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- June 28, 2018 at 12:32 pm #460446
Hello Tutor,I would like to ask for your help with the explanation of some sentence extract from the study text which I can’t really understand the meaning of it, I’ll much appreciate for your assistance?Thank you in advance 🙂
1.A person who is given the title of director,such as ‘sales director’ ,to give them status in the company structure is not a director in company law.This is unless by virtue of their appointment they are member of the board of directors.
-How about the sales director is also a member of the board of director?
-Is it mean the “director” title didn’t constitute a person is a director in a simpler word?2.When the appointment of director is proposed at a general meeting of a public company,a separate resolution should be proposed for the election of each director.”However the rule may be waived if a resolution to the effect is first carried without any vote being against it.”
3. such contract(contract of employment) cover all service that a director may provide ,including services outside the role of director,and those made by a third party in respect of services that a director is contracted to perform.
-I don’t understand the meaning of the last sentence regard to the third party.4.Under the Act no resolution may deprive a removed director of any compensation or damages related to their termination to which they are entitled to.
5.Unlike s175,an act which would potentially be in breach of this duty (duty not to accept benefits from third parties)cannot be authorized by the director,but the member do have the right to authorize it.
-Is mean the member can approve an act even though there will be breach of that duty ,but not director?6.A director can be held personally liable for negligent advice given by their company only when they assume responsibility in a personal capacity for advice given rather than simply giving advice in their capacity as a director.
-2,4,6 totally do not understand the meaning
June 28, 2018 at 12:57 pm #460450“-Is it mean the “director” title didn’t constitute a person is a director in a simpler word?”
Correct – you could give them the title of vice-president but unless they are properly appointed to the board of directors, they are simply an employee with a fancy job title
When more than one director is being proposed for election – say there are 4 – then each one shall be appointed by an individual vote. But if the meeting so resolves by special resolution to pass a composite resolution, then all 4 may be appointed by a single resolution
It would be preferable if I had the full context of the sentence to which you refer in your third question but my initial reaction is that a contract of employment covers ALL matters that the director may be expected to perform including those duties owed as a result of a third party contracting with the company to use that director’s services
I can see nothing in your fourth point that is capable of being misunderstood! A company cannot pass a resolution to deprive a director of their entitlement to compensation
5 – correct
Advice given by a director in the name of the company is not potentially personally liable. But if that director accepts personal responsibility for that advice then that director is liable
OK?
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