Consent in advance and Ratification 0.0 / 5 ? LawBusiness EntitiesUniversityOther Created by: mellonCreated on: 28-04-14 19:16 What do shareholders need to give consent for? Conflicts of interest or secret profits 1 of 15 What happens if the shareholders approve? The act will not be set aside s180 2 of 15 Can directors authorise a conflicts of interest disclosure? Yes, if allowed to do so by articles of association, but director with conflict cannot vote 3 of 15 What happens if the director fails to disclose under s177? s178 civil remedies. Then can disclose after act s182. If director fails again, criminal liability 4 of 15 How can acts be ratified after the act? By shareholder resolution. Director and connected shareholders can't vote s239 5 of 15 What can be ratified? Directors negligence, breach of duty or trust 6 of 15 In what period does ratification need to happen? s190 within a reasonable period 7 of 15 How else can a directors act be ratified? By the court s1157 8 of 15 When will the court ratify or excuse an act? When the director is honest and reasonable and the court ought to do so. eg in D'jan director was partially excused. 9 of 15 Can the articles excuse a director's act? Nooooooo 10 of 15 What is the general rule about loans between the company and directors? There is a general prohibition except where there is shareholder approval 11 of 15 Can loans be ratified? Yes, so s214 12 of 15 Are there exceptions? Yes under s204-209. If the loan is spent on the company's business, minor or business transactions or defending legal proceedings 13 of 15 What is the remedy for an unapproved loan? Avoidance, unless restitutio, 3rd party rights would be harmed or company is indemnifed 14 of 15 What happens if the approval is not minuted? Royal Hastings says then the director is still liable 15 of 15
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