RTM Co Director Termination - Possible Error in Articles

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    RTM Co Director Termination - Possible Error in Articles

    Hello again, I have a few questions on the validity of director termination.
    I was of the understanding that a director of an RTM Co can be voted off by the members, yet it seems we have a set of articles that dont include that term. s23 of our articles state:

    Termination... (shortened version)

    23. A person ceases to be a director as soon as -

    a) any provision of companies act...
    b) a bankruptcy order...
    c) a composition with creditors...
    d) a registered medical practitioner....
    e) by reason of mental health....
    f) notification of resignation...


    There is no mention of a member vote, does that mean a director cannot be removed? Are our articles missing a clause and, if so, are they valid?

    tks again in advance for any help.


    #2
    RTM articles are fixed, and the ones that you quote do have that term. It is the one labelled (a). I don't believe the articles could remove any of the relevant provisions in the Companies Act!

    Item (a) includes section 168 of the Act, amongst others, by reference and that is the basis for the members removing a director:

    https://www.legislation.gov.uk/ukpga...46/section/168

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      #3
      Tks 64, much appreciated.

      Comment


        #4
        It seems that the other directors have held a board meeting to boot me off; I tend to be a thorn in their side by sticking to rules, and it would seem they've decided to take action and had a meeting to decide to remove me.
        However, I wasnt advised of that meeting - required under s14(3) of the articles and I'm told the meeting wasnt minuted.

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          #5
          The directors cannot remove you. Only a general meeting can do that, and only with 28 clear days notice and the opportunity for you circulate reasons as to why you should not be removed.

          This is an essential protection for dissident directors, who may better reflect the members view than the majority directors. Obviously it is most relevant for public companies and large incorporated clubs and societies, where the number of members can be much larger than the number of directors.

          You might, of course, be better off not as a director as if you are in a minority, with directors who don't understand the law, you need to protect your back by ensuring accurate minutes of your objections to their illegal proposals. That might mean you have to take the minutes, yourself.

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            #6
            Tks again for your reply. Articles state quorum for general meeting is 20% of members. Is that right? Can just 20% vote to remove a director?

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              #7
              If the agent , from your other thread, is company secretary, they need firing as company secretary if they submitted the TM01 for you.

              I don't know what response you will get from Companies House, but it is probably worth challenging the TM01, pointing out that sections 168 and 169 of the Act were flagrantly ignored, and there was no member vote.

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                #8
                20% can, if 100% are invited. You would have four weeks in which to encourage others to either attend or appoint a proxy.

                Actually less that 20% can remove you, You only need a simple majority of those at the meeting or present by proxy, so if 20% are represented, and all vote, just over 10% is sufficient, but some could abstain.

                If you can't get half the members to vote, in person, or by proxy, for you, maybe you don't really represent the leaseholders.

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                  #9
                  Originally posted by leaseholder64 View Post
                  If you can't get half the members to vote, in person, or by proxy, for you, maybe you don't really represent the leaseholders.
                  Ha, a very good point, but it doesnt take into consideration the fact that most leaseholders really dont give a sh1t about getting involved, can't be bothered to attend meetings, and only ever get involved if their service charges exceed expectations or to moan about major works fees.

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                    #10
                    That works both ways. The directors will be similarly limited in getting support, even if they start with a larger number.

                    In any case, removing a director is quite drastic, and you may be able to convince people that having no dissenting voice is bad for them. However I do understand how apathetic people, particularly absentee landlords (although I think you said you had none) can be.

                    Personally, though, I wouldn't want to be a minority director where the majority weren't trying to achieve a consensus.

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                      #11
                      Originally posted by leaseholder64 View Post
                      Personally, though, I wouldn't want to be a minority director where the majority weren't trying to achieve a consensus.
                      Yeah, I get it, me too. But I kind of feel I have a responsibility, since nobody else can be bothered. It also really annoys me that they've "forgotten" to take minutes of meetings, "forgotten" to file annual returns, "forgotten" to comply with articles...
                      Perhaps I should suggest to the members that ALL directors should be up for change?

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                        #12
                        If you stay and they are not taking minutes, you need to take them, yourself.

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                          #13
                          You could also file annual returns yourself. As a director, you are jointly responsible for the failings.

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