Compensation for removal - company management, Business Law and Ethics

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Compensation for Removal:

Subsection (6) provides that nothing in s.185 shall be taken as depriving a removed director of compensation or damages payable to him in respect of the termination of his appointment as director or of any appointment terminating with that as director. This provision which restates the common law rule, would enable a managing director to sue the company for damages for wrongful dismissal if the effect of his removal as director was to prematurely terminate his appointment as managing director, and was inconsistent with the contract. The director might also, if he is a member of the company, be entitled to an order for the winding up of the company by the court on the "just and equitable" ground: Ebrahimi v Westbourne Galleries Ltd.


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