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  • FIRST POST
    • Sunshinemonkeys
    • By Sunshinemonkeys 5th Aug 18, 10:31 PM
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    Sunshinemonkeys
    Directors of company confusion
    • #1
    • 5th Aug 18, 10:31 PM
    Directors of company confusion 5th Aug 18 at 10:31 PM
    Hi,
    I hope I have posted this in the correct forum! It!!!8217;s a bit of a long story but any advice would be greatly received.

    My grandad passed away in July 2018, he owed a private limited company and my father is a director of this company. My grandad had a difficult relationship with his children (and pretty much everyone at times!) and in his latter years had not spoken to either of his two daughters for a period of time (one for 15 years, the other for a year). Now he kept saying to me that there would be difficulties when he died between the two sisters due to money. My grandfather owned his own home but also owed 2 other houses (in the company name). The 2 daughters he had no contact with spent the last week he was alive with him 24/7. Both interested in his money and have since disclosed they found his will prior to his death. Neither were directors of the company until I looked at Companies House and found that one of my aunts had registered as a director in April (when my grandfather had nothing to do with her) but was not registered until 2 days prior to his death. The other aunt was put as a director 4 days prior to his death (registered 2 days prior to his death). One of the aunts was already company secutary so (with my limited knowledge) I understand she could have signed the form to approve the other as a director. My father was never informed of this and more importantly, my grandad would not have been in a position to sign for anything.
    My concern is they have managed to put themselves as directors on a company for financial gain (having admitted they saw the will before he died, where I must add, they are both named but are recieving substantially less than they thought) and what are the legalities of this?
    1) for Aunt 1 (secutary) to sign her sister up as a director
    2) for Aunt 2 then to sign for Aunt 1 to become a director as well as secutary
    3) should my father have been informed of these changes as he was already a director?
    4) could they have done this without my grandfather (who is the majority shareholder and would have lacked the capacity to make this decision) knowing?
    5) why would it have taken 3 months to register a director as Aunt 1 (I believe) has back dated her registration for position of a director to April but states !!!8216;received for electronic filing on 13/07/2918!!!8217;, the same date as Aunt 2)

    I must also add Aunt 1 and Aunt 2 have not spoken for 25 years but are now appearing to have buried the hatchet and are focused on the end result. Aunt 2 also took £30,000 from her mother so I am aware that her primary focus is financial gain. There is one other sibling who they have not added as director. He would be very likely to make similar decisions as my father and I am worried they did not put him as a director as if the two aunts side together, they get the majority vote.

    I hope this makes sense, any information would be really appreciated. Thank you.
    Last edited by Sunshinemonkeys; 05-08-2018 at 10:45 PM.
Page 1
    • Kate/Bob
    • By Kate/Bob 5th Aug 18, 10:50 PM
    • 1,637 Posts
    • 5,337 Thanks
    Kate/Bob
    • #2
    • 5th Aug 18, 10:50 PM
    • #2
    • 5th Aug 18, 10:50 PM
    Are they also shareholders of the company?
    This is an important distinction, as directors they can control the running of the company but don't receive any income from it (apart from a salary). The shareholders are the owners of the company and receive any dividend (share of the profit)from the company.

    The shareholders should also have control of appointing/firing any company directors (depending on voting rights of the shares)

    Since you stated your grandfather owned the company, I assume he was the sole or majority shareholder and you'll need to know who inherits the shares because they now have control. This will be complicated as until ownership is sorted out per the will the directors will have control over the company, but must act in the shareholders best interests.
    Kate short for Bob.

    Alphabet thread High Priestess of all things unsavoury

    Tesla was a genius.
    • Sunshinemonkeys
    • By Sunshinemonkeys 5th Aug 18, 10:59 PM
    • 4 Posts
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    Sunshinemonkeys
    • #3
    • 5th Aug 18, 10:59 PM
    • #3
    • 5th Aug 18, 10:59 PM
    The two aunts and other sibling are shareholders. My father is not as he gave them back to his father approx 10 years ago. We are not sure who he has left his shares to yet (will be established this week) but I do know that my grandfather was the majority shareholder.

    Will it make any difference with the two aunts being directors as well as shareholders?

    Thanks for your reply!
    • Dox
    • By Dox 5th Aug 18, 11:09 PM
    • 856 Posts
    • 633 Thanks
    Dox
    • #4
    • 5th Aug 18, 11:09 PM
    • #4
    • 5th Aug 18, 11:09 PM
    You need to have a look at the Articles of Association (download free from Companies House website unless the company was registered a long time ago, in which case ring them to see if they can help - or ask the aunt who is company secretary) and check what the provisions are for appointing directors. Often new directors can be appointed by a simple resolution of a quorate meeting of the existing directors. Ask them for a copy of the minutes of any such meeting.

    Having said that, this is a right mess and putting it in the hands of a solicitor sooner rather than later looks like the only sensible course of action.
    • Yorkshireman99
    • By Yorkshireman99 5th Aug 18, 11:09 PM
    • 4,398 Posts
    • 3,626 Thanks
    Yorkshireman99
    • #5
    • 5th Aug 18, 11:09 PM
    • #5
    • 5th Aug 18, 11:09 PM
    The two aunts and other sibling are shareholders. My father is not as he gave them back to his father approx 10 years ago. We are not sure who he has left his shares to yet (will be established this week) but I do know that my grandfather was the majority shareholder.

    Will it make any difference with the two aunts being directors as well as shareholders?

