Getting rid of a Director for breach of lease

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    Getting rid of a Director for breach of lease

    We are a share of freehold company of 10 flats with 4 directors. Unfortunately one director is a rogue director who only does what he wants to do. The latestis that he refuses to pay for the increased service charge (£100 per year) from 2010 because he states it was not agreed. He was present at the meeting when it was decided to increase the charge. He was the only director to vote against it. He is the only leaseholder who has not paid it.

    There has not been a sinking fund raised even though the lease allows for it. We need to do major works, the S20 has been sent, but we know he will not agree to it or pay for it. So we will have to go down the 146 route to get paid.

    We would like to get him removed as a director as he is clearly failing as a director in looking after the interests of the block. Our Company articles allow for us to get rid of a director if he sells. As he will be in breach of the lease can we vote to get rid of him?

    #2
    Yes you can vote to get rid of him.

    You call a general Directors meeting giving 14 clear days notice
    ( suggest you give 21 days )

    The notice must state the reason for the meeting.

    The offending Director must be given a letter in addition, to
    advise him the meeting is to dispence with his services.
    ( No need to give reasons )

    Assuming 4 of you there, meeting will take 2 minutes.
    MAKE sure the other 3 WILL vote to dismiss him.

    Show of hands to agree dismissal of director. Job done.
    Hold the meeting in the cycle sheds if you like, so you don't
    have to have him in one of the flats.

    Other reasons to get rid of a director, is as follows :-=

    Some info for you :-

    Re-print from internet, from "Those in the know"
     
    Many Directors or Officers of Residential Property Management
    Associations/Companies are unawarethat they could be held
    personally liable for their actions.

    What is a ‘wrongful act’?
    ‘Wrongful act’ includes breach of duty or trust, neglect, error,
    misstatement, misleading statement,omission, negligent act
    or any other act wrongfully committed.

    Who could make a claim against you as a director or officer?

    Any person that may have an interest in the affairs of your
    company could make a claim.
    For example,
    this might include creditors, government departments and/or
    regulatory authorities and indeed theindividual flat owners you
    represent.

    How might a claim arise?
    There are various duties imposed upon you as a director or
    officer including:

    (i)Common law dutieslegal principles established from many
    years of case law.

    (ii)Fiduciary duties
    to act honestly.
    to act in good faith.
    to act in the best interests of the company at all times.
    not allowing personal interests to conflict with those of
    the company.

    (iii)Duties of skill and care
    to exercise the same level of care that a person would use
    in the management of their own affairs. To exercise the level
    of skill expected from a person with their knowledge and
    experience.

    (iv)Statutory duties
    Where an offence under an Act is committed by a Company
    with the consent or connivance of a director, or is attributable
    to his neglect, that director is also guilty of the same criminal
    offence and can be punished accordingly.

    _______________________________

    R.a.M.

    Comment


      #3
      Thank you for that. Unfortunately 2 of the directors do not live in the country so getting all 4 together is very difficult. Is there any way else we can organize the vote?

      Which site was "those in the know" from.

      Comment


        #4
        Originally posted by bbva View Post
        Th Is there any way else we can organize the vote?
        Which site was "those in the know" from.
        "those in the know" - i can't remeber, i just copy info that is known
        to be true and reliable ( not just comments on here ).

        You call an Extraordinary Directors meeting.
        you issue a proxy form allowing those who cannot attend, to
        post or email back the proxy form. But every Director must have
        a proxy form.
        You state you will be the chairman of the meeting.

        Go to the meeting, and it will be only you and the bad director.
        Start the meeting, ask for a vote to dismiss the director,
        you put your hand up, and other does not, then read out the proxy
        votes from theothers, and count the votes in favour if dismissing
        the director
        State Forthwith Mr, X is no longer a director, and this meeting is closed.

        I have a proxy for appointing directors, but not one for dismissing
        one, so if i have time tonight, will alter and place on
        http://ram2.hostbyet2.com/

        Worth a look at while you are waiting.

        Comment


          #5
          Look at Proxy Form
          at http://ram2.hostbyet2.com/

          Comment


            #6
            Originally posted by bbva View Post
            Thank you for that. Unfortunately 2 of the directors do not live in the country so getting all 4 together is very difficult. Is there any way else we can organize the vote?

            Which site was "those in the know" from.
            Obtain their proxy or signed resolution to remove X as a director for failing to act in the

            to act in the best interests of the company at all times.
            not allowing personal interests to conflict with those of
            the company

            as RAM has posted from the Companies Act 2006, on the basis that he refuses to pay a service charge agreed on date by a majority of 3 to 1.

            A furher resolution should be made that "atlo" when the Notice of estimates expires you will address any queries and give him 7 days to pay dispute or mediate and then you apply to the LVT.
            Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

            Comment


              #7
              Many thanks for your replies. He has also committed fraud, fabricated emails, false accusations, the list goes on.

              Our company articles are governed by the Companies Act 1985 which are quite lacking. Can we use the Companies Act 2006 as quoted above?

              Comment


                #8
                To be honest, you just call a directors meeting, vote to dismiss the
                director. 3 against 1, Motion carried.

                If he has breached the 1985 and 2006 companies act, fraud,
                fabricated emails then he has broken the law.
                Instant dismissal, no contest.

                you have you reasons already :-
                failing to act in the best interests of the company at all times.
                Allowing personal interests to conflict with those of
                the company.

                Job done.

                Comment


                  #9
                  Originally posted by bbva View Post
                  Many thanks for your replies. He has also committed fraud, fabricated emails, false accusations, the list goes on.

                  Our company articles are governed by the Companies Act 1985 which are quite lacking. Can we use the Companies Act 2006 as quoted above?

                  Yes- CA 2006 has superceded CA 1985

                  http://en.wikipedia.org/wiki/Companies_Act_2006

                  Comment

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