If you are a “director” of a company, you have a certain status within your organisation. At Malcolm C Foy & Co, we understand that with the status come some legal responsibilities. There are many ways in which a director can be personally liable for what he, or those for whom he is responsible.
In addition, a director owes a number of duties to the shareholders. If you fail to follow them, you might be held to account by the shareholders.
As a director of a limited company, the law says you must, for example:
- try to make the company a success, using your skills, experience and judgment
- follow the company’s rules, shown in its Articles of Association
- make decisions for the benefit of the company, not yourself
- tell other shareholders if you might personally benefit from a transaction the company makes
- keep company records and report changes to Companies House and HM Revenue & Customs
- make sure the company’s accounts are a ‘true and fair view’ of the business’ finances
If the company is in financial difficulty, directors should take particular care to monitor its financial position and not allow it to continue to trade after the point in which an insolvent liquidation cannot be avoided.
At Malcolm C Foy & Co we advise directors on these issues and shareholders on action that may be taken against directors for failing to act in accordance with their duties.
If you would like to discuss a potential matter or would like any further information then please contact one of our team using the details shown on this page.