Can You Remove a Director for Breaching Their Duties?

April 14, 2026
|In COMMERCIAL AND CORPORATE
|By admin

In our previous article on acting within powers, we introduced one of the key duties owed by directors under UK law.

All company directors must comply with the duties set out in Chapter 2 of Part 10 of the Companies Act 2006.

These duties include:

  • Acting within powers
  • Promoting the success of the company
  • Exercising independent judgment
  • Exercising reasonable care, skill and diligence
  • Avoiding conflicts of interest
  • Not accepting benefits from third parties
  • Declaring any interest in a proposed transaction or arrangement

 

But what happens if a director breaches these duties?

Under English law, limited companies are generally free to determine their own internal governance. As a result, the appropriate route for removing a director will often depend on the company’s specific constitutional and contractual arrangements.

In practice, identifying the correct procedure is not always straightforward, and missteps can lead to disputes or legal challenges. Even where company documents do not provide a clear mechanism, shareholders may still rely on statutory rights under the Companies Act 2006 to remove a director.

 

Statutory Right of Removal: Procedure and Key Considerations

Under section 168 of the Companies Act 2006, a director can be removed by an ordinary resolution (more than 50% of shareholder votes).

However, strict procedural requirements must be followed including serving special notice must be given (at least 28 days before the meeting), the director must be informed of the proposed removal, has the right to make written representations and given the opportunity to speak at the meeting.

Failure to follow the correct procedure may render the removal invalid.

Breach of Duties and Shareholder Remedies

A breach of directors’ duties does not automatically result in removal, but it can give rise to legal action.

Shareholders may consider:

  • Derivative claims
    Shareholders may bring a claim on behalf of the company against a director for breach of duty, negligence, or misconduct.
  • Unfair prejudice petitions (section 994)
    Where a director’s conduct unfairly prejudices shareholders’ interests, members may apply to the court for relief.

These remedies are particularly relevant in more serious or contested disputes.

Removing a director is rarely just a procedural step and can involve wider legal and commercial issues. For example:

  • The director may also be an employee, giving rise to potential employment law risks, including claims for unfair or wrongful dismissal
  • There may be contractual implications under any service agreement or shareholder arrangements
  • Disputes can escalate quickly, particularly in closely held or family-run companies

 

Why Legal Advice Is Important
In light of these overlapping issues, taking legal advice at an early stage can be critical. It helps ensure the correct procedure is followed, manage potential risks, and reduce the likelihood of disputes or costly challenges.

Conclusion

While UK law provides a mechanism for removing a director, the appropriate approach will depend on the company’s governing documents and the specific circumstances. Starting with the company’s Articles of Association, together with taking legal advice where appropriate, can help ensure the process is carried out smoothly and in a legally compliant manner.

At Chan Neill Solicitors LLP, our Corporate and Litigation teams advise on director duties, shareholder disputes, and wider company governance matters, and are well placed to assist with issues arising from the removal of a director.