Shareholders and Directors

Question 1

If a director who is also a shareholder wishes to grant themselves a loan from the company, can they vote in the capacity as a shareholder?

Answer 1

Yes, the provision under MA14 does not apply to shareholders

Question 2

When is the director’s duty to not accept benefits from third parties breached?

Answer 2

If the benefit is likely to give rise to a conflict of interest. If it does not then it does not amount to a breach

Question 3

How can a minority shareholder bring a claim against a company?

Answer 3

They can bring a statutory derivative claim on the company’s behalf and will need to apply for the court’s permission.
If it is clear the shareholder will not get majority votes in a resolution the courts will not allow permission

Question 4

What is a non-executive director?

Answer 4

They do not have service contracts (an employee).
Do not have a salary but receive director’s fees.

Question 5

What is an executive director?

Answer 5

A director who also has an employment contract.