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ACCA Applied Skills · Corporate and Business Law (Global) · Company meetings and resolutions

Zeta Ltd's members want to remove a director, Mr Okoro, before his term ends. Under the general company law rules applied in the LW Global syllabus, which resolution is normally needed to remove him?

A director can be removed by the members through an ordinary resolution, meaning a simple majority of votes cast. The law does not require a special resolution or unanimity, and the other directors cannot do it on their own, because the power belongs to the members.

  1. AA special resolution passed by at least 75% of votes cast
  2. BAn ordinary resolution passed by a simple majority of votes castCorrect
  3. CA unanimous written resolution of all members
  4. DA resolution of the board of directors excluding Mr Okoro

Explanation

Removal of a director by the members needs only an ordinary resolution, which is a simple majority of votes cast, even if the director has a service contract or the articles say otherwise. A special resolution is a higher threshold than the law requires, so it is wrong. The board has no power to remove a fellow director under the statutory rule.

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