Director position and lease

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    Director position and lease

    Many leases require directors to retire in rotation from the position. Some permit re election. If there is dissatisfaction with a director what are the advantages/disadvantages of allowing that director to continue in the role.? No fixed view and would welcome other opinions.

    #2
    This is normally in the articles of association, not the lease. The re-elect a third every year rule was in the standard model articles. Similar rules apply in the constitution of some unincorporated societies.

    The reason some articles limit the number of re-elections is basically the same as the reason that US presidents can only serve two terms. The re-elections are similar to the requirement to have a UK general election at lease every few years.

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      #3
      Oops. It is noticeable on this forum the polite answers given even when someone has made a silly mistake. The lease gives the obligation to be a director of duly elected. Unfortunately people have just remained directors. Personally I think it would be better to ensure rotation. However this has not happened.
      is it worth trying to make this happen, even if it means losing good directors ?
      Core question. Is it better not to re elect retiring director or keep on the board ? Are they better, even if negative, kept in or left sniping from the side ?
      Thanks

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        #4
        Breaching one rule tends to be the thin end of the edge for breaking many rules.

        On the other hand such rules are probably unrealistic in these days where no-one competent wants to be a director..

        I'm surprised that the lease goes into this level of detail regarding the company. I'd go as far as to say that paints a false picture of the company to any outsider, who will only see the articles. If it is in the lease, you are probably stuck with it.

        If it is the normal place, the articles, you can use a special resolution to change it, probably to one that still requires periodic resignations, but doesn't restrict the number of times re-elected.

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          #5
          Yes, there does appear generally to be a lack of competent, or even incompetent, people willing to take on any responsibility. Thanks.

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