Some considerations regarding the revocation of the company director

• Author: Cristina Cojocaru
• Position: Law Department, Bucharest University of Economic Studies, Romania
• Pages: 66-69

SOME CONSIDERATIONS REGARDING THE REVOCATION OF THE

COMPANY DIRECTOR

Assistant professor Cristina COJOCARU

1, PhD.

Abstract

In principle, in Romania, according to cur rent r egulations, the director of a company can not addr ess the

court again st the decision of the genera l meeting of sha reholders through which he/she was revoked from his/her

position, rega rdless of the rea sons for the revocation. However, if the director is also the sha reholder of that compan y,

he/she may appeal the dec ision of the genera l meeting of shar eholders, for other rea sons than the revocation itself. This

is the case even if, by that decision of the genera l meeting of shareh olders it has been decided, inter alia, the revocation

of the director . Also, the la ws of Romania stipulate that the revoked director has the possibility to claim in cour t

damages if he/she fulfilled cor rectly the duties as director of the company. At the same time, the article looks at the

concept of director, his/her relations with the company and the revocation of the directo r as general conce pt.

Keywords: company, revocation, directo r, general meeting of shareholder s

JEL Classification: K22

I. Introduction

The idea behind this article started from a relatively recent decision of the High Court of

Cassation and Justice2, essentially ruling that the right of a shareholder that was revoked from

his/her capacity as director to challenge the relevant resolution of the general meeting of the

shareholders cannot be restrained for other reasons than those referring to the very revocation.

In our case, the general meeting of the shareholders of the company in question approved,

during the same session and under the same resolution, an increase of the share capital and the

revocation of the director. The revoked director challenged the relevant resolution, however not

with respect to his being revoked from his capacity as director, but claimed the absolute nullity of

the resolution for breach of the legal provisions related to the convening.

The arguments brought on the merits against the action filed by the revoked director referred

to the court ignoring that, by the challenged decision, the general meeting of the shareholders

decided not only to increase the share capital of the company but also to revoke the defendant from

his capacity as director, therefore, once the resolution is challenged in connection with one aspect, it

is challenged in terms of all aspects.

Moreover, it was argued that the plaintiff, in order to be able to challenge the resolution

regarding his revocation, should have voted against it in the general meeting and such vote should

have been mentioned accordingly in the meeting minutes, which did not happen.

In order to analyze this situation, it is first required to carry out an analysis of the conditions

under which the director mandate terminates and particularly of the cases when revocation takes

place.

II. The notion of “director”

Any legal person operates based on the decisions of its management and administration

bodies, under the operation of the law3.

The director position is regulated by Companies Law no. 31/19904 (hereinafter referred to as

the “Law”). Any company is administrated by one or several directors.

1 Cristina Cojocaru - Law Department, Bucharest University of Economic Studies, Romania, cristinacojocaru5@gmail.com

2 High Court of Justice and Cassation, IInd Civil Section, Decision no. 713 of 15 February 2012

3 Ioana Nely Militaru, „Dreptul afacerilor. Intr oducere în dreptul afacerilor. Raportul juridic de afaceri. Contractul.”, Universul

Juridic Publishing House, Bucharest, 2013, p74

4 Published in Official Gazette, Part I, no. 126 of 17.11.1990, with the last amendment by Government Emergency Ordin ance no.

2/2012 published in official Gazette, Part I, no. 143 of 02.03.2012.