Company Law Forum - Explaining Companies Act 2006

Split Boardroom

Written by Anthony Toller

Monday, 08 September 2008

Our company has four directors and we are split 50/50 on appointing a fifth. The two of us in favour hold 70% of the shares. Can we carry the motion?

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Comments (2)

1. Written by Merlin, on 22-09-2008 10:40
Answer is the same in both cases - requisition a meeting of the members (or circulate a written resolution).

The appointment of the additional director is an Ordinary Resolution and requires a simple majority.

The winding up of the company if it is by appointment of a liquidator is a slightly different problem in that it requires a Special Resolution with a 75% majority.

Depending on what else need to be done you may condsider using the 65% majority to remove the disagreeing directors. In doing so there may be other impacts such as an action for compensation for loss of office. Reducing the directors to two could also allow a striking off under the provisions of s652a Companies Act 1985 as this is an application by the directors and requires a simpple majority of those serving as such to sign.

A meeting to remove the diorectors would be required and Special Notice must be given.

Merlin

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2. Written by lpatrick, on 11-09-2008 04:56
I have a similar question: We are a company with 4 directors and combined, own 100% of the shares. The split works out to be 65% : 35%. We're in the process of winding up the company but are at stark odds on many important decisions. What is the easiest and quickest way for us to exert our majority shareholding at the board to force decisions and policy?

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