Need any help? Contact us:
Appoint or Remove Directors FAQ
A Directors’ Resolution to Appoint or Remove Directors is a resolution passed by the directors of a company to appoint a new director, typically to fill a casual vacancy on the board.
Generally, a new director must be appointed by the shareholders of a company. However, a new director may also be appointed by the board of directors using a Directors’ Resolution to Appoint Director(s) and/or acknowledge the Resignation of Director(s), subject to re-appointment by shareholders at the next general meeting.
Who can be a company director?
Almost anyone can be a director. The appointment has a few limitations, making company formation an available option for many people. An individual can be appointed if they are:
- At least 16 years old
- Not disqualified to be a director
- Not subject to an undischarged bankruptcy
Who cannot be a company director?
A person with an undischarged bankruptcy cannot be a company director unless allowed by the court until a court discharges the person from bankruptcy.
Who appoints directors?
Generally, the directors are appointed by the shareholders of a company at the Annual General Meeting (AGM) or rarely at an Extraordinary General Meeting (EGM).
The decision for the appointment is made through a vote and passed if a majority of shareholders vote in favour.
According to the articles of association, the number of directors may be limited. If so a new director may be appointed only if a vacancy arises. Once a new director is appointed, the company must announce it to the Companies House within 14 days.
Who can remove directors?
As the shareholders have the authority to appoint a director, they can remove one.
A director can be removed by 50% at a meeting of the shareholders for any reason. This right cannot be taken from them by anything in the director’s service contract or the Articles of Association.
However, if a removal violates the director’s service contract or the terms of a shareholder’s agreement, the director will have the right to fight for it if he chooses to go to court.
Common reasons for the removal of a director are:
- Mental disorder under the Mental Health Act 1983
- Bankruptcy
- Elimination under the law
- Violation of his service contract
- Self-resignation from office
- Absence from a board meeting for six months in a row
Conclusion
The company directors may pass a Directors’ Resolution to Appoint or Remove Directors to appoint a new director.
While appointing and removing directors from a company, procedures must be followed to ensure the appointment or removal is legal.
Related legal templates
About Author
Stay compliant with the Zegal template library
Zegal legal template are meticulously crafted with the precision of AI and the expertise of seasoned human lawyers, providing a unique blend of speed and reliability.
You can trust that Zegal agreements are legally sound and fully compliant with current regulations.
Whether you're a startup, SME, or a larger enterprise, Zegal contract management will automate and speed up your legal processes.
Using Zegal will reduce risk, save money, and improve efficiency. Let us take care of the paperwork so you can focus on running your business.
Don’t compromise on speed or compliance. Stay secure, compliant, and efficient with Zegal.
