Directors dereliction of duties

[animal44]

Not strictly business, but is company related.

Company sole purpose is to own freehold of a residential property (flats) and lessees are shareholders. Directors are also lessees. Directors refuse to consult under s20 of L&T act 1985 and refuse to give information to lessees. Not all requested information is covered by L&T act, e.g. board minutes. In short the directors are ignoring a statutory requirement.

Question is could an injunction and damages be bought against Directors for dereliction of duties? Would the corporate veil be relevant in this circumstance?

[Eric Mc]

Has the company or its shareholders suffered financial loss as a result?

Would it be easier just to vote the director off the board? After all, it's the shareholders who have the power to appoint and dismiss directors.

[animal44]

It is difficult to get majority support. Many are elderley and don't want any trouble so they take the easy option. Even if we did, nobody else wants to do it. I have been looking at alternatives, basically sidelining the directors, and if we could get the information we want we may be able to succeed in this.

As for losses, as lessees we are limited in liability to 250 for major work and 100 for long term contracts. This leaves a loss to the company which either means the company is insolvent or the loss is made up by the shareholders. i.e. nothing achieved. By forcing consultation we at least have a say and perhaps have evidence for wrong doing or avoid the wrong doing in the first place.