A Director/Shareholder Has Changed the Bank Mandate Without My Agreement – What Can I Do?
A change in the company bank mandate without your agreement will be a concerning step, immediately triggering concerns on why that approach has been taken, and what else might be happening that you are/aren’t (or might not) be aware of. Any change in transparency will understandably trigger concerns that the reason for the change is to make it harder to see any wrongdoing.
If this is part of a course of conduct and pattern of other steps being taken this alone may be sufficient for you to seek legal advice. If you are a Director there may be employment law and/or statutory remedies available, especially if you are unable to perform your duties to the company as a result. As a Shareholder removal from the bank mandate may amount to a breach of the Shareholders agreement, or may cover evidence of other wrongdoing that would be actionable as an unfair prejudice petition – for example, the unlawful removal of monies might be hidden from your view or not require your authority. There may be additional factual and procedural issues and concerns that require a more urgent response, for example, how has the bank been authorised to change the mandate procedurally? Has your signature been used without your knowledge? Has someone suggested to the bank you have agreed and/or that the company has passed resolutions you are unaware of?
In terms of immediate steps, you should check the company’s articles of association – essentially the company’s constitution, and any Shareholder agreement – for specific provisions conferring or limiting the power and authority to make changes in this way. Any specific reference to the bank accounts of the company will be relevant. If there are none and this has not been agreed or referred to within any resolutions, then it may alone amount to unfair prejudice. If the change also masks the authorisation of transfers and payments that are disputed that may also amount to additional grounds of unfair prejudice in addition.