 |
What are the implications of being a director if the company folds? |
Submitted on: 8th Jul 2010 by Non-Member | Total Answers: 1
Two years ago two of us were asked to step to run the day to day business of a small limited company while the owners took a step back, The owners were directors (registered at Companies House) and they were keen that we also became registered directors as well. We have no financial holding in the company other than our salaries and we receive no shares etc. So in practice we are employees on the payroll. The company is now struggling and the owners are deciding what to do. My question is, if the company folds what is the implication for myself and my colleague. ie. financial implications and/or if we were to set up another company independently what would we need to to disclose to clients in the future?
Re: What are the implications of being a director if the ...
As you were not directors or shareholders of the business you cannot face any claims for financial losses. However, if you had as it seems unfettered control of the business the liquidator of the company could deem that you are effectively an ex-officio director. It is therefore possible that he may ask the court to place similar restrictions on you as he would on an actual director in the event of any maladministration, which could involve being disqualified from being a company director, or being involved in the management or formation of a limited company, for a set amount of time that they will determine on an individual basis.
This question has been answered by Christians Against Poverty, a leading debt charity offering hope and a solution to anyone in debt.
Post new comment