Removal of a director
These Guidance Notes provide an outline of the relevant provisions, but they are not comprehensive and should not be relied on as authoritative.
Unless there is a special provision in the company’s Articles of Association a director cannot be removed from office by the Board of Directors, and only the shareholders can remove a director. The Articles may provide a procedure for this; otherwise the statutory procedure must be used. The statutory procedure allows any director to be removed by ordinary resolution of the shareholders in general meetings (i.e., the holders of more than 50% of the voting shares must agree). This right of removal by the shareholders cannot be excluded by the Articles or by any agreement. However an executive (employed) director who is removed from office may have a claim for compensation under the law of unfair (statutory) and wrongful (contractual) dismissal, which could be substantial.
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