Azlin, Beng, Charlie and Don are the directors of AK Bhd (the company). They were appointed as directors two years ago. Charlie is the managing director of the company. Two weeks ago, Charlie, who is now 71 years old, entered into a contract on behalf of the company to purchase office stationery from the company supplier, Omos Sdn Bhd, at a price of RM100,000. Last week, following an argument among the directors at a board meeting, Beng, Charlie and Don decided to remove Azlin as a director. A notice signed by Beng, Charlie and Don was sent to Azlin stating that Azlin had been removed as a director with immediate effect. Advise Charlie and Azlin, who wishes to know the following:

(a) Based on the Companies Act 2016, the circumstances when a person shall not hold office as a director of a company.

(b) Whether the contract for the purchase of office stationery can be invalidated on the claim that Charlie was “disqualified to act as a director” of the company.

(c) Whether the removal of Azlin as a director is valid.

Answer rating: 100% (QA)

Solution a The persons who disqualified from being a director are based on the decision of the boar... View the full answer