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Please, help me with the following question. I doubt the correct answer is the one given in the Kit.
A,B and C formed Private limited company, each took 100 shares and each became a director.The articles of association stated also that C was to act as a company solicitor.
Later A and B found out that C had been working with a rival company and passed secret info.For one of the questions for the case above there was an answer that C cannot rely on the articles of association for her to remain as the company solicitor. I want to know what is the rationale for such answer. I was thinking that if Articles bind the company to members ONLY in their capacity as members, then C can rely.
OR, should we take into account the following: “The articles of association stated also that C was to act as a company solicitor” , as it was mentioned in the case and answer that she can not rely?“I want to know what is the rationale for such answer. I was thinking that if Articles bind the company to members ONLY in their capacity as members, then C can rely.” – you’ve said it yourself! She’s trying to rely on the articles to create a contract between the company and herself as a solicitor, not as a member
But, I have got the questions as: if C wants to continue as a solicitor, despite of that A and B remove him (as a director) from the company, he still can rely on Articles because the Articles bind him and the company in his capacity of director, not solicitor…Did I misunderstand the question?
“if C wants to continue as a solicitor, despite of that A and B remove him (as a director) from the company, he still can rely on Articles because the Articles bind him and the company in his capacity of director, not solicitor” – the exact same point applies! The articles bind the company to the members IN THEIR CAPACITY AS MEMBERS AND NOT IN ANY OTHER CAPACITY!
So not in the capacity as a solicitor, NOR IN THE CAPACITY AS A DIRECTOR! Only in the capacity as a member
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