Company Officers-directors Flashcards
What are the 9 types of directors?
DeFacto DeJure Alternate Managing Executive Non executive Chairman Chief executive Shadow
What 2 ways can they be removed?
Special notice - 28 days
Ordinary resolution >50%
Disqualification What might they be? What might they do persistently? If they trade what? If they have or commit a? What may they breach?
Unfit for management Breach CA06 Fraudulent or wrongful Criminal offence Disqualification
Duties What must they act within? What must they promote? What must they avoid? How must they judge? What must they act with?(3) What must they not do?
Powers Success of the company Conflicts of interest Independent judgement Skill, care and diligence Accept benefits from 3rd parties
Powers
3 ways?
What is E?
What is I?(3)
What is A? When can’t 3rd party rely on this?
Express
Implied
Apparent
•Authority explicitly given from P to A
- Reasonably incidental to performance of expressly authorised act
- not ben expressly prohibited by P
- agent occupying position would normally have authority to do
•where A is held out by P as having authority because,
1) appointed to position
2) previous dealings
3rd party can’t rely on when knows lack of actual authority
Freeman and Lockyer v Bruckhurst Properties
Explain case
4 directors
1 did all the contracts
Acted as managing director but wasn’t
Other directors said doesn’t count tried not to follow through with one contract
Company was liable as director had necessary authority
Agency estoppel was created
Appointment of directors How old must they be? What is the first director? What two ways are they appointed? When must they notify companies house of new appointment? What are service contracts? What compensation do they receive? What do the model aricles public company require?
16 or over
Named in application for registration of the company
Appointed by existing directors or ordinary resolution
Within 14 days of new appointment
Means director can’t exceed 2 years unless approved by ordinary resolution of stakeholders
Gratuitous payments must be disclosed to all members and approved
All directors retire at first agm and offer for re election
Each agm half retire and can be re elected
Types of directors
What is DeJure?
DeFacto?
Managing?
Formally or legally appointed or elected as per articles
Not DeJure but performs acts and duties of director
Articles allow board to delegate to any duties they see fit
Types of directors
Shadow?
Executive?
Non executive?
Person with whose directions/instructions the directors are accustomed to act. Not a shadow director if advice given only in professional capacity.
Likely to be a full time employee involved in management
Part time, brings expertise to the board not an employee
Types of directors
Chairman
Chief exec
Alternate
Chairs meetings of board. Acts as spokesperson for company and has casting vote.
Responsible for leadership of the company and managing it within powers authorities delegated by board
Appointed by a director to attend and vote in board meetings when they cannot attend
What is wrongful trading?
What is fraudulent trading?
Trading when company goes into insolvent liquidation
When business of a company continues with intent to defraud creditors or for any fraudulent purpose
