If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)

Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie

Hi there,
There is an issue with role permissions that is being worked on at the moment.
If you are having trouble with access or permissions on regional forums please post here to get access: https://www.boards.ie/discussion/2058365403/you-do-not-have-permission-for-that#latest

Company law question

henryd65 · 2011-09-14 13:15:26

A private company has two directors/shareholders. The directors bought an office for eur 150k a number of years ago and rent the office to the company. Office is now worth eur 100k. Can the directors sell the office to the company for eur 150k ? I don't think they can but am looking for the reason why this may not be…

14-09-2011 1:15pm

#1

henryd65

Registered Users, Registered Users 2 Posts: 107 ✭✭

Join Date: November 2006

Posts: 77

A private company has two directors/shareholders. The directors bought an office for eur 150k a number of years ago and rent the office to the company.

Office is now worth eur 100k.

Can the directors sell the office to the company for eur 150k ?

I don't think they can but am looking for the reason why this may not be allowed.

0

Comments

#2 14-09-2011 1:29pm

dermot_sheehan

Closed Accounts Posts: 2,062 ✭✭✭

Join Date: April 2004

Posts: 2023

the directors would be breaching their fiduciary duty to have the company buy property from themselves at an overvalue.

Also see PART III of the Companies Act, 1990
http://www.irishstatutebook.ie/1990/en/act/pub/0033/index.html

0
#3 19-09-2011 6:18pm

sandyhills

Registered Users, Registered Users 2 Posts: 71 ✭✭

Join Date: June 2008

Posts: 58

If a director buys or sells a non-cash asset (Eg an office) to a company and the value is over €63k or 10% of the relevant assets then you have to get shareholder approval to approve the transaction. This shouldnt be an issue for this company. Obviously you have fiduciary duties to consider.

0