed to vote.
Where the resolution is proposed as a written resolution, neither the director concerned nor any member connected with her (e.g. spouse and shareholder?) is an eligible member.
Does this mean neither the director nor his/her spouse are permitted to vote on such a resolution, and therefore the majority shareholder(s) can vote to remove the offending director and immediately replace him/her with a director of their choosing?
I would very much appreciate your informed view of this.
Removal of Director
Hi,
I am a Director of a Community Interest Company, Limited by Guarantee. There are five Directors in total. In recent months there have been many unpleasant situations caused by one of the Directors, resulting in unnecessary delays in decision making and a well documented email trail of disrespectful comments and unfounded accusations. Three out of the five Directors find it impossible to work with this particular person and want them dismissed immediately. I have researched the procedures on line and it seems a rather straigh-forward process- as none of us are officially employed by the Company and we all carry our duties on voluntary basis. Has anybody on here gone through the process or could offer any tips to ensure that all processes are followed? Advice would be greatly appreciated.
Sylvia