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Re:closing a limited company down (1 viewing) (1) Guests
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TOPIC: Re:closing a limited company down
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closing a limited company down 3 Years, 11 Months ago
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Can a company director close a company down without the agreement of the other director,i.e. in this case a public house, where one director sacked all the staff and closed the doors, without the agreement of the other director
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Re:closing a limited company down 3 Years, 11 Months ago
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In company law, directors are responsible for the day to day management of the company. This includes pursuing the company's _object_ives and considering the best interests of the company. The answer to your question very much depends on the company's articles of association and the authority vested in the directors including the convening of board meetings and quorum required to ensure a meeting is valid. Look at the articles to see what authority is vested in directors? Do directors have service contracts? If so, what authority is provided in these service contracts? I suspect that if there are only two directors, the articles provided a "deadlock" situation. If this is the case, it would not be appropriate for one director to close down the company unilaterally. However, you do not state why the company has "closed down". Are you suggesting that the company is unable to pay its debts? Note that directors do have a duty towards creditors and cannot engage in wrongful trading. The company's liquidator can bring proceedings against directors for wrongful trading. You need to look at the reasons for closure. Although the premises may have closed down, the company presumably is operating? If the company is trading at a loss, you need to address this aspect immediately. Consider an action plan with your other director and bear in mind your duty towards the creditors (if any) and the company. It may be that ultimately the company is involved in a winding up or you may decide to buy out your other partner. There are options available.
Hope this helps! S
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