joint owner shareholder of freehold - director?

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    joint owner shareholder of freehold - director?

    In our block of 4 flats one flat has now sold and it has been bought by a father and son jointly.

    Within the block, We own a company which was created for the purposes of holding the freehold. Each owner has one share.

    I understand that the new owners of the flat will jointly hold the one share of the freehold company (after the resignation of the previous director). What I am not clear on is the appointment of directors within the freehold company. Previously, with four individual owners of the 4 flats, each one of us was a director (thus 4 directors). However, with one flat now being purchased as a joint ownership, how would the appointment within the company work? Would the joint owners of this flat be two directors appointed (resulting in 5 directors), or only one of the two will be appointed (maintaining the 4 directors dynamic)? I assume Companies House will not allow a joint appointment as "one director"...

    I apologise if the questions seem rather simplistic, but I hope someone may be able to help.


    They need to nominate one lead shareholder of the pair. Whatever the case they only ever have one joint vote.


      Why are you wanting to give a complete stranger, with no references as to his abilities to perform the duties of a Director, a directorship ?
      Is he / they conversant in leasehold matters, have they ever been a Director before ?

      If your lease / articles insist on giving untrained leaseholders a Directorship, then you have to, at your time and expense, set up a training program to educate them.
      Show them your copy of the Companies Act 2006, talk them through the "Lessor" responsibilities in the lease that they have to observe.

      They won't know the first thing about all above.

      Training is given to Plumbers, accountants, welders, solicitors etc,


      see to structure your training


        Thanks for your message which made interesting reading.

        I was approaching the matter from the position that as they had purchased a flat in the property and a share of the freehold, they would also have to become a director of the freehold company. Is this not the case - are the 3 original directors within their rights to refuse to add the new purchaser as a director?


          Originally posted by Roadpipe View Post
          a share of the freehold, they would also have to become a director of the freehold company. Is this not the case - are the 3 original directors within their rights to refuse to add the new purchaser as a director?

          Look at your MEMORANDUM OF ASSOCIATION
          ( as opposed to the Articles of Association )
          If it does not say all shareholders will become Directors, then shareholders are not automatically made Directors.
          It's as simple as that.

          There is no difference in Commercial firms and your firm ( company )
          Directors are chosen on their ability to do the job, and not just because they bought a share in the company, or just happen to lease a flat from the company.
          ( I may have leased a partitioned off building of a large firm, and have also bought some shares in the same company, but it does not give me the right to be a director and go and sit in the directors meetings )

          Read everything. The lease. Articles of Association, and the important one, MEMORANDUM OF ASSOCIATION.
          If unfortunately, if your documentation states they must be a director, then I suggest that they are informed of this but with the stipulation that the must go on a training course first, instigated by you or others, to show them their obligations to defend the lease covenants, and enforce the lease covenants.

          Also to "keep the place well maintained and in good order" ( most leases will have this in ) and is not dependent on the leaseholders being unable to afford the maintenance, because as Directors, they MUST keep the place well maintained and in good order.

          Either way, sitting down all current directors to show them what their obligations are.
          The lease is a legal document and is enforceable through the courts should any one not observe the covenants.
          The freeholder too, can be taken to court for breach of his obligations under the lease, and if so; ALL directors are guilty.

          Have fun.


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