How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask Alex J. Your Own Question

Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3557
Experience:  Solicitors 2 years plus PQE
13113900
Type Your Law Question Here...
Alex J. is online now

Recently myself and two others set up a new limited

Resolved Question:

Hello,
Recently myself and two others set up a new limited company registered in scotland, I was added to the company as a director and shareholder about 2 months after they registered the company.
The company then took out a £24,000 loan from the bank to get started, all three of us were guarantors for the loan although the loan is repaid by the actual company.
Now, due to not being able to afford financial input in to the company and personal circumstances the other two Directors removed me as a Director and shareholder - I found this out from a third party several days after the event - is that allowed without a board meeting?
Since they have removed me I have received quite rude and insulting emails from them demanding that I give them £8000 as repayment of the loan, of course the loan money has been spent on company assets that the remaining two directors own 50% of each as I no longer have a share of the company since they removed me.
I spoke with business relations at the Royal Bank of Scotland who informed me that as the other two Directors removed me as a Director and shareholder I no longer have any liability towards the loan and all liability now lies with the remaining two Directors.
I have also spoken with a top flight accountant who has said the same as the bank, I just now need to hear a legal opinion on this.
Between the three Directors when the company started, no contract or legal agreement has ever been signed as there is not one, no lease on rented premises has been signed either as the landlord has never produced a lease, no other legal documentation has ever been signed between the three (now two) Directors.
At the bank on signing the guarantor bit for the loan it turned out the one I signed was in the name of one of the other Directors - I never signed another after that so they have incorrect guarantor paper work from me.
I look forward to hearing a legal opinion.
Submitted: 1 year ago.
Category: Law
Expert:  Alex J. replied 1 year ago.
Hi,
Thank you for your question and welcome.
My name is ***** ***** I will assist you.
The first point I would note is based on what you have described the advice you have been given is correct. You cannot be liable for another persons debts (in this case a company is a legal person) without accepting liability in writing. The instrument used for this (the guarantee) has not been executed in your name. The bank therefore cannot call on you under the guarantee - it is flawed. As the bank clearly hold a similar opinion - for piece of mind I would ask the bank to confirm in writing that you have never signed an effective guarantee for the company debts to RBS.
In relation to the shares - did you sign a stock transfer form?
Kind regards
AJ
Customer: replied 1 year ago.
Hi Alex,I have never signed a stock transfer form - what is it exactly?RegardsJon
Expert:  Alex J. replied 1 year ago.
Hi,
Thank you.
They cannot take your shares off you without your consent unless you gave them a contractual right to do so in a shareholders agreement for example?
In order to transfer your shares to another party you have to consent to it - you would have signed a stock transfer form CON40G - I think you would know if you signed one.
Did you ever have any share certificates?
Kind regards
AJ
Customer: replied 1 year ago.
Hi Alex,I never received any share certificates and nor did I sign anything in relation to shares although apparently I had 1 equal share.
After looking at their company returns there are only two share holders.Was it legal for them to remove me as a Director in the way they did?In fact have they broken any laws in the way they have done this?RegardsJon
Expert:  Alex J. replied 1 year ago.
Hi,
Thank you.
Unfortunately it sounds like they never actually gave you a shareholding.
Legally they could have removed you as a director by voting 2-1 against you for your removal or passing a shareholder resolution - which would only require a 51% majority.
If you had an employment contract or had were paid a salary, you may have grounds to make an employment claim.
Kind regards
AJ
Customer: replied 1 year ago.
Hi Alex,Thanks for your reply, I think this concludes our discussion.Kind RegardsJon
Expert:  Alex J. replied 1 year ago.
Hi,
No problem.
If I can assist any further please do not hesitate to contact me.
Any feedback is gratefully received.
Kind regards
AJ
Alex J., Solicitor
Category: Law
Satisfied Customers: 3557
Experience: Solicitors 2 years plus PQE
Alex J. and other Law Specialists are ready to help you

What Customers are Saying:

 
 
 
  • Thank you so much for your help. Your answers were really useful and came back so quickly. Great! Maggie
< Previous | Next >
  • Thank you so much for your help. Your answers were really useful and came back so quickly. Great! Maggie
  • A quick response, a succinct and helpful answer in simple English. I believe I can now confront the counter party with confidence -- worth the 30 bucks! Rick
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP
  • I couldn't be more satisfied! This is the site I will always come to when I need a second opinion. Justin
  • Just let me say that this encounter has been entirely professional and most helpful. I liked that I could ask additional questions and get answered in a very short turn around. Esther
 
 
 

Meet The Experts:

 
 
 
  • Jo C.

    Jo C.

    Barrister

    Satisfied Customers:

    30316
    Over 5 years in practice
< Previous | Next >
  • http://ww2.justanswer.com/uploads/EM/emus/2015-7-7_192327_bigstockportraitofconfidentfemale.64x64.jpg Jo C.'s Avatar

    Jo C.

    Barrister

    Satisfied Customers:

    30316
    Over 5 years in practice
  • http://ww2.justanswer.com/uploads/BE/benjones/2015-12-1_0437_ennew.64x64.jpg Ben Jones's Avatar

    Ben Jones

    UK Lawyer

    Satisfied Customers:

    11553
    Qualified Solicitor - Please start your question with 'For Ben Jones'
  • http://ww2.justanswer.com/uploads/BU/Buachaill/2012-5-25_211156_barrister5.64x64.jpg Buachaill's Avatar

    Buachaill

    Barrister

    Satisfied Customers:

    1754
    Barrister 17 years experience
  • http://ww2.justanswer.com/uploads/JO/jojobi/2013-3-19_0265_maxlowryphoto.64x64.jpg Max Lowry's Avatar

    Max Lowry

    Advocate

    Satisfied Customers:

    894
    LLB, 10 years post qualification experience
  • http://ww2.justanswer.com/uploads/UK/UKLawyer/2012-4-12_9849_F2.64x64.jpg UK_Lawyer's Avatar

    UK_Lawyer

    Solicitor

    Satisfied Customers:

    750
    I am a qualified solicitor and an expert in UK law.
  • http://ww2.justanswer.com/uploads/KA/Kasare/kasare.64x64.jpg Kasare's Avatar

    Kasare

    Solicitor

    Satisfied Customers:

    402
    Solicitor, 10 yrs plus experience in civil litigation, employment and family law
  • http://ww2.justanswer.com/uploads/OS/osh/2015-7-7_19268_gettyimagesb.64x64.jpg Joshua's Avatar

    Joshua

    Lawyer

    Satisfied Customers:

    8199
    LL.B (Hons), Higher Prof. Dip. Law & Practice
 
 
 

Related Law Questions