Does an Ex-officio director stay a director when they no longer hold the position?

This question has been asked by Amanda in Adelaide, South Australia.

“We have a constitution for our organisation which says that a person can be appointed by the president to be the secretary. It also says in another clause the secretary is a director. In a third clause, it says that appointments made by the president can be removed by the president at any time.

My question is, if the secretary becomes a director, does he or she stay a director if the president appoints a new secretary?

We operate as a Company limited by guarantee”

This is not as complicated as it may sound. The person who is appointed secretary becomes an “ex-officio” director. That means that they are a director because they hold a particular position – in this case secretary.  If for whatever reason, (Resignation, new appointment of secretary) they cease to be secretary, then they also cease to be a director.

The confusion for some organisations that are a company limited by guarantee, is that the Australian corporations legislation states that in a public company (company limited by guarantee is a public company) directors can only be removed by the shareholders, not by the president or chairman, or the other directors.

In the case of an ex-officio director, this does not apply – the director ship is tied to a role or title – in the example in the question – the secretary role. Once the role is no longer held, neither is the directorship. Another way to look at it is that the directorship is given to the role, not to the person.

 

 

Please Note: The author accepts no responsibility for anything which occurs directly or indirectly as a result of using any of the suggestions or procedures detailed in this blog. This is not, and should be taken as legal advice. All suggestions and procedures are provided in good faith as general guidelines only and should be used in conjunction with relevant legislation, constitutions, rules, laws, by-laws, and with reasonable judgement. If you are in any doubt, seek appropriate advice.


 

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