Appeal Court Upholds Eight-Year Ban on Director

A case concerning a company director who was disqualified from acting as a director serves as a reminder of the circumstances in which the court will reverse such a decision.

It involved a man whose conduct was judged to have fallen below the standards of probity and competence appropriate for a person acting as a director of a company, after taking into account all the extenuating circumstances.

The director involved had an IT company which became insolvent, owing £1.7 million. He allowed the company to continue to trade when insolvent, drawing more than £160,000 in remuneration in its final months. He had authorised expenditure when there was little realistic chance it could be met and so on. The company had also failed to meet its legal administrative requirements.

The director was disqualified for eight years.

He appealed against the decision to ban him. In considering whether leave to appeal should be granted, the judge was not allowed to alter the original decision unless there was an error of law, such as failing to take into account a relevant matter, failing to exclude an irrelevant matter or reaching a conclusion that was so extreme given the facts that it must embody an error of legal reasoning.

On the basis that material facts had not been incorrectly dealt with by the lower court, no appeal could be allowed.