    Thanks for your reply!
    Originally posted by Sunshinemonkeys
    Ownership of the shares and director ships are two separate issues. You need to get the facts on both before proceeding. Likewise the companies articles my limit who can hold shares. The directors need urgent professional advice on how to proceed. Are you a shareholder or director?
    Last edited by Yorkshireman99; 06-08-2018 at 4:12 AM.
    • Sunshinemonkeys
    • By Sunshinemonkeys 5th Aug 18, 11:32 PM
    • 4 Posts
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    Sunshinemonkeys
    • #6
    • 5th Aug 18, 11:32 PM
    • #6
    • 5th Aug 18, 11:32 PM
    Dox - the company was incorporated in 1974. Iím not sure if thatís too old for the Articles of Association but I will have a look. Thank you. We are trying to avoid discussing with the aunt who is also the secretary as we are concerned that she is trying to fiddle things without my father knowing. My father was only the director (a long with my grandfather) and I know for sure that there was no meeting held in regards to either aunts becoming directors.

    Yorkshireman99 - prior to my grandad becoming terminally ill my father was the only director (with my grandfather) but was not a share holder due to giving them back to my grandfather approx 10 years a go. The two aunts are shareholders and always have been but have now appeared as directors too. I am neither a shareholder or director, my father is but they both believe my father is too laid back to realise however, I am not. And my father does not know how to proceed - heís written to the accountant regarding the approval of the two aunts becoming directors in his last days prior to his death. He is planning on asking the executor of the will for a copy of the will tomorrow as well to establish who has inherited my grandfathers shared.

    Thanks for the replies.
    • Yorkshireman99
    • By Yorkshireman99 6th Aug 18, 4:17 AM
    • 4,398 Posts
    • 3,626 Thanks
    Yorkshireman99
    • #7
    • 6th Aug 18, 4:17 AM
    • #7
    • 6th Aug 18, 4:17 AM
    Dox - the company was incorporated in 1974. Iím not sure if thatís too old for the Articles of Association but I will have a look. Thank you. We are trying to avoid discussing with the aunt who is also the secretary as we are concerned that she is trying to fiddle things without my father knowing. My father was only the director (a long with my grandfather) and I know for sure that there was no meeting held in regards to either aunts becoming directors.

    Yorkshireman99 - prior to my grandad becoming terminally ill my father was the only director (with my grandfather) but was not a share holder due to giving them back to my grandfather approx 10 years a go. The two aunts are shareholders and always have been but have now appeared as directors too. I am neither a shareholder or director, my father is but they both believe my father is too laid back to realise however, I am not. And my father does not know how to proceed - heís written to the accountant regarding the approval of the two aunts becoming directors in his last days prior to his death. He is planning on asking the executor of the will for a copy of the will tomorrow as well to establish who has inherited my grandfathers shared.

    Thanks for the replies.
    Originally posted by Sunshinemonkeys
    Noted. Same advice when you have the detail. Most of the information is already available on line at the companies house website. Share register is open to anyon to view on demand from the company. Get details from cH most is free if you ask CH not the parasites pretending to be CH who charge.
    • SeniorSam
    • By SeniorSam 6th Aug 18, 8:45 AM
    • 1,152 Posts
    • 582 Thanks
    SeniorSam
    • #8
    • 6th Aug 18, 8:45 AM
    • #8
    • 6th Aug 18, 8:45 AM
    It seems that the Directors are not relevant here. If the Grandfather held all the shares of the company, then his Will would show who inherited them. Aunts or Uncles as Directors do not own anything, only the shareholders, as mentioned. Do you know who your grandfather left his estate to?
    Sam
    I'm a retired IFA who specialised for many years in Inheritance Tax, Wills and Trusts. I cannot offer advice now, so my comments are just meant to be helpful.
    • Sunshinemonkeys
    • By Sunshinemonkeys 6th Aug 18, 7:25 PM
    • 4 Posts
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    Sunshinemonkeys
    • #9
    • 6th Aug 18, 7:25 PM
    • #9
    • 6th Aug 18, 7:25 PM
    SeniorSam -

    Thanks for your reply. My grandfather didnít have all the shares. He had the majority. I have not established who he has left those to as of yet (should be this week that I am made aware).
    If directors are not relevant why would both aunts sign themselves as directors 2 days prior to his death when both are shareholders too? They are both savvy with money and my concern is that they did this when my grandfather lacked the capacity to make that decision (although difficult to prove, he was on morphine) but if there is no gain, what incentive would they have had to go it?

    His estate was due to be left solely to his 4 children however, following family disputes, he left his own property to us (the grandchildren) and his company to his children. The company has 2 properties that are rented out.
    • Dox
    • By Dox 7th Aug 18, 12:29 PM
    • 856 Posts
    • 633 Thanks
    Dox
    SeniorSam -

    Thanks for your reply. My grandfather didnít have all the shares. He had the majority. I have not established who he has left those to as of yet (should be this week that I am made aware).
    If directors are not relevant why would both aunts sign themselves as directors 2 days prior to his death when both are shareholders too? They are both savvy with money and my concern is that they did this when my grandfather lacked the capacity to make that decision (although difficult to prove, he was on morphine) but if there is no gain, what incentive would they have had to go it?

    His estate was due to be left solely to his 4 children however, following family disputes, he left his own property to us (the grandchildren) and his company to his children. The company has 2 properties that are rented out.
    Originally posted by Sunshinemonkeys
    Because the directors run the company on a day to day basis and take the vast majority of decisions without the need to get shareholder approval. Being directors would give your aunts a lot of power, not least in terms of what happens to the properties owned by the company.
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